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Fund shortage hinders new coach stations

A lack of funds and problems related to traffic infrastructure are hindering the HCM City government’s plan to build two new coach stations in suburban areas.

Under the VND3.6 trillion (US$1.8 million) scheme by the city People’s Committee, Suoi Tien and Tan Quy Tay coach stations would have been commissioned by 2015 to replace the two existing Mien Dong and Mien Tay stations.

Construction of the two new coach stations, to be invested by the Sai Gon Transportation Mechanical Corporation (SAMCO), is also aimed to create a link with the bus system, and the metro and tram routes.

Suoi Tien Coach Station, to cover 12ha of District 9 and nearly 4ha of Binh Duong Province, is designed to connect with the metro route No.1 stretching from Ben Thanh Market to Suoi Tien Recreational Park.

The 14.8ha Tan Quy Tay Coach Station is designed to link with the tramline No.1 from downtown city to Cho Lon and Mien Tay coach stations.

The two new stations, about three to four times the size of the old ones, will be built to modern standards and will include shopping, sightseeing, and recreational facilities to serve passengers.

But SAMCO said the two projects are short of funds to clear the ground and their connectivity with a metro route upon completion is in doubt.

SAMCO deputy general director, Le Van Pha, said costs have amounted to VND1.6 trillion ($800,000) to clear the site for the two new stations.

Although SAMCO had planned to take out bank loans, banks refused to lend the capital for ground clearance.

City administration earlier issued a decision to provide an annual support of 8 per cent to the interest rate of bank loans to develop primary components of the projects.

But the investor balked at the proceeding with the projects, given the rate has now jumped to 18 to 20 per cent from 12 to 14 per cent, when the decision was issued.

Municipal authorities and the investor are also concerned about whether or not the two new coach stations can connect with the metro route No.1 and the tram line.

Otherwise, the projects will yield little socio-economic benefits, and can even be wasteful, they said.

Currently, only the depot of the metro route No.1 was already built in District 9 while construction of other components has been delayed due to ground clearance.

The route is scheduled for completion by 2016.

With capital investment continually climbing, the city has temporarily halted construction of the first tram line.

An alternative proposal by the Department of Transport to launch an express bus route is under consideration.

Intervention

To unravel existing setbacks, the city People’s Committee has recently agreed to exempt land-use fee from the area where the two new coach stations will be located.

The city will also spend money from its budget to develop connecting traffi infrastructure, such as tunnels, overpasses, and pedestrian bridges as soon as the two projects are finished.

Four planned

A city plan envisages building four new coach stations by 2015, covering a total 79ha or three times as large as the current ones.

Apart from Suoi Tien and Tan Quy Tay stations, ground will be broken for the 24-ha Xuyen A Coach Station in Hoc Mon District to serve passengers travelling to Cambodia and Tay Ninh Province.

Construction will also start for the 19-ha Long Truong-Song Tac station in District 9 to serve passengers going to the central region, southern Ba Ria-Vung Tau province and Lam Dong Province in the Central Highlands.

The city will exempt the investor from compensating for cleared public land to reduce investment costs, and allow the investor to use already-cleared land to recoup investment capital early.

Pha said the solutions offered by city authorities had partly helped the investor solve problems and hasten implementation of the projects.

But the big problem are the funds needed to compensate for ground clearance, adding that SAMCO is awaiting the financial assistance plan from the city government.

He suggested that the city consider providing interest-free loans worth VND1.12 trillion ($560,000) for 14-15 years for ground-clearance compensation of the main operational complex.

SAMCO will call for social participation in the construction of other components and enjoy the annual 8 per cent interest subsidy from the city, Pha said.

Reducing pollution

The HCM City Department of Transport will carry out a pilot programme to encourage local residents to use public transport or non-motorised vehicles in an aim to reduce traffic accidents and environmental pollution.

Duong Hong Thanh, deputy director of the department, said that the programme, expected to start in the beginning of May, would encourage state employees, students and workers to use buses or non-motorised vehicles at least one day per week.

From September, the programme would expand to the entire city, Thanh said.

Every day, nearly 2,900 buses carry nearly 1.5 million passengers on more than 147 routes, according to Le Trung Tinh, head of the department’s Transportation Management Office.

The buses operate at only half of their capacity and can serve an additional 2 million passengers a day.

The bus system covers most of the city’s routes from central to outlying areas, making it easy for commuters to reach any destination by transferring from one bus to another.

An estimated 4.947 million vehicles, including 447,000 automobiles and 4.5 million motorbikes, are registered in the city, according to the department’s figures.

At least one litre of petrol at a cost of VND21,300 (US$1.03) could be saved per day if a motorbike driver shifted to bus travel. This is equal to a total of VND21.3 billion (US$1.03 million) in fuel costs for a total of one million motorbikes a day.

With city subsidies to bus companies, bus fares have remained stable at VND4,000-5,000 per ticket despite recent fuel hikes.

The city subsidises the costs to encourage the usage of public transport among city residents, particularly students and low-income earners.

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