VietNamNet Bridge – The HCMC government has asked the Government for approval to advance VND300 billion (some US$13.8 million) for dredging and maintaining the Soai Rap River to make it easier for vessels to enter ports in the city.

A container vessel travels in the Soai Rap River. According to the HCMC government, the river is important to goods transport in the city and between the city and neighboring provinces – Photo: Anh Quan

According to the municipal government, the river is important to goods transport in the city and between the city and neighboring localities. However, the river needs to be dredged as the annual buildup of alluvial soil in the river is huge, at around 2.5 million cubic meters a year.

The city put the annual cost of maintaining and dredging the river to facilitate goods transport at VND334 billion. But the Ministry of Transport has not allocated capital for dredging the Soai Rap River in its waterway maintenance plan.

The ministry has agreed HCMC’s plan to have the waterway dredged this year at a cost of around VND300 billion to be advanced from the city’s budget.

In order to keep Soai Rap deep enough for big vessels to travel in the long term, the city has proposed the Government allow it to fund the dredging of the river on its own and retain all navigation fee revenues from vessels using the river.

The Soai Rap River, which is 54 kilometers long, is one of the key waterways for vessels to enter ports in HCMC. Dredging the passage to a depth of 9.5 meters for ships of 30,000-50,000 DWTs was finished in June last year and the dredging cost totaled VND2.8 trillion, with over VND2 trillion sourced from Belgium’s ODA loan and the remainder from HCMC’s reciprocal capital.

But Rashid Abdulla, senior vice president and managing director for Asia Pacific at DP World which holds an 80% stake at Saigon Premier Container Terminal (SPCT), the depth is no longer 9.5 meters at some points since last November.

In a recent letter sent to the HCMC government, Abdulla said after phase one of the Soai Rap dredging project finished, SPCT got much positive feedback from shipping lines and some international lines started to send larger vessels to HCMC via the Soai Rap River.

However, some shipping lines have put on hold plans to sail bigger vessels to SPCT due to some shallow parts in the estuary of the Soai Rap and Vam Co rivers, affecting the terminal’s operations.

Since last November, SPCT has lost 6,000 TEUs a month after shipping line NYK decided to shift its vessels to other ports. Other shipping firms like CMA, MSC and Huyndai have delayed sending bigger vessels to SPCT for fear of the shallow parts.

If the Soai Rap River is not dredged quickly, there is no reason for shipping lines to use the passage and SPCT, and DP World is concerned about this, Abdulla said in the letter.

Replying to the investor’s feedback, HCMC chairman Le Hoang Quan last week assigned the Department of Transport to prepare procedures for the passage dredging project to move forward.

The Southern Vietnam Maritime Safety Corporation reported last April that there had been some shallow parts spotted in the Soai Rap River.

SPCT is a joint venture between DP World and Vietnam’s Tan Thuan Industrial Promotion Company Limited (IPC). The terminal lies by the Soai Rap River and 15 kilometers from the city downtown.

In April 2014, the first container ship sailed to SPCT via the river, which is the shortest waterway to enter the city from the East Sea.

Cargo throughput at ports in HCMC was 44.45 million tons in the first half of this year, up 12.5% over the same period a year ago. The figure is forecast to reach 100 million tons by year-end and 150 million tons in 2020.