Highway cost soars above original estimate

The 54-km Cau Gie-Ninh Binh Highway ended up costing 2.5 times the original budget, auditors have found. — VNA/VNS Photo Huy Hung

The 54km road, with six lanes and designated speed of 100-120km/hr, opened in 2012 and is the first to connect Ha Noi with other provinces in the south.

In 2005, the Build-Operate-Transfer project was approved with a budget of VND3.73 trillion ($177.6 million). However, project investor Viet Nam Expressway Corporation (VEC) adjusted the budget and design twice, according to recently released data from the State Audit of Viet Nam (SAV).

Moreover, VEC did not conduct a hydrographic survey, instead using hydrographic statistics and calculations from similar projects, and the highway failed to meet technical requirements such as cement quality and road surface height.

The SAV said VEC, along with the project management board and its Cuban consultant Quality Couriers International, was responsible for these problems.

Director general of VEC Mai Tuan Anh told Tin Tuc (News) newspaper on Wednesday that the increased investment for the project was a result of changing the investment form. The project was first approved with funding from the State budget, but then the corporation issued bonds to mobilise capital.

The increased price of materials and labour, plus the bank interest rate, added additional financial burdens, he said.

"The increased project investment was mostly due to slow land clearance, complicated geographic conditions and more work required by localities such as flyovers and underground drains," Tuan Anh said.

He added that it was unfair to call the increased investment a loss because consultants made the approved estimate, while competitive bidding was open to select constructors and the value of bidding packages was identified through bidding.

The corporation would also invite independent consultants to re-examine the quality of the road and would take responsibility if mistakes were found, he said.