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Many super-projects in HCM City fail to meet deadlines

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The VND10 trillion tide-prevention project, Subway No 1, Belt Road No 2, and Thu Thiem 2 Bridge are huge projects that have not been completed, even though they kicked off many years ago.

Many super-projects in HCM City fail to meet deadlines

The VND10 trillion tide-prevention project

1. Tide prevention started in 2016, aiming to control floods caused by high tides and cope with climate change in an area of 750 square kilometers with 6.5 million people on the right side of Sai Gon River and the central area of the city.

The project was initially planned to be completed in April 2018 but it failed to meet the deadline (end of 2021) because of problems related to site clearance and refinancing.

In April 2021, the Prime Minister signed Resolution 40 which said HCM City has responsibility for completion of the project, and should make payments and check to remove unreasonable expenses. However, no progress has been made so far.

2. Metro No 1 (Ben Thanh – Suoi Tien), 20 kilometers long from Ben Thanh Depot in district 1 to Long Binh, kicked off in 2007 with the total estimate of VND17.387 trillion and plan to start operation in 2018.

However, the project has faced many delays because of the adjustment in investment capital, with capital tripling the initial level of VND47.325 trillion. The slow site clearance and disbursement are other reasons behind the delays.

The Management Authority for Urban Railways (MAUR) has admitted its failure to meet the deadline (the fourth quarter of 2021) and extended the deadline for two more years.

MAUR cited three reasons that caused the delay. First, the fourth Covid wave affected the execution of the project. Under the plan, 91 percent of the workload was supposed to be implemented by the end of 2021. However, the figure is 88 percent only.

Second, the procedures took time for signing the appendix of the consultancy contract No 19, which has important provisions such as consultancy, training staff and installing of the information technology (IT) system.

Third, the outstanding problems during project implementation. Metro No1 is one of the first urban railway projects in Vietnam that complies with foreign contract regulations, It has undergone many stages of adjustment of Vietnamese laws.

3. Under the design, Belt Road No 2, starting from Nguyen Van Linh in Binh Chanh, will circle around HCM City.

The route plays an important role in HCM City’s traffic, helping regulate traffic flow and ease traffic in inner city. The belt road, when completed, will create an ‘axis’ connecting other important routes, such as Hanoi and Pham Van Dong Highways, HCM City – Long Thanh – Dau Giay, Highways No 1 and No 13.

After many years of implementation, 50 kilometers of roads have been built, three kilometers are under execution, and the remaining 11 kilometers have not been implemented.

The road section from Pham Van Dong Road to Go Dua Intersection, 3 kilometers long, is implemented under the BT (build, transfer) mode, or exchanging land for infrastructure. The total estimate of the project is VND2.7 trillion, including expenses on site clearance.

The construction began in 2017 and was suspended in early 2020, with 44 percent of workload done. Explaining the delays, the investor said site clearance has gone too slowly, while it has had to wait for HCM City authorities to sign the contract appendix, adjust the project implementation, and conduct valuations of the land plots to make payment to the investor.

To date, Thu Duc city has handed over 74 percent of the total land area that needs site clearance.

4. Thu Thiem 2 Bridge connecting districts 1 and 2 is developed by Dai Quang Minh Real Estate under the BT mode with total investment capital of VND3 trillion.

The project has total length of 1.4 kilometers, including the cable-stayed bridge which is 885 meters long.

The bridge was expected to be completed by 2018, but failed to meet the deadline because of slow site clearance.

HCM City authorities later extended the deadline to September 2021. In the latest move, the deadline has been extended to April 30, 2022.

Other bridges in HCM City have also been implemented at a snail’s pace, including Tan Ky Tan Quy, Tang Long and Nam Ly. 

Tuan Kiet

Source: https://vietnamnet.vn/en/feature/many-super-projects-in-hcm-city-fail-to-meet-deadlines-806919.html

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Upgrading the market for the sake of all participants

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An employee passes electronic boards showing share prices inside Hồ Chí Minh Stock Exchange in HCM City. — VNA/ Photo Hữu Khoa

HÀ NỘI — An upgrade to emerging status will not only help the stock market develop quickly, transparently and sustainably, but also attract huge foreign capital inflows, said experts. 

Recently, the Government has directed to purge the market and improve the trading system’s capacity, showing its determination to enhance the quality of the stock market.

The refinement is to protect investors and open a door for the Vietnamese stock market to be upgraded from a frontier to an emerging market.

Prime Minister Phạm Minh Chính has taken an interest in the development of the capital market and the stock market, including the matter of upgrading the market. 

During a trip to attend the ASEAN-US Special Summit, on May 16, the PM visited the New York Stock Exchange (NYSE) – the largest stock exchange in the world – hoping it supports and shares experience to develop an effective and sustainable stock market in Việt Nam, and successfully build a regional financial centre. 

PM Chính also expected the NYSE and its Vietnamese partners to foster a sustainable, mutually beneficial partnership, contributing to making the Việt Nam-US comprehensive partnership more substantive and effective.

On the occasion, PM Chính witnessed the awarding ceremony of two cooperation documents in the fields of finance, banking and investment funds between Vietnamese and US partners, including a cooperation document between the Vietnamese State Securities Commission (SSC) and the NYSE regarding support to upgrade the country’s stock market and build a mechanism for investors to participate in both stock markets.

Previously, the PM chaired a conference on developing a safe, transparent, efficient and sustainable capital market to stabilise the macro-economy and ensure major balances of the economy.

