Vietnamese builders catching up with, surpassing foreign rivals

By Dinh Son – Le Quan, Thanh Nien News

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Ho Chi Minh City-based construction company Hoa Binh has taken over several stages of construction at Sunrise City, a luxury housing project in the city, from Korea's Kumho. Photo by Dinh Son

Vietnamese construction companies have improved their technical skills and make increasing use of their local knowledge to beat off foreign competitors in
bids for local projects.
Ho Chi Minh City-based real estate developer Hoa Binh has won a deal worth more than VND1.6 trillion (US$75.9 million) to build the foundation and basement for the highrise Saigon Center in the downtown area for Singaporean developer Keppel Land.
Hoa Binh had earlier taken over several stages of construction of the luxury apartment project Sunrise City from South Korea's Kumho Engineering & Construction.
It also beat many foreign companies to win a VND770-billion ($36.53 million) contract for building underground frames of VietinBank Tower in Hanoi.
Last year Cotec Construction JSC (Coteccons) outbid more than 10 foreign competitors to become the main contractor for the Ho Tram Strip luxury casino and resort complex in a deal worth VND3.2 trillion ($151.81 million).
The strip is being developed by Canadian group Asian Coast Development in Ba Ria-Vung Tau Province near HCMC.
Last June Cotec beat at least four Korean contractors to become the main builder of the SC Vivo City commercial complex in southern Ho Chi Minh City, a deal worth VND1.2 trillion. The complex will be similar to Singapore’s largest retail destination VivoCity.
Other local construction firms like Unicons in neighboring Binh Duong Province and state corporations Song Da and Vinaconex in Hanoi have also won major projects after bidding against foreign counterparts.
Le Viet Hai, chairman of Hoa Binh, said the competitiveness and prestige of local builders  are rising.
They are on a par with leading builders in the region and can confidently bid for overseas projects, he said.
Nguyen Ba Duong, general director of Coteccons, said Vietnamese contractors were previously outperformed by foreign competitors in technical aspects.
“But now we are equal. Under a fair bidding system, there is nothing we’re afraid of.”
Vietnamese contractors are likely to win if they make use of their “very huge” advantages as local operators, he said.
Foreign contractors can be more professional but they have to hire people and machines through at least two or three intermediaries, which makes it hard for them to control expenses, he said.
His company has hired 30 subcontractors from Japan, China, and Singapore for Ho Tram.
Dr Vu Gia Quynh, former general secretary of the Vietnam Construction Contractors Association, said many Vietnamese contractors opt to hire foreigners once they win a deal.
Though that is technically an ideal choice, it is a sign that Vietnamese firms do not trust each other, he said, calling it a weakness among local contractors.
“Since (most) Vietnamese contractors do not have deep pockets, they need to join hands with one another to be really able to compete.”

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