Saigon’s subway, environment projects hindered by insufficient capital allocation
TUOI TRE NEWS
UPDATED : 04/27/2017 18:32 GMT + 7
The future of two costly megaprojects in Ho Chi Minh City is at risk due to insufficient capital from the state budget.
The metro line No.1, the first-ever subway system in the southern Vietnamese metropolis, and the second phase of a project to improve the city’s water environment are both partially funded by official development assistance (ODA).
ODA is considered part of the state budget, with the government in charge of disbursing the money to specific projects.
However, the government’s ODA allocations for these Ho Chi Minh City megaprojects have been lower than needed, putting their construction on the verge of cessation due to a shortage of capital.
Since the third quarter of last year, Ho Chi Minh City has been using its own budget to pay contractors in order to keep construction going, but municipal authorities say this temporary solution cannot last long.
Less than 50 percent disbursed
The metro line No.1, connecting Ben Thanh Terminal in District 1 with Suoi Tien Terminal in District 9, is expected to have VND41.8 trillion (US$1.87 billion) of its total investment covered by ODA.
Vietnam has closed three ODA agreements totaling more than VND31 trillion ($1.38 billion) in credit for the subway project.
However, as of April 2017, only 34 percent of the total ODA pledged for the project had been disbursed.
click here to continue reading
http://tuoitrenews.vn/business/40716...tal-allocation