The revised Law on Public Investment, which took effect on January 1, 2015, is expected to provide a comprehensive legal framework for restructuring the public investment process.

Minister of Planning and Investment Bui Quang Vinh said the law is a step further of the Prime Minister’s Direction 1792/CT-TTg toward optimising public investment via a synchronous legal framework for the management of the entire public investment process, including project approvals, capital source verification, and the implementation, supervision and evaluation of projects.

An important new point in the law is the stipulation on investment planning, which should be made on a five-year basis instead of annual plans in the past. The move is in accordance with the country’s five-year socio-economic development plans, which will facilitate the allocation of investment resources and help ministries and localities make suitable investment decision, he said.

The law is intended to maximise the efficiency of public investment, especially amid limited capital sources, and to facilitate transparent use of the State and local budget, Vinh noted, admitting that other overall measures are needed in conjunction to optimise public investment.

Le Hai Mo, Deputy Director of the Institute of Strategy and Policy on Finance, underlined the strict control of the State budget and proposed a fixed cap on the State budget deficit. He stressed the design and implementation of mid-term investments must be based on national interests, and conducted with the utmost discipline.

Meanwhile, Dr. Nguyen Quang Thai from the Vietnam Economic Association said the increased engagement of the public and the National Assembly in the approval and supervision of public investment is the most effective measure, as recommended by domestic and international experts.

Public investment restructuring is part of the economic restructuring strategy stated in the Vietnamese National Assembly’s Resolution No.10/2011/QH13 on the socio-economic development plan for 2011 to 2015. The strategy also covers the reform of State-owned enterprises and the banking system.-VNA