Ho Chi Minh City chairman Nguyen Thanh Phong has promised to use the city’s own money to pay Japanese contractors working on a project to build its first metro line before the Lunar New Year while waiting for budget allocation from the central government.

Phong made the pledge at a meeting on Friday afternoon with Toshiko Abe, Japanese State Minister for Foreign Affairs, during the latter’s working visit to the southern metropolis.

Development for the Ben Thanh – Suoi Tien metro line, which began in 2007 using official development assistance (ODA) loans from Japan, stands as a testament to Vietnam-Japan cooperation, Phong said.

However, due to multiple procedural challenges including approval of the project’s adjusted investment plan, payment of Japanese contractors involved in developing the metro line had been delayed, he elaborated.

While waiting for the new budget to be approved, Ho Chi Minh City will spend around VND2 trillion (US$86 million) of its own money paying the Japanese contractors, Phong said.

“The city and relevant bodies are in the final steps of getting the budget disbursed,” he said.

“We will try our best to pay any unpaid contractors’ wage before entering the Tet holiday, which means by February 1, 2019,” Phong pledged.

Chairman of the People’s Committee of Ho Chi Minh City Nguyen Thanh Phong speaks at a meeting with a delegation of Japanese officials in Ho Chi Minh City on January 18, 2019. Photo: Duy Linh / Tuoi Tre

Other remaining obstacles slowing down development of the metro line will also be resolved in the fastest manner on the principle of protecting the contractors’ rights and interests, with the ultimate goal being to have the line ready and start operations at the end of 2020 as planned, the Ho Chi Minh City chairman said.

In a letter sent to the city’s Party chief Nguyen Thien Nhan late last year, Japanese Ambassador to Vietnam Umeka Kunio said unpaid contractors’ wage had amounted to more than $100 million as of November 2018.

The Japanese ambassador warned “constructions on the project will have to be halted” if the issue is not resolved by the end of 2018.

The first metro line in Ho Chi Minh City runs nearly 20 kilometers from Ben Thanh Market in the downtown area to the Suoi Tien Theme Park in District 9.

It is estimated to cost VND47.3 trillion ($2 billion) in investment capital, and will be capable of transporting 620,000 passengers per day upon completion.

Japanese State Minister for Foreign Affairs Toshiko Abe speaks at a meeting with the Ho Chi Minh City administration in Ho Chi Minh City on January 18, 2019. Photo: Duy Linh / Tuoi Tre

In response to chairman Phong’s uplifting promise, Japanese State Minister for Foreign Affairs Toshiko Abe said “thank you” in Vietnamese and said she considers the gesture a meaningful Lunar New Year present that the city had prepared for the Japanese government and businesses.

“Yesterday, when I arrived in Hanoi, I visited the Vietnam Military Hisotry Museum and was really moved and humbled by the perseverance of Vietnamese soldiers and people during the war,” Abe said.

“It gave me faith in Vietnam, that with determination your country can have anything done despite the difficulties,” she said.

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