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Vietnam Approves Additional Funding for Saigon’s Metro Line 1, 2

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Hopefully, the increased funding can help alleviate the crises surrounding the construction of the first metro line and kick start the second line’s construction.

The government recently approved an additional VND52 trillion in total budget for Ho Chi Minh City’s first two metro lines  VnExpress reports.

Metro Line 1, which will run 20 kilometers from Ben Thanh Market in District 1 to Suoi Tien Amusement Park in District 9, was projected to cost VND17.4 trillion back in 2007. The line was expected to be finished in late 2018; however, at the time of writing, only 60% of the construction has been completed and the cost has gone up to VND47 trillion. The project was funded in part through an official development assistance (ODA) loan from the Japan International Cooperation Agency (JICA).

Since construction began in 2012, the Metro Line 1 project has run into many issues, including slow budget disbursement and a personnel crisis. Recently, Japanese Ambassador to Vietnam Umeda Kunio sent a letter to the HCMC People’s Committee warning that if the outstanding payment of US$100 million owed to Sumitomo, a major Japanese contractor, remains unpaid, it will halt construction. This problem will hopefully be resolved with the newly revised funding of VND47.3 trillion.

In December of last year, Tuoi Tre reported that 52 transport authorities related to the metro had resigned over the last 12 months, including the metro project’s chief manager and two executives on the management board, leading to more difficulties and delays. The city recently appointed Director of the Transport Department Bui Xuan Cuong to step in as the chief manager.

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Nguyen Thien Nhan, a member of the politburo, told VnExpress that “there aren’t any obstacles left for disbursing capital for the project.” He also added that the city will push for the project to be completed in 2020.

Meanwhile the cost for Metro Line 2, which will run from Ben Thanh Market to Tham Luong Bridge in Tan Phu District, has been revised from VND26.12 trillion to VND47.89 trillion. Construction was supposed to start in 2014, but work is still on hold due to site clearance complications and funding shortages.

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