Solutions sought to accelerate disbursement of ODA
Hanoi (VNA) – The ODA National Steering Committee held
a meeting with
donors in Hanoi on June 17 to seek solutions to speed up the disbursement of ODA
capital and preferential loans, which has showed signs of slowing down in
recent years.
The meeting, chaired by the steering committee’s
chairman Deputy
Prime Minister Pham Binh Minh, was attended by representatives from six
donors which are the World Bank (WB), the Asian Development Bank (ADB), the Japan
International Cooperation Agency (JICA), the Export-Import Bank of Korea (KEXIM),
the French Development Agency (AFD) and the KfW Development Bank.
As of 2018, Vietnam had received 80
billion USD in ODA and preferential loans, making it one of the largest recipients
of this type of funding in the world. About 80 percent of the amount was
provided by the six above-mentioned donors.
Of the total amount, 7 billion USD was
in the form of non-refundable aid, more than 70 billion USD was concessional
loans with interest rates under 2 percent, and 1.62 billion USD was loans under
less generous conditions but their interest rates were still lower than those
of commercial ones.
This is proof of Vietnam’s efforts to
mobilise external resources for national development. Donors shared the view
that Vietnam has effectively used loans, which is one of the reasons why they
continued to commit ODA and concessional loans for Vietnam in the past years.
Reports of JICA, ADB and WB said their
projects in Vietnam had been implemented better than those in other countries,
with a high rate of projects completed and achieving set targets.
In 2018 alone, the six donors committed
28.9 billion USD for Vietnam.
However, the disbursement rate of ODA
and loans in Vietnam has slowed, dropping from a high 23.1 percent in 2014 to
just 11.2 percent in 2018, which was lower than the average global rates
recorded by the six donors.
Of the committed capital for Vietnam
in 2018, up to 16.9 billion USD is yet to be disbursed.
The delay in disbursement was
attributable to complicated and overlapped procedures, low readiness for projects
and cumbersome process and requirements for disbursement.
The slow disbursement of capital
resulted in projects not meeting implementation schedules and targets while
pushing up costs, affecting investment effectiveness and GDP growth.
The situation requires stronger
commitment and more drastic efforts from all related sides to remove obstacles.
It was proposed at the meeting that the six donors need to coordinate with the
Vietnamese Government in building the mid-term public investment plan using ODA
and concessional loans for 2021-2025 as one of the solutions.-VNA