Logo of Phnom Penh Post newspaper Phnom Penh Post - Vietnam train services may be derailed by funding chaos



Vietnam train services may be derailed by funding chaos

Content image - Phnom Penh Post
A railway worker in Thuan Bac District, south-central Ninh Thuan Province. VNA/VNS Photo/ANN

Vietnam train services may be derailed by funding chaos

Vietnam could cease to have an operating train system in less than two weeks unless a funding issue at Vietnam Railways (VNR) is resolved, an official has said.

The stunning revelation came on Thursday when Vu Anh Minh, chairman of VNR’s member council, spoke at a meeting between the government’s working group and the Commission for Management of State Capital at Enterprises.

The railway operator hasn’t received a single dong from the state since November 2018, when a change in how it was managed stopped the flow of cash, leaving the corporation without a budget for vital railway maintenance.

The VNR used to be under the management of the transport ministry but in November 2018, it was transferred to the Commission for the Management of State Capital at Enterprises, as part of efforts to separate state capital management from corporate administration.

Before the transfer, annual budget estimates allocated to the VNR for maintenance work were made by the transport ministry, which can no longer allocate funding as it does not manage the VNR.

However, the Commission for Management of State Capital at Enterprises is also unable to approve the budget for the VNR as the railway law only allows it to monitor the use of the state budget for production and business purposes, not for asset management under which maintenance work for railways is categorised.

The funding shortfall has left more than 11,000 railway workers unpaid since the beginning of this year. If the problem is still unresolved by early next month, the corporation will have to halt train operation, Minh said.

He said to make up for the budget shortage, maintenance companies under the VNR had advanced about 200 billion dong ($8.7 million) to continue the work but these sources are limited.

Despite the financial struggles, the VNR still ordered maintenance companies to continue working to ensure trains run safely, VNR director-general Dang Sy Manh told Vietnam News Agency.

The VNR had reported its problems to the commission, the government and National Assembly Standing Committee to seek solutions, said Manh.

The transport ministry has proposed taking back the VNR under its control to clear the confusion.

Prime Minister Nguyen Xuan Phuc asked the ministry and the Commission for Management of State Capital at Enterprises to assess the proposal and report to the government early next month.

Deputy Minister of Transport Nguyen Ngoc Dong said the ministry had assigned consultant agencies to assess the pros and cons of re-transferring the VNR to the transport ministry.

The VNR operates more than 1,500 crossroads with railway lines and on more than 3,000km of railway lines crossing 34 provinces and cities across the country. More than 7.6 million people used trains in the first 11 months of last year.

VIET NAM NEWS/ASIA NEWS NETWORK

MOST VIEWED

  • Hun Sen: Full country reopening to be decided in two weeks

    Prime Minister Hun Sen has announced that if the Covid-19 situation remains stable for 15 consecutive days from the end of the October 5-7 Pchum Ben public holiday, Cambodia will reopen fully, albeit in the context of Covid-19 whereby people have to adjust their lives to

  • Phnom Penh governor: Show Covid-19 vaccination cards, or else

    Phnom Penh municipal governor Khuong Sreng late on October 5 issued a directive requiring all people aged 18 and over and the parents of children aged 6-17 to produce Covid-19 vaccination cards when entering schools, markets, malls, marts, eateries and other business establishments that have been permitted

  • Cambodia seeks probe into 'false reports' on Hun Sen's alleged Cypriot passport

    Minister of Justice Koeut Rith on September 6 wrote a letter to his Cypriot counterpart Stephie Dracos requesting cooperation in investigating and providing the truth in relation to the "exaggerative and false allegations" that Prime Minister Hun Sen holds a Cypriot passport. In his letter, the

  • Will Evergrande change the way Chinese developers do business in Cambodia?

    China’s property sector policy has exposed the grim financial condition of real estate developers including those operating in Cambodia, which raises questions over the viability of their projects and business going forward The dark blue netting draping over one of Yuetai Group Co Ltd’

  • 'Pandora Papers' expose leaders' offshore millions

    More than a dozen heads of state and government, from Jordan to Azerbaijan, Kenya and the Czech Republic, have used offshore tax havens to hide assets worth hundreds of millions of dollars, according to a far-reaching new investigation by the International Consortium of Investigative Journalists (

  • Cambodia voted ‘world’s friendliest country’ in Rough Guides reader poll

    Cambodia ranked number one among the “World’s Friendliest Countries”, according to a reader poll conducted by London-based international website “Rough Guides”. Taking submissions through Twitter and Facebook, “Rough Guides”, a well-known travel agency and publisher of guidebooks, said the Kingdom “was by far the