On September 24, Chairman of the Ho Chi Minh City People's Committee Phan Van Mai signed document No. 271/BC-UBND proposing to the Prime Minister a plan to remove obstacles in the Project to Solve Flooding Due to Tides in Ho Chi Minh City Area Considering Climate Change Factors - Phase 1 (also known as the 10,000 Billion VND Flood Prevention Project).

According to the Ho Chi Minh City People's Committee, the project is currently facing difficulties due to lack of funding to complete the remaining part of the project.

The reason is that BIDV Bank did not sign the credit contract appendix with Trung Nam BT 1547 Company Limited. Therefore, it is not possible to submit to the State Bank of Vietnam to extend the refinancing disbursement time.

The project to solve tidal flooding in Ho Chi Minh City area takes into account climate change factors, phase I has stopped construction since 2020 until now due to unpaid BT land fund - Photo: TN

To have capital to continue the construction, the Ho Chi Minh City People's Committee once proposed that the Government's Working Group unify the plan and consider submitting it to the Government for approval to entrust the City with the budget to the City State Financial Investment Company (HFIC) . From there, HFIC lent the investor to complete the project because the progress has now reached more than 90%.

However, the Ministry of Finance commented that the proposed plan of Ho Chi Minh City is not suitable because the State Budget Law 2015 does not have regulations on the use of local budget capital to entrust HFIC so that this fund can lend to investors to implement the project.

The next difficulty is that there is no basis for payment of BT contracts because current regulations are not unified, leading to legal problems in adjusting the project.

Therefore, the Ho Chi Minh City People's Committee proposed a solution to allow the City to adjust the project because the total investment of the project has changed, the project implementation time has expired, and there are some shortcomings in the contract signing and implementation.

Because project adjustment takes a long time, the Ho Chi Minh City People's Committee proposed to simultaneously carry out procedures to adjust the project implementation time as a basis for signing the BT Contract Appendix to change the payment method.

After adjusting the BT Contract Appendix, the project basically overcomes the shortcomings stated in Article 1 of Resolution No. 40/NQ-CP dated April 1, 2021.

This is the basis for the City to start making payments using land funds, which are the land plots identified in the BT Contract according to current regulations, to solve the capital source for the Investor to construct the remaining part of the project and reduce the cost of interest incurred while waiting for the completion of project adjustment procedures.