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HCM City to terminate contract with Chinese contractor   2010-05-26 - VietNamNet/SGT

HCMC authorities terminated a contract with China State Construction Engineering Corp. for an important package in the Nhieu Loc-Thi Nghe Sanitation project today, May 26, as the contractor has repeatedly failed to meet deadlines.

The city’s Department of Transport will hold a working session with the Chinese contractor on Wednesday to announce the termination due to the contractor’s poor performance, said an official of the department.

Phan Hoang Dieu, director of the management board for the Nhieu Loc-Thi Nghe Sanitation project, told the Daily that the termination would be made formal on Wednesday after the board had earlier informed the contractor of the decision.

In early March, the board issued an announcement to cancel the contract, but the formal termination has not been executed until now pending the completion of some construction components on the part of the contractor, Dieu said. The termination is made at the request of the World Bank, the key lender for the project.

China State Construction Engineering Corp., or CSCEC, was awarded Package No. 10 for several components, including dredging the Nhieu Loc-Thi Nghe Canal, removing a huge water pipeline, installing lighting equipment and others.

The contractor was bound to complete the package in August 2009, but it later asked for an extension of the deadline to the end of 2009, only to fail it again.

The remaining work in Package No. 10, according to Dieu, will be put up for tender again in case the World Bank rejects the appointment of new contractors, and it will take three to four months to choose new contractors.

That means another delay of the costly sanitation project.

This project’s timeline was first extended to the end of 2009 by the World Bank, but due to slow-moving construction on the part of contractors, the key lender approved another extension to June 2010 before approving the extension once more to September next year.

The World Bank has also banned CSCEC to join other projects funded by the global lender in other countries.

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