US$17 billion in ODA loans yet to be disbursed

Some US$17 billion worth of official development assistance (ODA) loans pledged by six development banks have yet to be disbursed, heard attendees at a meeting held recently.

US$17 billion in ODA loans yet to be disbursed
Workers at the construction site of an elevated section of the Metro Line No. 1 project, which uses official development assistance loans from the Japanese government

The meeting was attended by representatives of the National Steering Committee for ODA and Preferential Loans and six development banks: the World Bank (WB), the Asian Development Bank (ADB), the Japan International Cooperation Agency, the Export-Import Bank of Korea, French Development Agency AFD and Germany's KfW Development Bank.

Speaking at the meeting, Norio Saito, ADB deputy country director in Vietnam, said that the ODA loans pledged by the six banks have dropped but are still important to Vietnam.

After the financial crisis in 2008, the pledged amount increased to US$32.8 billion in 2013 but fell to US$28.9 billion last year.

Saito said that the ODA loan amounts that have yet to be disbursed are equivalent to 7% of Vietnam’s gross domestic product (GDP).

The disbursement rate plunged from 23.1% in 2014 to 11.2% last year, much lower than the average rate of the six banks. The average rates of ADB and WB in 2018 were 21% and 20.2%, respectively.

The slow disbursement has resulted in the slow progress in the execution of ODA-funded projects, raising their investment costs, reducing investment effectiveness and negatively affecting the country’s GDP growth.

 

In addition, the project’s quality may be affected, and contractors may quit their jobs.

Further, infrastructure projects will be completed late, affecting local residents’ and private enterprises’ confidence in the Government’s ability to manage projects, Saito added.

For his part, Deputy Prime Minister Pham Binh Minh said the slow disbursement of ODA and preferential loans, pointing out that the revised Public Investment Law, passed by the National Assembly, sets out regulations on the disbursement of public investment, giving more autonomy to lower-level agencies to ease the disbursement.

Moreover, the Government will assign the Ministry of Planning and Investment to prepare draft decrees replacing the Government’s Decrees 46 and 132 on the management and use of ODA and other preferential loans from foreign investors.

Thuy Dung

ODA projects employ foreign consultants at high costs

ODA projects employ foreign consultants at high costs

Official development assistance (ODA)-funded projects have been found to employ foreign consulting firms at high costs, noted a report from the State Audit of Vietnam (SAV).  

No Japan newly-committed ODA projects for Vietnam in 2018

No Japan newly-committed ODA projects for Vietnam in 2018

No new credit from Japan was committed for Vietnam in fiscal year 2018 due to Vietnamese policies on public debt limits and delay in administrative procedures.

 
 

Other News

.
Vietnam emerges as the world’s No2 rice exporter
Vietnam emerges as the world’s No2 rice exporter
BUSINESSicon  27/07/2020 

Vietnam has beaten Thailand to become the second biggest rice exporter in the world after the latter decided to slash rice exports due to prolonged drought and strong baht.

Competitive power market still afar
Competitive power market still afar
BUSINESSicon  27/07/2020 

There are three criteria for assessing goods and services— including prices, quality and customer service. 

Standardization for agro-value chain
Standardization for agro-value chain
BUSINESSicon  27/07/2020 

When it officially takes effect, the EU-Vietnam Free Trade Agreement (EVFTA) will have a positive impact on promoting Vietnam’s exports, especially agro-products, to the EU.

Downhill likely after climax
Downhill likely after climax
BUSINESSicon  27/07/2020 

Rice is a rare spotlight in Vietnam’s agro-product exports in the first half of this year. However, the good performance may not be maintained in the second half of the year.

Vietnam imposes tariffs on foreign plastic film
Vietnam imposes tariffs on foreign plastic film
BUSINESSicon  26/07/2020 

The ministry of Industry and Trade (MoIT) has applied anti-dumping measures on some products with biaxially oriented polypropylene (BOPP) film originating from China, Thailand and Malaysia.

Improved quality and higher demand boost Vietnam rice export outlook
Improved quality and higher demand boost Vietnam rice export outlook
BUSINESSicon  27/07/2020 

In the first half of this year, rice export value jumped 18.6% year-on-year to US$1.71 billion.

