Prime Minister Nguyen Tan Dung will work with responsible ministries to clarify issues relating to the North-South express rail project before the National Assembly votes on it later this month.

Prime Minister Nguyen Tan Dung will work with responsible ministries on June 2 to clarify issues relating to the North-South express rail project before the National Assembly votes on the $56 billion scheme later this month, according to the head of the Prime Minister’s Office, Nguyen Xuan Phuc.

Controversies over North-South express railway project

Speaking at the monthly press conference on June 1, Minister Phuc said that when it assessed the the high-speed rail project, the Government concluded that it will be effective and Vietnam can find the capital needed for it.

Phuc emphasized that the technology embodied in the project will serve the nation for long into the future. Vietnam will learn from the experience of developed countries.

The capital requirement bruited for the express rail project – US$56 billion – is an estimated number, Minister Phuc said. If the National Assembly approves the project, the government will proceed to detailed planning, and refine the financial projections.

Phuc confirmed that the Japanese Government has committed to assist Vietnam with capital and technology if the project is approved.

Phuc insisted that the implementation of the 1570 kilometer rail project will not degrade Vietnam’s ability to manage public debt. National GDP is expected to reach $200 billion by 2020, he pointed out. The nation’s indebtedness is less than 50 percent of current GDP. Vietnam’s public debt is safe and under control, Phuc said. “We won’t become insolvent either in the short or the long term.”

Reporters also raised questions about widespread power cuts. Deputy Minister of Industry and Trade Nguyen Thanh Bien blamed the shortfalls on low water in reservoirs owing to drought, which reduced hydropower production at the same time that hot weather increased demand for poser. The demand for electricity in May was 23 percent higher than in May 2009, Bien said. His ministry had sent three directives to Electricity of Vietnam and to provincial Departments of Industry and Trade instructing them to economise power consumption.

Bien blamed power cuts lasting up to 23 hours in parts of HCM City on “technical incidents.” The Industry Ministry is making every effort to forestall a recurrence, Bien said.

The Government also released economic statistics for May. The consumer price index (CPI) was up a modest 0.27 percent, export revenue increased by 12.6 percent year on year and the trade deficit shrank. Of particular concern to the Government at present are higher than wanted interest rates, distortions in the real estate market, and the power outages’ negative impact on production.

PV