HCMC – The cash-strapped Metro Line No. 1 management company will receive additional funding to increase its charter capital to VND268 billion in the third quarter of this year.
Deputy Prime Minister Le Minh Khai concluded on July 1 that the government of HCMC has the authority to approve the charter capital of Ho Chi Minh City Urban Railways No.1 Company Limited (HURC1), which manages Metro Line No. 1 between Ben Thanh Market and Suoi Tien Theme Park.
The city government is empowered to provide funding to the company, thus facilitating the preparation process, including personnel training and technology transfer for the urban rail line’s operations.
This approach follows the prime minister’s meeting with the city and relevant ministries to address the capital shortage faced by HURC1, which has experienced financial constraints over the past two years.
The city is required to adhere to the project schedule in approving the increase in HURC1’s charter capital, as well as meet the legal capital requirements for a 100% state-owned company.
Earlier, the HCMC People’s Committee sought permission to actively allocate capital for the company based on its needs and the schedule of asset handover from the 20-kilometer Metro Line No. 1, instead of relying on periodic allocations.
As per the approved capital allocation plan by the Government, the city will provide VND268 billion to HURC1, including the VND14 billion previously allocated to the company. After this year, the city has the discretion to increase the company’s charter capital, not exceeding a maximum of VND16,802 billion.
HURC1 was established in 2015 by the HCMC People’s Committee to prepare personnel for the management and operation of the Ben Thanh-Suoi Tien metro line, which was originally planned to be completed in 2018.
The company received VND14 billion for the period of 2015-2014 to streamline the preparation process for the metro line’s operation. Starting in 2018, the company’s charter capital was set at VND16,788 billion.
Metro Line No. 1 is HCMC’s first urban railway project, with a total cost of over VND43,700 billion. The project is now 95% complete. The metro line is expected to be completed by the end of this year.
