Coronavirus restrictions also take toll on $900m project in Hanoi
Construction of a 13 km railway between Cat Linh and Ha Dong in Hanoi, Vietnam’s first metro line, has been greatly delayed by discord between the government and the Chinese company undertaking the project.
Facilities are nearly complete. But the line, originally scheduled to begin service in September 2017, has yet to start operating.
Cat Linh Station, the largest of the railway’s 12 stations, was completed around a year ago. Parked cars and motorcycles fill the area under the elevated tracks at night, while homeless people sleep on makeshift beds. Roads nearby are stained, and slopes in the station are smeared with dust.
The roughly $900 million investment in the project in central Hanoi is heavily financed by Chinese official development assistance. China Railway Group unit China Railway Sixth Group is handling engineering, procurement, and construction.
Vietnamese Prime Minister Nguyen Xuan Phuc urged relevant government offices in early June to facilitate negotiations with the Chinese company, stressing that the new railway needs to be put into operation in 2020.
The government had rescheduled the project in a bid to begin service in April 2019, but to no avail.
Vietnam and China have offered different reasons for the delay. China Railway Sixth refused to submit safety reports needed to win Vietnamese approval to launch the line, according to local media, but the Chinese company argued that contract changes made the documents unnecessary. Now, with the documents apparently submitted in early July, a person familiar with the matter reports discord over payment.
The new coronavirus is also blamed. As Vietnam has imposed strict restrictions on foreigners’ entry, officials from a French company responsible for final examination of the railway’s safety are still unable to set foot in the country. In addition, some 30% of staff members at the railway operator have quit in the absence of work. Despite the prime minister’s call for opening the line by the end of this year, high hurdles continue to lie ahead.
Retailers and other businesses along the railway are fretting, as is the government. Aeon Mall opened its fifth Vietnamese location near Ha Dong Station in December, expecting service to have begun by then. “The delay is unexpectedly long,” an official at the Japanese company said.
Delays have plagued most of Vietnam’s nearly 20 plans for urban railway construction in Hanoi and Ho Chi Minh City. With traffic in the two cities worsening by the year, the government fears a drag on economic development.
Vietnam is the most anti-China country in Southeast Asia, owing to the disputed waters. Amid strong public interest in the rail line, eyes are on how the two countries will find common ground regarding the project.
Reporting by TOMOYA ONISHI, Nikkei staff writer | This story was originally posted on Nikkei