The project "Solving flooding caused by tides in Ho Chi Minh City area taking into account climate change factors (phase 1)" started in 2016 under the BT (build - transfer) form, with a total investment of nearly 10,000 billion VND.
The project aims to control flooding caused by high tides on an area of 570 km2, protecting about 6.5 million people in the right bank of the Saigon River and the center of Ho Chi Minh City.
Although more than 90% has been completed, due to legal problems and payment procedures for investors, the project has been suspended since November 2020.
According to the project working group, during the implementation process, many changes in investment regulations in the form of BT have caused many different opinions on determining payment options for investors.
One side believes that only 3 out of 7 plots of land stated in the contract should be paid in cash, the rest should be paid in cash.
Another option is to propose full payment in land funds according to the principle of price equality, only when there is a difference between land value and project value at the time of settlement, the difference will be paid in cash.
This difference is the core reason why the project is being delayed and has not been completely resolved for many years.
According to Clause 5, Article 101 of the PPP Law, projects signed before the law takes effect must be implemented and paid according to the BT contract and legal regulations at the time of signing.
In fact, Ho Chi Minh City has signed a BT contract contract and appendix with the investor, stipulating payment by land fund equivalent to 16% of the project settlement value (about VND 1,588 billion, including 7 land plots). The remaining amount, equivalent to 84% of the value (about VND 8,380 billion), is expected to be paid in cash.
However, this option was determined to be inconsistent with current regulations and must be adjusted according to Resolution 40/NQ-CP (dated April 1, 2021).
By July 2025, the Government issued Resolution 212/NQ-CP, allowing Ho Chi Minh City to pay investors with land funds, if the land value is less than the value of the BT project (reviewed, unreasonable costs are eliminated...), the difference will be paid in cash from public investment capital of Ho Chi Minh City.
According to the new regulations, the value of the land fund paid must be equivalent to the total investment of the project, the difference must not exceed 10%.
Thus, the option of only paying in 3/7 plots of land, the rest in cash is no longer suitable. If this is applied, it will cause legal risks and at the same time, there is a potential risk of lawsuits due to unilateral contract adjustment.
The project working group to prevent floods affirmed that payment by land fund according to the principle of price action is the most feasible solution, both ensuring compliance with regulations and helping the project to re-construct soon.
Therefore, the working group proposed 5 land plots to negotiate and sign contract appendices with investors, including:
The land at 257 Tran Hung Dao, with an area of 2,374 m2, has an appraised value of more than VND597 billion.
The land plot of 420 No Trang Long, with an area of over 66,800 m2, is worth about 5,385 billion VND.
Lot C8A - Area A, New Urban Area of South Ho Chi Minh City (Tan My Ward), area of 5,500 m2, worth more than 1,113 billion VND.
The land at 232 Do Xuan Hop (Phuoc Long ward), with an area of over 14,000 m2, is worth over VND930 billion.
The land plot at 762 Binh Quoi (Binh Quoi ward), with an area of over 3,100 m2, is worth about 72.3 billion VND.
The total value of the 5 plots of land reached more than VND 8,099 billion, equivalent to 81.1% of the BT contract value of the project (about VND 10,000 billion, excluding the adjustment of the total investment).
Trung Nam Construction Investment Joint Stock Company (Trung Nam Group) - the project investor, recently sent a document to the Ho Chi Minh City People's Committee stating its agreement with the above proposal for payment by land fund.
The enterprise affirmed that adding land funds is a prerequisite for the project to be resumed and completed on schedule.
Trung Nam Group also emphasized that the prolonged problems are not the responsibility of the investor and if not resolved soon, it will cause great waste when the project has completed more than 90% of the volume, while the interest cost arises up to 1.7 billion VND per day.
Recently, Ho Chi Minh City Party Secretary Tran Luu Quang chaired a meeting with departments and branches to resolve the remaining problems of the project. The city aims to complete the project in 2026.
