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HCMC proposes solutions to remove hindrances to flood control project

The Saigon Times

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HCMC – HCMC has put forth solutions to cope with hinderances to a VND10-trillion flood control project, as outlined in a recent report submitted to the central Government.

According to the HCMC People’s Committee, the city cannot make payments to the project investor, Trungnam BT 1547, while the project is not yet completed. The company is running short of funds to continue construction work.

Speaking at a meeting yesterday (October 10) with voters in HCMC ahead of the National Assembly’s next session slated from October 23 to November 29, 2023, HCMC Chairman Phan Van Mai said the project is more than 90% complete, and that to get the remaining construction work done, an extra VND1.8 trillion would be needed.

The total amount of capital for public investment allocated for this year by the central Government is VND68 trillion, Mai said, adding the city has set aside VND5.7 trillion from this sum to pay for the flood control project.

However, the city has not been able to pay for the investor because the project has not been fully completed, he noted.

Long delays might send the total cost of the project soaring to over VND13.2 trillion, according to the report sent to the central Government.

The report said HCMC proposed three solutions for paying for the investor. First, the city would compensate the investor for the already-completed components using both cash and land. For cash payments, the city has suggested that BIDV, a state-owned commercial bank, freeze its debt collection from the investor and at the same time, provide it with a new loan to complete the project.

Second, the HCMC Finance and Investment State-Owned Company (HFIC) would offer financing to the investor to continue work on the project. Third, HFIC would be entrusted with a VND1,800 billion budget by the city government so that it can refinance the investor.

Following the takeover of the project, the city would make payments to the investor in accordance with the signed build-transfer (BT) contract. The investor would then settle its debts with HFIC, which will reimburse the city budget.

After a thorough review, the city has determined that the third option is the most practical solution as it complies with prevailing regulations.

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