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Tue September 28 2021

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Construction costs soar in Vietnamese city

23 Jul 18 There have been huge cost hikes and other problems in construction projects the Vietnamese city of Hải Phòng, a government investigation has found.

Most construction projects in the northern port city of Hải Phòng are running well above their initial cost estimates, with the cost hikes in some cases reaching thousands of billions of VND – tens of millions of pounds.

The findings were announced by the Government Inspectorate after it completed an inspection on the implementation of construction investment management regulations in Hai Phong for the 2017-2020 period. The inspectorate has proposed that investment capital for many projects be reduced. It is also suggested that relevant Hai Phong city’s authorities be disciplined for the violations and problems it found.

The cost of a project to upgrade the city’s Road 356 in the city, which was approved in 2010 with total investment of VND315bn (£10.4bn), increased to almost VND1.3 trillion.

Another project, Dinh Vu Sea Dyke, approved in 2010 with investment of VND998bn (£33m), saw a cost hike of more than VND3.2 trillion (£106m).

The southeastern ring road of Hai An district was approved in 2009 at a cost of VND886bn but was adjusted to more than VND2 trillion in 2012.

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According to the Government Inspectorate, all of these projects’ costs were adjusted from time to time and their construction time lengthened from four to seven years.

Examination of contractors’ competence revealed that many selected contractors were not capable of implementing the projects, the inspectorate found. Hai Phong city’s authorities had made efforts to carry out state management over construction quality, the recent inspection discovered a number of quality and progress problems, it said.

Land clearance delays also caused tardiness in many projects.

Meanwhile, many projects were approved without an evaluation report on environmental impact, such as the construction of the main road in Dinh Vu Industrial Zone, the Dinh Vu Sea Dyke Project and the Ngo Quyen district resettlement project, said the inspectors.

Investors in some projects reportedly portrayed their projects as urgent in order to shorten all bidding and contractor-selection procedures. However, the inspection team found out that these projects turned out otherwise.

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