Vietnam turns down Chinese Hanoi-metro rail contractor demand for advance payment

Construction News Vietnam
A train seen on the railway of the Cat Linh – Ha Dong Metro Section in Hanoi. Photo by VnExpress/Giang Huy.

Vietnam turns down Chinese Hanoi-metro rail contractor demand for advance payment

Vietnam has refused to pay the Chinese company building its first metro route the $50 million it wants in advance to test run trains.

Deputy Minister of Transport Nguyen Ngoc Dong told reporters on Tuesday that Vietnam has been making payments on schedule to China Railway Sixth Group Co Ltd for the Cat Linh – Ha Dong route in Hanoi, and so the request, made at a recent meeting, would not be met.

“Even if the Chinese contractor has financial difficulties, it has to test run the train. Vietnam does not have any responsibility to pay this money.”

Vietnam has so far paid 78 percent of the contracted amount and the rest would be paid just before the contractor hands over the project, he added. But it remains unclear when this handover will happen.

More than 150 Chinese experts needed for the remaining work have not been able to enter Vietnam since the novel coronavirus broke out in China earlier this year.

They are set to come this month and will be quarantined for 14 days, according to the Hanoi Metropolitan Railway Management Board.

Construction is more or less finished, but a safety evaluation is needed before commercial operation begins. Again the experts who will do the evaluation, this time from French firm Apave-Certifer-Tricc, have not been able to enter Vietnam.

The 20-day test run has therefore been postponed since February, and the Chinese contractor has not set a new date.

The Cat Linh-Ha Dong Metro Section runs 13 kilometers from downtown Dong Da District to Yen Nghia in the southwestern Ha Dong District.

It is one of eight lines planned in Hanoi.

Construction began in October 2011 and was originally scheduled for completion in 2013. But several hurdles, including loan disbursement issues with China that were only resolved in December 2017, stalled it for years.

Its cost has doubled to VND18 trillion ($775 million), with 77 percent of it coming from official development assistance (ODA) loans from China.