In the wake of budget cuts, Saigon’s municipal government is projecting a required investment of US$7.6 billion to implement the city’s planned infrastructure projects by 2020.
According to Saigon Giai Phong, Deputy Chairman Le Van Khoa of the Ho Chi Minh City People’s Committee says the southern hub has already sped up some of its infrastructure projects in an effort to connect the city with surrounding provinces and boost investment potential.
These projects include the HCMC-Long Thanh-Dau Giay and Ben Luc-Long An Expressways to the east and south of the city. Next year, municipal officials also plan to begin work on an outer belt road around Saigon, while HCMC Metro Line 1 is expected to reach completion by 2020.
The city also plans to make some changes to its urban planning through the relocation of 20,000 canal-side households and the renovation of at least half of the city’s 474 pre-1975 apartment buildings.
Moving forward, city officials predict roughly US$2 billion of the required capital for such projects will come through public-private partnerships (PPPs), while the remainder will come from a combination of official development assistance (ODA), commercial loans and the state budget. Municipal authorities also plan to hone in on reforms in land management as well as planning and construction in the city.
These figures come in the wake of recent cuts to the city budget. Late last month, Vietnam's central government unexpectedly asked for a higher share of Saigon’s income, prompting HCMC Deputy Party Chief Nguyen Thi Quyet Tam to tell the National Assembly: “Such an abrupt budget cut would leave [Ho Chi Minh City’s] economy with no time to react. The Government and National Assembly needs to reconsider [this proposal],” reports Tuoi Tre.
The proposed 5% budget cut was recently approved, according to VnExpress. Starting in 2017, Vietnam’s central government will take 82% of Saigon's income, leaving the southern hub with the remaining 18% to support its municipal government. As the country’s biggest moneymaker, Saigon brought in a total of almost US$12 billion last year.
As a result, Saigon’s municipal government is expected to face challenges in the coming years. Municipal Department of Transport Director Bui Xuan Cuong told Tuoi Tre the city’s current budget – 23% of its income – only meets 30% of the southern hub’s infrastructure budget requirements.
