Meanwhile, the Ministry of Transport stated that the appraisal process for these projects is slow due to inexperience and obstacles hindering capital disbursement.
Since all the projects, funded by Ho Chi Minh City (HCMC), Hanoi and the transport ministry, are classified as Group A projects or bear national importance, the relevant ministries made independent reports on their tasks for each project.
According to the transport ministry, these metro line projects are lagging behind schedule and facing cost overruns as investors are still inexperienced in the metro line model. As a result, capital revision plans made by both investors and consulting units were not feasible.
Besides this, the use of official development assistance (ODA) loans for some projects remains inadequate. ODA loans were not allocated properly, resulting in late payments for contractors and a shortage of reciprocal capital, affecting the progress of construction work.
Further, the selection of contractors faced obstacles, triggered by the complicated requirements of sponsors.
There are two projects in the capital city of Hanoi. Line No.1 (Ngoc Hoi-Yen Vien), approved by the Government, is 28.7 kilometers long and requires over VND9 trillion in investment for all three phases, according to the planning and investment ministry.
To date, the transport ministry has sought the prime minister’s approval to divide the project into two phases. Ngoc Hoi Complex and a section from Bat Giap to Gia Lam will be executed in the first phase, while the Ngoc Hoi-Bat Giap and Gia Lam-Yen Vien sections will be constructed in the second phase.
Line No.2 (Nam Thang Long-Tran Hung Dao), a Grade A project, was approved by the municipal government in November 2008, with the initial total investment exceeding VND19.5 trillion. The amount was later proposed for revision to VND51 trillion by the municipal government. The prime minister had asked the planning and investment ministry to appraise the capital revision and conduct a more appropriate feasibility study.
The three other projects are located in HCMC. Line No.1, running from Ben Thanh to Suoi Tien station, had its initial investment approved by the HCMC People’s Committee, at roughly VND17.3 trillion, which was later raised to over VND47.3 trillion.
Line No.2 connecting Ben Thanh and Tham Luong required a hike in funding from VND26 trillion to over VND47.8 trillion.
Both Lines No.1 and 2 in the southern city are Group A projects, but due to the cost revision, many issues have arisen related to the criteria for nationally important projects.
For the third line project linking Bay Hien Intersection with Saigon Bridge, the State Appraisal Council appraised it in May 2017 and asked the relevant agencies to conduct a feasibility study and consider tapping the local budget to pay the consulting fees. Preparations for the project’s construction are scheduled for completion in April next year.
