Metro Line 1 is being demanded by Japanese contractors for more than 324 million USD in incurred costs

MINH QUÂN |

Ho Chi Minh City - Metro No. 1 (Ben Thanh - Suoi Tien) is facing many complaints from Japanese contractors with a total arising value of more than 324 million USD (more than 8,474 billion VND).

The above information is stated in the document of the Ho Chi Minh City People's Committee sent to the Ministry of Finance.

Metro Line 1 was approved in 2007, started construction in 2012, nearly 20 km long, connecting the center of Ho Chi Minh City with the eastern gateway.

The metro line has 11 elevated stations and 3 underground stations, with a total investment of more than 43,700 billion VND, mainly using ODA capital from Japan.

Metro số 1 đã phục vụ hơn 26 triệu lượt khách.  Ảnh: Minh Tâm
Ho Chi Minh City Metro Line 1 has served more than 26 million passengers. Photo: Minh Tam

Metro Line No. 1 officially opened from December 22, 2024, and has served more than 26 million passengers with more than 100,000 train trips to date.

However, the 4 main construction packages of Metro Line 1 are currently facing complaints, in which the construction time is nearly 12 years long, leading to many problems.

Package CP1a: Ben Thanh underground section - City Opera House (SMCC - CIENCO4 Joint Venture)

The contractor has goodwill to cooperate, wishing to resolve arising costs soon to complete the contract. Outstanding contents include financial costs due to late payment, adjustment of the price of the Vietnamese bronze part, extension of implementation time due to temporary suspension of construction at the F2 entrance and ventilation tower, volume exceeding BOQ, and additional work on fire prevention and fighting.

The investor, the Ho Chi Minh City Urban Railway Management Authority (MAUR), is appraising the estimation dossier and completing the contract appendix to serve as a basis for payment.

Currently, the two parties have not agreed on the adjusted value according to the price index due to differences in source of application. Ho Chi Minh City People's Committee directs the Investor to closely coordinate with the contractor, urgently handle problems, and complete before March 27, 2026.

Package CP1b: Underground section of City Theater - Ba Son (Joint venture Shimizu - Maeda)

The contractor has agreed to carry out commercial mediation at the Vietnam International Trade Mediation Center. Joint consultant NJPT assessed the value of the complaint at about 15 million USD.

The Ho Chi Minh City People's Committee assigned the Investor to coordinate with legal consultants and NJPT to thoroughly review reasonable arising expenses, summarize the expected payment value, and ensure that it does not exceed the approved total investment level.

The Department of Construction will take the lead in reviewing and completing the overall mediation plan before March 20, 2026, so that the Investor can sign contract appendices and complete complaints before March 27, 2026.

Package CP2: Elevated section and depot (Joint venture Sumitomo - CIENCO6)

The SCC contractor proposed to resolve the overall complaints with an initial value of about 100 million USD, committing to withdraw the lawsuits at the Vietnam International Arbitration Center if mediation is successful.

In the process of continuing to work, SCC proposed about 45 million USD, with the condition that the parties complete it before March 31, 2026; if no agreement is reached, the contractor will return to the required level of about 62.6 million USD.

NJPT consultants estimate the value of reconciliation that can be considered is about 40 million USD.

Ho Chi Minh City People's Committee directs the Investor to continue to coordinate with consultants to agree on the value of mediation and prepare for arbitration trials if necessary. The next hearing is scheduled from May 6 to 12. 2026.

Package CP3: Electromechanical equipment, locomotives and carriages, railways and maintenance (Hitachi)

This bidding package generated 121 complaints with a total converted value of about 332 million USD. The contractor prioritizes resolving through arbitration but has not provided a basis for determining the value of mediation.

On January 30, 2026, Hitachi proposed a total settlement of about $264.2 million (equivalent to 40.3 billion Japanese Yen), a 20% reduction compared to the total complaints. However, this proposed level is mainly based on the total value of complaints being resolved at arbitration, not fully reflecting the objective assessment of legal risks and contract obligations of the parties.

In addition to financial issues, some important technical backlogs have not been completely resolved by the contractor, including replacing equipment that does not meet contract standards, overcoming train wheel slippage in operating conditions, and handling issues related to system safety.

Ho Chi Minh City People's Committee directs the Investor to coordinate with NJPT General Consultant and Legal Consultant to promote mediation, and at the same time prepare complete dossiers and documents for arbitration proceedings if necessary.

MINH QUÂN
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