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Ambitious works plan unveiled
The Transport Ministry intends to disburse VND25,365 billion ($1.5 billion) for capital works this year.
Deputy Transport Minister Ngo Thinh Duc concedes that although the total is ambitious, his ministry is determined to make the best use possible of the money.
The ministry’s Planning and Investment Department director Truong Tan Vien says $286.2 million of the money will be used for 29 Official Development Assistance, ODA, projects; $588.2 million for 31 projects financed through government bonds and $206 million for 52 projects financed through the State budget.
In addition, the Investment and Planning and Finance ministries have asked the government to advance VND3.5 billion from 2010 budget, he says.
Transport Minister Ho Nghia Dung says the amount allocated for transport projects this year has increased by VND15,000 billion or 30 per cent compared with 2009.
"If all goes according to plan, the $1.5 billion for 2009 will be the most so far," he says.
Deputy Transport Minister Ngo Duc Thinh says the amount of work the ministry has programmed for this year will total much more than the Government’s stimulus of $1 billion.
"The programme will provide an opportunity for contractors, including State-owned construction corporations, joint stock and private companies," he says.
The second phase of the Ho Chi Minh Highway will require bids for 52 packages in a total budget of almost VND10,000 billion.
Optimism
Transport Construction Corporation (Cienco) director general Than Duc Nam told reporters that he was optimistic about the planned disbursement.
"The more work we undertake, the more we’ll benefit if we have sound construction plans," he said.
The director general gave the following reasons for his optimism.
The first was the low-interest loans now available and the fall in the cost of materials and fuel.
"The government’s decision to subsidise the interest charge has lowered the interest cost to 4-6 per cent," he said.
The second was the effective application of the Government’s price adjustment mechanism.
The Transport Ministry has also decided to increase the advanced money to the level of 80 per cent of the semi-completed work while streamlining administrative procedures in the settlement of the balance.
But other contractors are anxious about new difficulties with capital works that have arisen since the last quarter of 2008.
They say many major Build, Operate and Transfer, or BOT, projects undertaken by domestic investors have been delayed because the project’s organisers are incompetent or do not have enough capital.
But not many investors have expressed their intention to participate in bidding for ODA-funded bridge, roads and port projects.
And the few to participate had lodged bids 20-30 per cent higher than the nominated cost.
Construction Management and Quality Control of Transport projects director Tran Quoc Viet says foreign investors are not interested in transport projects because: "The fluctuation in the price of construction materials and the delay in land clearance have deterred foreign investors."
"That’s the key reason that many major projects, including the Nhat Tan bridge – across the Red River in Ha Noi; the Ha Noi-Thai Nguyen express way and the Van Phong port have been delayed," he says.
VietNamNet, VNS
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