HCM City faces difficulties in relocating nearly 20,000 low quality homes

August 20, 2022 - 08:00
The city administration began the project in 2016 aim to improve the look of the area and bring better quality of life for local people, but a lack of funds has meant the process has been extremely slow.
Tẻ Canal in District 8, HCM City. —VNA/VNS Thanh Vũ

HCM CITY — HCM City is struggling to relocate nearly 20,000 slum homes situated on and along local canals.

The city administration began the project in 2016 with the aim to improve the look of the area and bring better quality of life for local people, but a lack of funds means the process has been extremely slow.

Data from the city’s Department of Construction showed that as of July 2022, the city had only relocated a total of 2,479 out of nearly 20,000 of the homes, equal to 12.4 per cent.

Only in District 8, there are more than 12,300 poor properties along the canals.

Trần Thanh Tùng, chairman of the district's People’s Committee told Thời Nay online newspaper that it needs at least VNĐ9 trillion (US$385.7 million) to relocate people living along the south bank of Đôi Canal and build an embankment.

The committee has coordinated with relevant agencies to call upon for investment from the private sector but failed, he said.

Huỳnh Thanh Khiết, deputy director of the construction department said the project’s implementation was slow although the city had ordered districts to actively carry out relocation work.

But it still faced problems in compensation and land clearance, he said.

Most of the low end homes have a very small area of land and are mainly built on the water. So, the relocation faces many difficulties in terms of paperwork, he said.

The main difficulty is that it requires a huge amount of capital, but the city budget is having to prioritise urgent infrastructure and social projects.

In the meantime, it is difficult to attract capital from the private sector because investors have not seen benefits when participating in the projects.

A house on Ông Lớn Canal in District 8, HCM City. — VNA/VNS Photo Thanh Vũ


The department’s Urban Development Office said from now to 2025, the city will focus on implementing three projects to solve the dual goals of improving the water drainage to combat floods and relocation to refurbish the urban areas.

The three projects consist of dredging, environmental improvement and infrastructure construction on Xuyên Tâm Canal, Văn Thánh Canal in districts of Bình Thạnh and Gò Vấp, and Hy Vọng Canal in Tân Bình District.

The estimated investment capital for the projects are VNĐ9.3 trillion ($398.4 million), VNĐ1.98 trillion ($84.8 million) and VNĐ1.2 trillion ($51.4 million) respectively.

The three projects are set to relocate a total of 3,220 poor houses. 

Nguyễn Chí Thiện, deputy head of the office said there are many large enterprises interested, but so far the projects failed to attract firm investment, he said.

To fix the situation, the department has advised the People's Committee of the city to call for investment for the projects, such as expanding the canals' corridor to create a commercially-exploitable land fund that is attractive.

Chairman of the HCM City Real Estate Association (HoREA) Lê Hoàng Châu said the most important thing in implementing projects is land clearance.

Therefore, the association suggested the city administration to separate the work of land clearance and compensation into an independent project, he said.

After the land fund is available, the city could open a bidding to select investors, he said.

In a related move, the committee has already submitted to the Government’s Office and the Ministry of Construction several solutions to mobilise non-budget capital for the projects, said Trần Hoàng Quân, director of the department said.

The city proposed to use public-investment capital for land clearance, building embankments to create land fund to attract enterprises to invest in the projects; resettlement for people living in the areas along the canals with available housing funds, he added.

Chairman of the municipal People's Committee Phan Văn Mãi said that the city is determined to implement the programme.

The city is calculating and adjusting the planning to exploit the riverside land fund and make auction to gain funding, he said.

The city strives to relocate a half of the total 20,000 poor quality home along and on canals by 2025, he said. — VNS