The main water supply company in Da Nang, Dawaco, has proposed that it raises funds on its own to build the Hoa Lien Water Plant instead of using non-refundable ODA funds from Japan.

The Tien Sa Port in Da Nang is the 1st project not to use ODA funds for the 2nd stage of its upgrade. — VNS Photo Cong Thanh

The proposal was made by the company’s General Director, Mr Ho Huong, in a recent meeting with the city leaders this month.

Mr Huong remarked that the company’s water plants with a total capacity of 210,000m³ each day have been overworked in summer when it exceeded designed capacity to supply 260,000m³ a day.

He said the company will have to supply 660,000m³ each day in 2025, and needs an early start to be able to do that.

Using ODA funds would mean that the Hoa Lien Water Supply Plant can only begin operations by 2022, given the complicated procedures, management and operations associated with such funding.

“We can raise funds ourselves for the 1^st stage of the Hoa Lien Water Plant in the 4^th quarter of 2017 and begin operations in late 2019, providing an additional 120,000m³ of clean water each day,” Hương said.

“The water plant will use 4.8 trillion VND (US$212.3 million) for a 20-year construction and operation period, but we can reduce investment capital by building the plant faster,” he said.

While the ODA funding would be for a PPP (public-private partnership) project, Dawaco can raise funds from shareholders because it is a joint-stock company.

Municipal People’s Committee Chairman Huynh Duc Tho said that the city will consider Dawaco’s proposal soon.

Chairman Tho asked the company to prepare a fundraising plan with a strict construction schedule. The city will decide the best way of investing later, he said.

This is the 2^nd project in the city that the investor has spurned ODA funds. The Da Nang Port Company raised funds from shareholders instead of using ODA from Japan.

The local authorities have said that the city is set to face a water crisis in the coming years as water exploitation has equaled existing designed capacity with 200,000m³ taken from the Vu Gia River.

Meanwhile, the Cau Do Water Station, the city’s major supplier, is struggling often with highly saline water due to a lack of supply from the upstream rivers during the dry season.

The city had called for Public-Private-Partnership (PPP) investment projects in waste water treatment and clean water supply and it seeks to become a ‘green’ city.

It has estimated project costs at 6 trillion VND ($267 million), of which $218 million would be used for urban infrastructure, to reach the ‘green’ target (an environmentally friendly city) by 2025.

In 2015, the city listed 19 projects calling for investments of 16.5 trillion VND ($768 million) under the PPP model.

The same year, it presented a $115-million budget proposal for upgrading waste water treatment stations, waste water drainage systems and drainage channels in the city. The World Bank had agreed to loan $100 million for this project.

(Source: VNS/ DA NANG Today)