At the conference, PM Chính also asked the Ministry of Finance to immediately solve the order congestion situation and invest in technological innovation and digital technology application, while urgently implementing measures to upgrade the market from frontier to emerging status to attract investment capital, especially foreign investment.

Dominic Scriven, head of the Việt Nam Business Forum’s (VBF) Capital Markets Working Group, said that the move to purify the market is a great effort and determination from the Government.

As the goal is to build and develop a safe, transparent and sustainable securities market, cleansing the market will ensure the interests of businesses and genuine investors, increase the stock market’s appeal, and attract more investment capital flows both at home and abroad.

Meanwhile, Phạm Lưu Hưng, chief economist of SSI Securities Company (SSI), said that the move to purge the market in recent years raised expectations that the upgrade process will be easier. Hưng hoped that in the next assessment, the Market Rating Organization (MSCI) will note some positive comments about what Việt Nam has done.

According to Minister of Finance Hồ Đức Phớc, the ministry is currently working with international organisations to deploy solutions to upgrade the stock market by 2025 as per the set roadmap.

Huge foreign capital inflows

Analysts believe that the upgrade from frontier to emerging status will be an important driving force for the market.

Zafer Mustafaoglu, World Bank (WB) Practice Manager for Finance, Competitiveness and Innovation (FCI) for East Asia and Pacific, said that the capital market development is a long-term effort, and there is still much work to be done in Việt Nam.

Upgrading to emerging market status is not only an improvement in position, but also signals strong enhancement in quality with a solid market foundation.

Upgrading to an emerging market also attracts the attention of high-ranking international investors to Việt Nam. In the stock market, upgrading to an emerging market could result in an additional US$10 billion in new investment for the country. The first year alone can receive an additional $2-5 billion.

According to Nguyễn Minh Tuần, General Director of AFA Capital Investment JSC, the criteria for upgrading from frontier to emerging status focus on two main factors – size and liquidity of the market (quantitative) and market access (qualitative).

In terms of size and liquidity, there are four criteria which are the number of companies included in the Standard Index, total market capitalisation, floating capitalisation and market liquidity. Việt Nam has almost met three standards, he said. 

The main issue is qualitative standards. In the latest ranking in June 2021, there are nine criteria that the country has not yet met, including the ownership rate, ownership restrictions and equal rights of foreign investors.

Source: https://vietnamnews.vn/economy/1194077/upgrading-the-market-for-the-sake-of-all-participants.html

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EVN accelerating projects to gear up for hot season

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EVN workers checks electricity equipment. — VNA/  Photo

HÀ NỘI — Vietnam Electricity (EVN) said it is accelerating power generation and grid projects, especially urgent infrastructure, to ensure supplies in the hot season.

The State-owned group said in the first four months of 2022, the firm and its subsidiaries had started work on 30 projects and put into use 31 grid facilities between 110kV – 500kV.

It cited meteorological forecasting centres as saying that heatwaves this year are likely to appear in the northern and central regions later than usual, but won’t be too severe.

Power demand in the north is unlikely to rise sharply in May, and daily consumption will be around 805 million kWh.

EVN noted that this month, it is working to guarantee supply for production and business activities as well as daily life, especially the 31st Southeast Asian Games (SEA Games 31) and the 15th National Assembly’s third session.

It is maintaining high water levels at multi-purpose hydropower plants in the north, operating thermal power plants in the region, and importing about 540MW of electricity in May.

Its subsidiaries were also requested to ensure power supply in the dry season, ready manpower and equipment for any possible incidents due to natural disasters, and recommend people, agencies and factories use electricity in a safe and economical manner.

In April, the entire EVN system produced 22.62 billion kWh of electricity, up 1.9 per cent year-on-year. That added up to a four-month figure of 85.65 billion kWh, increasing 6.2 per cent. —

Source: https://vietnamnews.vn/economy/1194045/evn-accelerating-projects-to-gear-up-for-hot-season.html

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Deputy Finance Minister Nguyễn Đức Chi takes charge of the State Securities Commission

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Deputy Finance Minister Nguyễn Đức Chi. — Photo vtv.vn

HÀ NỘI — Minister of Finance Hồ Đức Phớc had assigned Deputy Finance Minister Nguyễn Đức Chi to take charge of the State Securities Commission (SSC) from May 19.

In a dispatch to the SSC, Minister Phớc stated that Deputy Minister Chi will manage the commission during the consideration and completion of personnel for the commission.

Earlier on May 18, the Party Central Committee’s Inspection Commission announced the inspection conclusions and Party disciplinary measures on the SSC Party Committee in the 2015-20 tenure and relevant individuals. Right after that, the Ministry of Finance directed the SSC, stock exchanges, the Việt Nam Securities Depository and relevant agencies to review and implement measures to remedy the violations and shortcomings.

Specifically, the ministry dismissed Trần Văn Dũng from the position of the Chairman of the SSC, while giving a warning to Vũ Bằng, former secretary of the SSC Party Committee in the 2015-20 tenure and former SSC Chairman.

Warnings were given to Nguyễn Thành Long, secretary of the Hà Nội Stock Exchange Party Committee; and Nguyễn Sơn, chairman of the management board of the Việt Nam Securities Depository for their wrongdoings during their tenures. —

Source: https://vietnamnews.vn/economy/1194041/deputy-finance-minister-nguyen-duc-chi-takes-charge-of-the-state-securities-commission.html

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