Transport minister firm on Keangnam delay
Transport minister firm on Keangnam delay
The two final packages for the northern Noi Bai-Lao Cai expressway may soon have the capital necessary for completion. State-owned Vietnam Expressway Corporation (VEC) deputy general director Le Kim Thanh said that Korea’s Keangnam Enterprises, which developed the final A4 and A5 development packages of the expressway, had transferred $4 million from South Korea to pay cash-strapped sub-contractors.
The Noi Bai-Lao Cai expressway runs through Hanoi, Vinh Phuc, Phu Tho, Yen Bai and Lao Cai
Keangnam planned to transfer another $6 million in the coming time to boost construction of the packages, so the expressway could open by late August this year, Thanh added.
Keangnam’s motivation to supply the financing came after a stern warning by the Minister of Transport Dinh La Thang who told the company’s representatives in a meeting late last month that if the company failed to transfer the funds to Vietnam to complete the packages, VEC’s contract would be immediately terminated.
Before issuing his ultimatum, Thang personally examined implementation of the packages, which he determined to be slow and not likely to hit the August deadline, as previously committed by Keangnam. He noted that a particular part of the under-construction road he saw had yet to lay any base or sub-base, despite the looming deadline.
He reported that the 41.15 kilometre A5 package in the northern province of Yen Bai, around 26 per cent of the project still uncompleted.
VEC’s general director Mai Tuan Anh said that the South Korean side had previously pledged to pump $10 million into the packages to ensure construction finished before June 30, but the funds never arrived. “VEC has asked Keangnam Enterprises’ president to visit Vietnam to discuss the packages, but we have seen no co-operation from their side. Only the company’s vice president paid a visit, and no cash has been transferred so far,” Anh said.
The A4 and A5 packages were inked in early June 2010 in Hanoi between VEC and Keangnam Enterprises. Under the contract, construction was due to be completed within 36 months.
Transport minister Thang added to his warning that if the packages failed to be completed by August 31, this would constitute grounds for dismissal of certain VEC leaders. He also ordered that Keangnam’s work would be reduced to only five kilometres while the remainder would be taken over by the ministry’s Cienco 1, Cienco 4 and Van Cuong Company. The 264km expressway includes eight construction packages and two equipment installation packages, with the total investment capital of nearly VND20 trillion ($952.4 million) for the first stage. It started construction in the third quarter of 2008 and runs through Hanoi as well as four other provinces – Vinh Phuc, Phu Tho, Yen Bai and Lao Cai.
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