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The Metro on a test run departs from Ba Son Station and heads towards Thu Duc City. |
The metro is a large-scale public transportation system powered by electricity. When operational, it not only helps Ho Chi Minh City solve its transportation challenges but also contributes to environmental protection. However, according to the HCMC Management Authority for Urban Railways (MAUR), Metro Line No.1 Ben Thanh - Suoi Tien is currently 97 percent complete, yet the exact commencement date for operational service has not been determined.
The construction of Metro Line No.1 Ben Thanh - Suoi Tien commenced in August 2012 with an initial plan to start operations after six years. However, during its implementation, the project continuously encountered difficulties related to procedures and funding, leading to a prolonged state of stagnation that has extended for more than 11 years without completion. When the city approved the project in 2007, it had a total capital exceeding VND17 trillion, fell into category A, and did not require submission to the National Assembly for policy approval.
Two years later, the project underwent a reevaluation by the consulting unit, leading to a substantial increase in the total investment to VND47.3 trillion. Of this amount, the Japan International Cooperation Agency (JICA) provided funding of over VND41.8 trillion, while the remaining funds were allocated from the city budget.
In 2011, the Prime Minister granted approval to the HCMC People's Committee for project adjustments. However, due to subsequent policy changes, the project had to be presented to the National Assembly for investment principle approval. Therefore, it was not until the end of 2019 that the National Assembly ultimately approved the adjusted total investment for the project, reducing it by over VND3 trillion compared to the initial estimate.
Furthermore, according to MAUR, some aspects related to the execution of Contract Package No.3 (CP3) have not been fully addressed by the contractor Hitachi, or there have not been any solutions to tackle difficulties and fulfill the tasks. Specifically, regarding the utilization of project equipment for the training activities of the general consultant (NJPT), there are divergent perspectives and interpretations between Hitachi and NJPT, creating challenges for MAUR in continuing the preparations for the upcoming trial operation.
In this regard, Hitachi is requesting additional costs associated with the early use of the railway system to support the training activities of the project. Meanwhile, NJPT affirms that the train driving training, conducted by NJPT instructors, utilizes the explicitly designated main route specified in the CP3. It is the contractor's responsibility to collaborate with NJPT without incurring any additional cost payments beyond the allocated expense distribution.
Besides, Hitachi maintains that they are solely accountable for the integrated testing of the systems related to the CP3, disclaiming responsibility for the comprehensive testing and trial operation of the entire system. In response, NJPT insists that, in accordance with the terms of the CP3, Hitachi is obliged to integrate with the works of other contractors and formulate a comprehensive testing and operational plan. Simultaneously, the contractor must adhere to any directives issued by the investor's representative, NJPT.
Concerning the draft proposal and the progression towards finalization and signing of a 5-year contract for operation and maintenance tasks, MAUR already mentioned it with Hitachi in 2022 and held several meetings with the leadership of Hitachi Japan and Hitachi Office in HCMC in early July 2023. Since then, despite MAUR's repeated suggestions for Hitachi to engage in meetings to exchange views and expedite the resolution of this matter, Hitachi has consistently declined these meetings, citing reasons such as being "unprepared" for the discussions.
In addition, there are numerous challenges and obstacles in restructuring the values of items within the VN15-P5 Loan Agreement. On August 10, 2023, the Ministry of Finance sought opinions from the Ministry of Planning and Investment, the Ministry of Foreign Affairs, the Ministry of Justice, and the People's Committee of HCMC to modify the structure of items in the VN15-P5 Loan Agreement (Dispatch No.8547/BTC-QLN). As of now, only the Ministry of Planning and Investment and the People's Committee of HCMC have provided feedback, while the Ministry of Foreign Affairs and the Ministry of Justice have not yet offered their perspectives.
As for the management and maintenance procedures for urban railway infrastructure, the government has enacted Decree No.46/2018/ND-CP, which outlines the regulations for managing, using, and operating national railway infrastructure assets, and Decree No.56/2018/ND-CP, which specifies the management and protection of railway infrastructure. However, as of now, the relevant ministries have not provided guidance as a basis for implementation and execution.
The HCMC People's Committee has urged the Ministry of Transport and the Ministry of Finance to promptly review and provide feedback on the draft regulations governing the management and maintenance of urban railway infrastructure in HCMC. The city has also called for the timely issuance of guidelines for the establishment of regulations on the management, maintenance, and operation of urban railway infrastructure as the basis for implementation. Another notable entanglement is related to technical standards and price indices.
On July 13, 2023, the People's Committee of HCMC recommended that the Ministry of Construction review and offer guidance on the approval process for fire prevention designs. Additionally, it proposed the promulgation of domestic construction price indices to facilitate the adjustment of contract prices.
The MAUR asserts that in the event the mentioned issues remain unresolved or experience delays in resolution, trial operation and commercial deployment of Metro Line No.1 Ben Thanh - Suoi Tien may encounter difficulties in adhering to the planned schedule.
