Hanoi (VNA) – As official development assistance (ODA) is no longer concessional financing but increasingly structured as loans at commercial interest rates based on negotiations and agreements, Deputy Prime Minister Nguyen Van Thang stressed the need for a change in approach towards this source of capital and called for special attention to speeding up disbursement of ODA-funded projects.
Thang made the request while chairing a meeting with ministries and sectors in Hanoi on June 17 to review public investment disbursement and address bottlenecks affecting ODA projects.
According to the Ministry of Finance, in the first six months of the year, proposals for new ODA loans worth nearly 1.7 billion USD were approved, while procedures were completed for the signing of three foreign loan agreements valued at nearly 586 million USD.
However, as of June 15, the disbursement rate for public investment funded by external sources had reached only 9.99% of the assigned plan. Although the figure was higher than in the same period last year, it remained well below the national average. Notably, one out of eight ministries and central agencies and 13 localities had yet to disburse any allocated capital.
Opinions presented by the ministry and other agencies attributed the slow progress mainly to unresolved site clearance, delays in tendering and contract signing, prolonged project preparation and implementation, inconsistencies between domestic procedures and donor requirements, and investment plans in some localities that did not reflect actual implementation conditions.
Concluding the meeting, Thang underlined that achieving ambitious growth targets would require stronger performance from traditional growth drivers, namely investment, exports and consumption. Within investment, ODA and concessional foreign loans remain an important source of financing.
For projects already under implementation, he instructed governing bodies and project owners to prioritise completing land clearance to enable construction works to proceed, adding that heads of agencies would bear full responsibility before the Government and the Prime Minister for implementation progress.
For new projects, he proposed that land clearance should either be carried out in parallel with or ahead of loan negotiations and agreement signing, so that construction could commence immediately once the loan became effective. He also suggested considering separating land clearance components from projects financed by foreign loans where appropriate.
The Deputy PM tasked the Ministry of Finance with prioritising ODA resources for major projects, large-scale loans and budget support operations.
He also requested the Ministry of Finance to propose revisions to regulations governing medium-term and annual capital planning to remove obstacles affecting public investment projects financed through foreign capital.
Meanwhile, the Ministry of Foreign Affairs was instructed to provide the Ministry of Finance with detailed information on challenges faced by foreign donors in ODA and concessional loan projects before June 20, and coordinate efforts to resolve outstanding issues.
Ministries, ministerial-level agencies and local authorities, meanwhile, were requested to implement synchronised measures in line with the PM’s directions on monetary and fiscal policy management for 2026 and the review and adjustment of public investment plans, while reporting matters beyond their authority directly to the Government leader./.
