Contractor requires payment for Ben Thanh-Suoi Tien construction

The contractor of the first metro line Ben Thanh-Suoi Tien has sent a request of payment for the project’s construction costs unless it will halt the project or extend progress, reported HCMC Urban Railway Management Board yesterday.

The above ground stretch of Ben Thanh-Suoi Tien metro line (Photo: SGGP)

The above ground stretch of Ben Thanh-Suoi Tien metro line (Photo: SGGP)

The board was reporting at a news conference on the progress and implementation of the city’s first metro line Ben Thanh-Suoi Tien, second route Ben Thanh-Tham Luong and fifth route Saigon Bridge-Bay Hien crossroads.
According to the board, the project will meet with a lot of difficulties because of too slow disbursement of official development fund (ODA) capital from the central budget.
Head of board Le Nguyen Minh Quang said that HCMC needs over VND5.4 trillion (US$238 million) in payment for the first metro line’s contractor this year but so far the central budget has allocated only VND2.1 trillion.
The city has proposed the Ministry of Planning and Investment to quickly disburse without response. HCMC expects to have a mechanism allocating funds in accordance with the project’s progress not in waves, Mr. Quang said.
If the Government does not arrange ODA funds for the project in a timely manner, the contractor might halt the project or extend progress. If that occurs, the board will face three threats.
Firstly, in case construction progress is extended, experts working for the project might quit as they cannot wait. Once they leave, it will be difficult to invite them back.
Secondly, the board has to pay interest for the late payment and compensate for relevant damages basing on contract terms. Thirdly, slow progress due to capital allocation will affect investors’ attraction.
Mr. Quang said that Japan International Cooperation Agency (JICA) has expressed concern about the project’s situation.
When the city talked to the agency about capital for other metro projects, the agency straightly stated their point of view that the city must make payment for contractors first.
Bid packages on schedule
HCMC needs over VND5.4 trillion (US$238 million) to pay the contractors of Ben Thanh-Suoi Tien metro line project in 2017 but so far the central budget has allocated only VND2.1 trillion.

Director of Ben Thanh-Suoi Tien metro line project Duong Huu Hoa said that bid packages have been on schedule.
Package 1a building underground stretching Ben Thanh terminal-Saigon Opera House has completed 5 percent of work volume on contracts, underground 1b section from the opera house to Ba Son station has also finished 45 percent.
The progress of the second package building 17.1 kilometers above ground stretches from Ba Son to Binh Duong province and a depot has reached 67 percent.
The third package buying locomotives, coaches and equipment, rail tracks and maintenance devices has approximated 12 percent.
The fourth package equipping information technology system for an operation and maintenance company is expected to start technical design at the end of this year.
Other metro projects under investment preparations comprise route 3a Ben Thanh-Tan Kien and no. 5 new Can Giuoc station-Bay Hien crossroads.
The Ministry of Economy, Trade and Industry of Japan has completed consultation for the first metro line extension to Binh Duong and Dong Nai provinces in February this year.
The city People’s Committee has assigned the Department of Transport to continue working on procedure to extend the route.

By HA DIU - Translated by Hai Mien

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