Effective use of ODA requires better management
*Many NA deputies voiced their
concerns over the losses and wastefulness in managing and using ODA. As
permanent member of the NA Committee for Financial and Budgetary
Affairs, what do you think about this?
I see that ODA sources
have made great contributions to national socio-economic development.
However, inspections showed that there are ineffective ODA projects
which are not in urgent need of investment. In addition, many ODA
projects adopt regulations on foreign contractors or the mandatory use
of materials and fuel of ODA donor countries which increase project
expenditures and reduce the effective use of ODA.
The NA
Committee for Financial and Budgetary Affairs has exercised supervision
and made reports on public debt issues including problems and
recommendations. But, it needs supervision at a higher level from the NA
Standing Committee or the NA to turn out a more comprehensive review of
the issue. With such large-scale supervision in co-ordination with
Government support and a clearer overview of the public debt situation,
hindrances and solutions will be mapped out.
*What are the difficulties in monitoring ODA capital? Is there any 'restricted area'?
We
have no 'restricted area' in managing investment capital, public
finance and debts. Even security issues still undergo audit and
inspection under the security mechanisms.
It is difficult for the
NA to supervise objectives using ODA sources as they are spread out
over ministries, departments and localities. In addition, the NA
Committee for Financial and Budgetary Affairs faces challenges in
monitoring individual ODA project as the Committee mainly conducts
overall supervision. Thus, it is necessary to use other State tools such
as State Audit to assist the NA in dealing with this issue.
*It
was suggested that Vietnam should 'graduate' from ODA. Do you think this
is appropriate while the budget is limited and the country needs
investment capital for development?
Vietnam has an enormous
demand for capital to invest in the economy and to achieve its goals set
out for industrialisation and modernisation. Foreign capital sources
are of great importance as domestic sources cannot help fulfil the
targets.
Moreover, borrowing ODA loans has more advantages than
mobilising from internal sources. In recent years, along with budget
overspending, capital mobilised for Government bonds and rollover loans,
Vietnam has to borrow an additional 400 trillion VND (18.8 billion
USD). But the interest rates of commercial loans are higher than ODA
loans and repayment pressure is very high.
*How can Vietnam effectively manage and use ODA sources?
As
I've mentioned above, we only grant ODA to necessary and urgent
projects. In addition, ODA projects should follow a series of
regulations. For instance, the cost per unit of an ODA project must be
lower than that of a corresponding project using domestic sources. I
suggest stopping ODA projects with a high cost per unit during the
investment appraisal.-VNA