Public investment disbursement remains slow: Deputy Minister

Hanoi (VNA) – The disbursement of public investment in the first seven months of 2021 reached 36 percent, 4 percent lower than the figure in the same period last year, according to Deputy Minister of Planning and Investment Tran Quoc Phuong.

In a recent interview granted to the Vietnam News Agency’s reporter, Phuong mentioned difficulties facing sectors and localities in implementing public investment projects, and proposed measures to speed up the disbursement of public investment in the coming time.

He attributed the slow disbursement to COVID-19 outbreaks in many provinces and cities, and the suspension of projects in areas applying social distancing measures in line with the Prime Minister’s Directive No.16/CT-TTg.

Other causes are related to site clearance, and changes in planning in several localities.

Difficulties amid COVID-19 pandemic

In 2020, the supporting role played by public investment for the country’s economic growth has been confirmed with impressive results, significantly contributing to the annual growth.

This year, public investment has continued to play a supporting role in promoting economic growth in the context that production, business and service sectors have been being greatly affected by the COVID-19 pandemic.

According to the deputy minister, public investment projects also depend on issues such as transportation of materials and equipment for construction, and the shortage of workers, experts and consultants because of social distancing regulations in many localities in line with Directive 16 of the Prime Minister, so it has been difficult to implement construction works, especially in pandemic-affected areas.

Additionally, the increasing prices of construction materials have negatively affected the progress of public investment projects, causing difficulties for contractors in finding material supplies.

Deputy Minister Phuong said public investment in 2021 mainly focuses on making preparations for plans in the next five years. Most of new projects in the 2021-2025 period have not been implemented yet because they have to wait for the National Assembly’s approval for a medium-term plan in the 2021-2025 period.

Efforts to complete 60 percent of public investment disbursement plan in Q3

The Ministry of Planning and Investment said that the disbursement rate of public investment was expected to be at least 60 percent of the plan by the end of the third quarter and 95-100 percent for the full year.

The latest updates of the General Statistics Office (GSO) showed that more than 295 trillion VND worth of investment from the State sector was disbursed in the first half of this year, accounting for 25.3 percent of the plan and up by 7.3 percent against the same period last year.

The total realised investment in the economy, including the public investment, non-State sector and foreign direct investment (FDI) was estimated at 1.169 quadrillion VND, up by 7.2 percent against the same period last year.

The ministry has submitted to the Prime Minister for assignment of a medium-term plan in accordance with the Resolution No. 29/2021/QH15 of the National Assembly on a medium-term public investment plan for the 2021- 2025 period, with many projects are expected to start construction and bidding in the coming time.

Regarding procedures to adjust existing projects, the ministry has submitted a new draft of Decree No. 56/2020/ND-CP on the management and use of ODA and concessional loans of foreign donors to the government, including many administrative procedures for ODA projects, which are hoped to have impacts on projects in the remaining months of this year and early 2022.

However, breakthrough solutions to promote the disbursement of public investment mostly depend on the direction and management of ministries, sectors and local authorities, especially in the context of COVID-19 pandemic.

Deputy Minister Phuong emphasized the need to improve the management ability of management boards of projects.

The Government issued Resolution No. 63/NQ-CP on key tasks and solutions to boost economic growth, disbursement of public investment and sustainable exports in the remaining months of 2021 and early 2022, he said.

According to the General Statistics Office (GSO), the disbursed capital sourced from the State budget was estimated at 38.3 trillion VND (nearly 1.7 billion USD) in July, down 1.7 percent month on month and 12.4 percent year on year.

The figure between January and July reached 210.8 trillion VND, equivalent to 44.3 percent of this year’s target and up 5.6 percent from the same period last year.

The GSO’s statistics also showed that the Vietnamese economy expanded by 5.64 percent in the first half of this year, much higher than the growth rate of 1.82 percent recorded in the same period of last year.

The National Assembly set the target for GDP growth at around six percent this year but the Government set a higher goal at 6.5 percent./.