French, Malaysian firms withdraw from 154 mln dollar Vietnam water project
HANOI - France's Suez Lyonnaise des Eaux and Malaysia's Pilecon Engineering have withdrawn from a 154 million dollar water treatment plant project in Ho Chi Minh City, a Vietnamese official said Monday.
Tran Dinh Phu, deputy director of the municipal Department of Communications and Public Works (DoCPW), told AFP the two companies were waiting for official approval to withdraw from the project but he did not give any details.
The two companies were not immediately available to confirm the news.
But a foreign expert confirmed the French company had decided to withdraw.
"They decided to do it discretely. The decision did not come from a problem with the Vietnamese side. It is a worldwide strategy of the group," he said.
The French and Malaysian firms joined to form Lyonnaise Vietnam Water (LVWC), the first 100 percent foreign-invested water project licensed in the country, to build and operate the plant for a set period before transferring it to Vietnamese ownership.
The contract was signed in 1997 to build a seven hectare water treatment plant designed to process 300,000 cubic meters of water a day from the Dong Nai river.
The Vietnamese authorities are now expected to find a new partner.
"I believe the Vietnamese authorities want to find a local partner", the expert added.
The project was aimed at reducing water shortages in the southern economic hub of Ho Chi Minh City.
The city needs 1.2 million cubic meters of water a day, but it only produces 900,000 cubic meters and 38 percent of that is lost during distribution, the Water supply company (WSC) was quoted as saying in Vietnam Investment Review.
Agence France Presse - April 14, 2003.
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