Vietnam urged to be cautious about Chinese investment
Vietnam urged to be cautious about Chinese investment
BUSINESSicon  27/07/2020 

Growing Chinese investment to Vietnam could turn the Southeast Asian country into a transshipment point for China to reroute its exports to a third country.

Vietnam gov’t to offer extraordinary incentives for high-impact FDI projects
Vietnam gov’t to offer extraordinary incentives for high-impact FDI projects
BUSINESSicon  26/07/2020 

By fulfiling certain criteria, some foreign investors would receive special treatment, said Minister of Planning and Investment Nguyen Chi Dung.

Australian firm alleged of transfer pricing worth over US$116 million
Australian firm alleged of transfer pricing worth over US$116 million
BUSINESSicon  26/07/2020 

The State Audit Office of Vietnam requested the police to investigate the case.

Vietnam construction industry stays positive during Covid-19
Vietnam construction industry stays positive during Covid-19
BUSINESSicon  26/07/2020 

The construction industry grew 4.5% year-on-year during the first six months of 2020, which was higher than the GDP growth rate of 1.8%.

EC allows Vietnamese exporters to extend deadline of REX applications
EC allows Vietnamese exporters to extend deadline of REX applications
BUSINESSicon  26/07/2020 

The European Commission (EC) has given the green light for Vietnam’s exporters to extend the deadline of applying for the registered exporter system (REX) until late 2020, 

Southern Vietnamese real estate market: emergence of large M&A deals
Southern Vietnamese real estate market: emergence of large M&A deals
BUSINESSicon  26/07/2020 

The southern real estate market has witnessed a series of impressive mergers and acquisitions (M&A) deals. This trend is expected to be more vibrant in the near future. 

E-wallet providers ask to extend deadline of verification
E-wallet providers ask to extend deadline of verification
BUSINESSicon  26/07/2020 

 E-wallet service providers want to extend the deadline for users to complete identity verification.

Ministry launches PayGov to upgrade national public portal
Ministry launches PayGov to upgrade national public portal
BUSINESSicon  26/07/2020 

The Ministry of Information and Communications (MIC) launched a national payment support gateway (PayGov) yesterday in Ha Noi in the latest move to boost e-government in Vietnam.

Pandemic ravages household businesses and MSMEs: survey
Pandemic ravages household businesses and MSMEs: survey
BUSINESSicon  26/07/2020 

The COVID-19 pandemic has substantially reduced revenue for both household businesses (HBs) and micro, small and medium enterprises (MSMEs), 

Japanese firms choose Viet Nam for production expansion
Japanese firms choose Viet Nam for production expansion
BUSINESSicon  26/07/2020 

Fifteen Japanese firms chose Vietnam as the destination for their production expansion within the Japanese government’s programme to support Japanese firms to diversify their value chains in foreign countries, according to JETRO.

Vietnam Banks Association urges MIC to reduce telecommunication charges
Vietnam Banks Association urges MIC to reduce telecommunication charges
BUSINESSicon  26/07/2020 

The Vietnam Banks Association has just sent a dispatch to propose the Ministry of Information and Communications lower charges for banking services via SMS.

R&D spending key to join global supply chain: executives
R&D spending key to join global supply chain: executives
BUSINESSicon  25/07/2020 

Challenges will overwhelm opportunities for Vietnamese part suppliers if they are unable to find ways to upgrade technology and meet international production standards, business executives said on July 24.

Vietnam likely to export 6.7 million tonnes of rice this year
Vietnam likely to export 6.7 million tonnes of rice this year
BUSINESSicon  25/07/2020 

Vietnam is likely to reach its rice export target of 6.7 million tonnes this year thanks to favourable market conditions and high global demand, according to the Ministry of Agriculture and Rural Development.

Korean multinationals suggest solutions to ease difficulties in Covid-19
Korean multinationals suggest solutions to ease difficulties in Covid-19
BUSINESSicon  27/07/2020 

Vietnam Airlines’ airplanes which have been left idle because of Covid-19 could be used to carry cargo, offering benefits to both the air carrier and export companies.

 
 
 
Leave your comment on an article

OR QUICK LOGIN