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Local authorities have allowed Dai Quang Minh Real Estate Investment Corporation to continue its work on four key roads with a combined length of 12 kilometers, connecting the site’s functional areas, and on a central square and riverside park, all under the BT format.
The BT model is used for the construction of infrastructure facilities where the investor later transfers the facility to the State and is given land use rights for other projects in exchange, allowing the investor to recover their investment.
The city government intends to hold an auction for investors to develop a vast wetland ecological region in the south of Thu Thiem Peninsula, bordering the Saigon River.
The resumption of construction work is also applicable to projects to develop technical infrastructure for the area’s northern residential zone, complete a North-South route, build four bridges, dredge canals and dig a lake in the central area and build new canals.
The State Audit Office of Vietnam is expected to scrutinize transport infrastructure projects within the premises of the new urban area this year, following the inspection findings of the Government Inspectorate.
The Government watchdog announced in June 2019 that the investors in these BT projects had earned large profits owing to the wide gap between the land price approved by the HCMC government and the market price.
The municipal government selected Dai Quang Minh Corporation as the sole investor for a project to build the four major roads without asking the firm to provide evidence of its experience and financial capacity.
The city approved an investment of some VND12.2 trillion for the four roads without consulting with the relevant departments and agencies. Investments for some items were not made in line with laws, causing losses of more than VND1.5 trillion for the State budget, according to the Government Inspectorate.
In the land clearance process, the city amassed 221.68 hectares of cleared land in Thu Thiem but later used it as a means of payment for investors involved in BT projects to build infrastructure for the area.
This land should have been put up for auction in alignment with prevailing regulations. Using the land as a direct means of payment for BT road builders constituted an infringement of the rules on land bidding, use and management, according to the inspectors.