Ho Chi Minh City commits to having enough capital to invest in 2 drainage projects

Ho Chi Minh City committed to arranging enough counterpart funds to soon start two drainage projects in 2025, with a total investment of more than VND16,500 billion.

Borrowed more than 700 million USD from ADB

Earlier this year, the Management Board of Ho Chi Minh City Urban Infrastructure Construction Investment Projects submitted a report to the City People's Committee on investing in two projects: Project to Improve Drainage, Wastewater and Climate Change Adaptation in Tham Luong - Ben Cat Basin (CRUS 1) and Project to Improve Drainage, Wastewater and Climate Change Adaptation in West Saigon Basin (CRUS 2).

For the CRUS 1 Project, Ho Chi Minh City will build a sewer system to transport wastewater to the Tham Luong - Ben Cat wastewater treatment plant, which has completed phase I with a treatment capacity of 131,000 m3/day and night; phase II with a treatment capacity of 250,000 m3/day and night. At the same time, the Vam Thuat tidal sluice, the Nuoc Len tidal sluice, and the main and branch wastewater collection sewer system in Go Vap district and part of district 12 will be built.

The CRUS 1 project has a total investment capital of VND8,311 billion (equivalent to USD352 million), of which the loan capital from the Asian Development Bank (ADB) is USD227 million, and the counterpart capital of Ho Chi Minh City is USD119 million (equivalent to VND2,816 billion). After completion, the project will reduce flooding and improve the environment for 7 districts.

The CRUS 2 project has a total investment of VND8,264 billion (equivalent to USD350 million). In this project, ADB's loan capital is USD236 million, equivalent to VND5,588 billion, the remaining is Ho Chi Minh City's counterpart capital of VND2,675 billion, equivalent to USD113 million. The project's goal is to build a wastewater and drainage system in 5 districts: District 12, Go Vap, Tan Binh, Tan Phu, Binh Tan.

Both projects are expected to be implemented from 2024 to 2029.

Enough capital to start project in 2025

Although the above submission clearly stated that the investment capital comes from loans and counterpart funds from the budget, the capital arrangement for each phase has not been clarified. When appraising the Project, the Ministry of Planning and Investment requested Ho Chi Minh City to clarify the medium-term capital balance for the Project in the two phases of 2021-2025 and 2026-2030.

On May 31, 2024, Mr. Pham Trung Kien, Deputy Director of the Department of Planning and Investment of Ho Chi Minh City signed Document No. 6839/SKHDT-PPP to the Ministry of Planning and Investment to clarify the balance of investment capital for each stage.

The Department of Planning and Investment said that, based on a preliminary review of projects that have been implemented in the 2021-2025 period, but have not fully utilized the allocated capital due to price reduction through bidding, reduction in compensation and site clearance costs, and failure to use contingency costs, etc., with a capital of about VND 16,056 billion, the Ho Chi Minh City People's Council has approved the plan to adjust medium-term public investment capital for the 2021-2025 period, so from 2024 to 2025, VND 457.6 billion will be allocated to the CRUS 1 Project and VND 370.4 billion to the CRUS 2 Project.

In addition, the Ho Chi Minh City Green Transport Development Project (investment capital of VND 2,392 billion) is being reported by the City to the Prime Minister for permission to stop implementation according to the opinion of the sponsor, the World Bank (WB) because the signed Credit Agreement will expire in December 2024. Therefore, the capital from this project that can be transferred to the CRUS 2 Project is VND 836.3 billion, and the CRUS 1 Project is VND 443.3 billion.

Similarly, in the period 2026 - 2030, by the time of capital appraisal and capital balance capability (foreign capital and counterpart capital) for the two projects, all must comply with the provisions of Clause 2, Article 89 of the Law on Public Investment.

Therefore, the Department of Planning and Investment of Ho Chi Minh City recommends that the Ministry of Planning and Investment pay attention to support and promptly consider providing appraisal opinions and report to the Prime Minister for consideration and approval of the investment policy of the Project.

On June 13, 2024, the Department of Planning and Investment of Ho Chi Minh City issued Document No. 7441/SKHDT-PPP to the People's Committee of Ho Chi Minh City, proposing that the City recommend the Prime Minister to consider and decide on the investment policy of the CRUS 1 Project and the CRUS 2 Project because the Project's dossier has fully received and clarified the contents requested by specialized agencies.

According to the Plan for implementing the Ho Chi Minh City Flood Control and Wastewater Treatment Program for the period 2024 - 2025, which was recently issued by Ho Chi Minh City, CRUS 1 and CRUS 2 are projects on the list of projects to be accelerated to start construction in 2025.

Source: https://baodautu.vn/tphcm-cam-ket-co-du-von-dau-tu-2-du-an-thoat-nuoc-d217800.html