Government hastens capital injection scheme for southern metro projects

government hastens capital injection scheme for southern metro projects hinh 0
Ben Thanh – Suoi Tien metro line includes a 2.6 km long tunnel designed with three depots and a 17km above-ground section with 11 depots.

According to Vietnam Economics Times, the Ministry of Planning and Investment was asked to team up with other ministries to assist HCM City in mulling over plans to ratify capital adjustments for the two metro projects. They includes the partially completed Ben Thanh – Suoi Tien section and the upcoming Ben Thanh – Tham Luong line.

The outcomes from considering the capital injection will be reported back to the Prime Minister while good quality and further developments on the metro lines must be secured.

The Ben Thanh – Suoi Tien metro line is the first section of a mega metro project connecting HCM City with neighbouring provinces. The construction on the first metro line resumed in August 2012.

It stretches nearly 20 km in total, connecting district 1 of HCM City to Di An townlet in Binh Duong province. The work includes a 2.6 km long tunnel designed with three depots and a 17km above-ground section with 11 depots.

Last month, HCM City reportedly made rushed attempts to put the long-delayed Ben Thanh – Suoi Tien metro line into operation by 2020.

The project has suffered from chronic delays with only half of the project’s work volumes being completed, due to a lack of capital and divided opinions over the total capitalisation.

The first line, initially valued at VND17.4 trillion (US$741.5 million), was approved by HCM City in 2007. At the time, approval from the National Assembly was not needed.

However, the capital required to complete the first metro line has skyrocketed to VND47.3 trillion (US$2.01 billion) after an array of capital adjustments in 2011. This level of capital means the first metro line has been named among a list of projects which must be submitted to the National Assembly for approval.

Meanwhile, the second Ben Thanh – Tham Luong metro line was approved in 2010, with the volume of capital exceeding US$1.3 billion.

The funding includes US$540 million financed by the Asian Development Bank (ADB), US$313 million from the German Development Bank, and US$195 million from the European Investment Bank (EIB).

However, the capitalisation has been adjusted to over US$2.1 billion due to a slip in prices, financial costs, additional costs for building items that link the second metro line with metro line 3b, metro line 5, and metro line 6, in addition to expenses for extending the length of tunnel depots.

The second metro line will be 20km in length, starting near Thu Thiem ward in district 2 and ending at Tay Ninh bus station in the southeast province of Tay Ninh. Construction on the project is expected to begin in 2020 and be completed by 2024. 

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