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Speed up transportation projects to avoid cost overruns: parliament members

An artist impression of the Long Thanh International Airport in Dong Nai province, Vietnam.
An artist impression of the Long Thanh International Airport in Dong Nai province, Vietnam.

National Assembly deputies Friday called for faster implementation of transportation projects to avoid cost overruns caused by huge delays.
Duong Trung Quoc, a National Assembly (NA) member from Dong Nai, expressed concerns over signs of delay in the construction of the Long Thanh International Airport in the southern province.

“Funding for the project is ready, but the people are still waiting for it to be deployed,” Quoc said, adding that the project’s feasibility report has not been approved after the NA discussed it in May.

The longer a project is delayed, the more complicated and difficult it will become in terms of budgeting, Quoc said.

The Long Thanh Airport, built in three phases over three decades, is set to become Vietnam’s largest airport.

The first part is scheduled for completion in 2025, when the new airport will be able to handle 25 million passengers a year. The next two phases will run from 2030 to 2035 and from 2040 to 2050.

Investment in the first phase is estimated at VND114 trillion ($4.87 billion), sourced from the state budget, government bonds and private equity.

Experts have previously warned that the construction cost of the airport could double every five years.

Quoc also cited the first metro lines in Hanoi and Ho Chi Minh City as examples of delayed transport infrastructure projects that have become more expensive, putting greater burdens on the taxpayer.

Ho Chi Minh City’s first metro has been delayed due to lack of funds, the same reason given for several earlier delays since construction began in August 2012.

The line runs 20 kilometers (12.43 miles) through five HCMC districts of 1, 2, 9, Binh Thanh and Thu Duc and Di An District in the neighboring province of Binh Duong.

The estimated cost of the line has ballooned from $1.3 billion to more than $2.1 billion, and the city needs to wait for the NA to approve this.

The Cat Linh-Ha Dong metro line, which runs 13 kilometers from Ha Dong District to Dong Da District in Hanoi, is in a similar situation. Work on the elevated railway in Hanoi started in October 2011 and was originally scheduled for completion in 2013.

But several hurdles, including loan disbursement issues with China that were only resolved last December, have been stalling the project for years before the first trial run was launched last month.

The original cost estimate of $552.86 million has also ballooned to more than $868 million, including $670 million in loans from China.

Other NA deputies at the meeting expressed concerns over the cost overruns.

Nguyen Huu Cau, Public Security Director of central Nghe An Province, said that 27 of 42 projects of the Ministry of Transport have increased their original budget estimates by a total of $97.2 million, according to the Vietnam State Audit Office.

Increasing budgets and delayed projects make huge losses more likely and the government should strictly punish these violations, Cau said.

Vietnam has several major big budget transportation projects in the pipeline, including the north-south expressway, the high-speed north-south railway and the upgrade of 16 civillian airports.