Unable to continue mobilizing capital for the 10,000 billion flood prevention project

The biggest current difficulty of the 10,000 billion VND flood prevention project is the inability to continue mobilizing capital to complete the construction.

On the afternoon of November 7, at a press conference on the socio-economic situation of Ho Chi Minh City, Mr. Do Quang Hung, Head of the Public-Private Synthesis Department - Ho Chi Minh City Department of Planning and Investment shared information about the project to solve flooding caused by tides in Ho Chi Minh City area taking into account climate change factors - phase 1 (10,000 billion VND flood prevention project).

The 10,000 billion VND flood prevention project is 90% completed but must be shelved.

Mr. Hung said that the project is implemented under the PPP method (public-private investment). Currently, the project is facing difficulties and problems, the main reason being the continuous changes in legal regulations related to the application of the BT (build-transfer) contract mechanism.

"Up to now, although the project has been 90% completed, the Ho Chi Minh City People's Committee has not been able to pay the project investor. The reason is that the payment conditions are not met according to the provisions of the law and the provisions of the signed contract, along with the conditions for loan disbursement and refinancing for the project have also expired," Mr. Hung shared.

According to Mr. Hung, the Prime Minister has established a separate working group to direct the review and removal of difficulties and obstacles of the project.

Ho Chi Minh City has also proactively researched and proposed many solutions to the Central Government. However, there has not been any consensus yet due to legal regulations.

The project is expected to control flooding caused by high tides and respond to climate change for an area of ​​570 square kilometers, with about 6.5 million people. Photo: My Quynh

The Ho Chi Minh City People's Committee also reported to the Prime Minister on the implementation status and proposed directions to remove difficulties and obstacles for the project.

"The biggest difficulty of the project is the inability to continue mobilizing capital, estimated at 1,800 billion VND to complete the construction," Mr. Hung added.

Explaining further, Mr. Hung said that this problem arose from the fact that BIDV bank did not have enough basis to sign a credit contract with the investor to submit to the State Bank to extend the re-lending disbursement time.

In fact, the State Bank has collected debt and refinanced about 3,560 billion VND from BIDV bank.

Therefore, in case the State Bank extends the loan disbursement period for refinancing, BIDV cannot continue to disburse to investors because it does not meet the conditions for payment by the Ho Chi Minh City People's Committee.

People wade through flooded streets due to high tides in District 7, Ho Chi Minh City. Photo: My Quynh

Recently, Vice Chairman of Ho Chi Minh City People's Committee Bui Xuan Cuong held a meeting to find ways to resolve the problems of this project. Here, the city leaders requested units to handle a series of problems of the project in November.

The Department of Transport shall preside over and coordinate with the Department of Construction to urgently review and grant licenses for underground cables and booms at Ben Nghe Tide Prevention Sluice to investors; the Department of Agriculture and Rural Development shall be responsible for completing the appraisal report on estimates, machine shifts and construction equipment for each item.

At the same time, the Department of Planning and Investment is assigned to preside over the review of the proposal of Trung Nam Company Limited on the proposed source of sand for the foundation of the project items. The Department needs to soon issue a document guiding investors to comply with regulations.

The City People's Committee leaders requested that in early November, units need to complete the review and confirmation of completed volume and project implementation volume.

Before November 15, the departments and the Urban Infrastructure Construction Investment Project Management Board need to review personnel and send them to the Department of Home Affairs to submit a decision to complete the personnel of the 10,000 billion VND flood prevention project working group.

The project to solve flooding caused by tides in Ho Chi Minh City area with consideration of climate change factors, phase 1, is invested by Trung Nam Construction Investment Joint Stock Company. The enterprise implementing the project is Trung Nam BT 1547 Company Limited.

The project belongs to group A; the investment form is public-private partnership (PPP); build-transfer (BT) contract, payment by land fund and Ho Chi Minh City budget.

The project's goal is to control flooding caused by high tides and proactively respond to climate change for an area of ​​570 square kilometers with about 6.5 million people in the right bank of the Saigon River and the center of Ho Chi Minh City.

Source: https://www.baogiaothong.vn/khong-the-tiep-tuc-huy-dong-von-du-an-chong-ngap-10000-ty-192241107172321727.htm