Japanese contractor demands compensation for metro cost blow out
A Japanese contractor wants daily compensation of VND2.5bn (USD119,000) after Vietnam authorities failed to make available a contracted construction site in Binh Duong Province.
HCM City's Ben Thanh-Suoi Tien Metro Project under construction.
Sumitomo Corp won the contract to build a metro line connecting HCM City's Ben Thanh Market with Suoi Tien Park, which runs through Di An Town in neigbouring Binh Duong Province. It's winning bid costed the projected at VND47 trillion.
But a condition of the contract was that Vietnamese authorities make land available to build the line.
Authorities allege Vinh Phat Commerce and Service Company, which holds two hectares of land in the project area, was offered VND125bn to sell, but it rejected the offer and has filed claims for more compensation.
Sumitomo charges it cannot proceed with the project until the land issue is resolved and is seeking VND2.5bn for every day work is stalled. The project is reportedly now 30 months behind schedule.
On December 16, vice chairman of HCM City People's Committee sent official document, urging authorities of Binh Duong Province to quickly deal with the issue.
Binh Duong Province responded that, if the land is not released by the end of December, they would proceed with the forced eviction.
The Ben Thanh Market-Suoi Tien Park metro project was scheduled for completion in 2019. The HCM City People's Committee is reviewing the project schedule.