Saigon eliminates Metro Line #1 costs by $147 million USD

The Ho Chi Minh City People’s Committee announced last week that the city’s Metro Line #1 is considered 75% complete and that they have approved a cost adjustment for this line that will see costs reduced by $147 million USD. At the same time, authorities said that as of this date the costs for the second metro line would remain the same.

Vo Van Hoan, Deputy Chairman of the People’s Committee, said that the government had examined all categories and budgets for Metro Line #1 and were able to remove some items that were considered unnecessary elements and that the removal of these items had reduced project costs.

Hoan said, “The total investment capital has been reduced, but this does not affect the quality of the (construction) packages. The project is 75% complete, so all major variables are basically identified and there is very little chance of costs ballooning,”

He added that an urban railway company for the first line has also been established and the city is conducting staff recruitment and training. The city is also planning for the arrival of the trains that will be used on Metro Line #1, which are expected to arrive in 2020.

While cost reductions for any infrastructure project are always welcome news, the reality is that the original costs for Metro Line #1 were projected at $750 million USD, and are now projected at $1.88 billion USD, even with the cost reductions that were announced.