Public investment: thousands of projects cut, but total capital up by quadrillion VND

The total public investment capital has increased sharply in the 2021-2025 period compared with 2016-2020, but the number of projects has fallen significantly.

Public investment: thousands of projects cut, but total capital up by quadrillion VND

The Ministry of Public Investment's (MPI) report to the Prime Minister on medium-term public investment in 2016-2020 and predictions for 2021-2025 showed that the total investment capital of the state in the next period is VND2.75 quadrillion, an increase of 37.5 percent over the previous period (the amount approved by NA in 2016-2020 was VND2 quadrillion).

MPI is determined to maximize the mobilization of all resources in the economy to reach the state’s investment of VND2.75 quadrillion.

The total number of projects to be allocated capital for the period is 6,447, a 50 percent reduction from the 2016-2020 period. This includes 3,304 new projects, or 78.5 percent of that in the previous period.

The average capital of each project is VND154 billion, a two-fold increase compared with the VND88 billion in 2016-2020.

As such, the number of new projects is on the decrease.

However, when supervising public investment capital expenditure plans, MPI found that some ministries, localities and agencies do not strictly observe the regulations and principles on capital allocation. They start projects while not ensuring the capital arrangement for transitional projects, and approve projects that exceed the allocated capital.

The problem needs to be fixed, and the rampant, fragmented investment needs to be stopped so that unfinished projects can be completed.

Only 7,354 projects were completed in the 2016-2020 period, or 66.2 percent of the total projects in the medium-term plan.

According to MPI, a series of large transport projects will be developed with public capital in the next five years.

The Government will spend VND97.9 trillion on 74 key inter-region projects, and arrange VND8.1 trillion to complete 10 projects belonging to the coastal route from Quang Ninh to Nghe An.

Regarding the criteria for capital allocation in 2021-2025, MPI said the allocation will follow the laws on Public Investment and State Budget, and National Assembly and National Assembly Standing Committee’s resolutions and Government’s decisions.

Public investment capital will be allocated to key industries and sectors, large projects and important projects at the national level that connect regions and create new development space, promoting the growth areas of Hanoi, HCM City and key economic zones.

MPI estimated that in 2020 every one percent in increase of public investment disbursement led to a 0.06 percent GDP growth rate over the previous year. As such, increased public investment capital in the next five years is expected to give a push to GDP growth.

The halving in number of projects and the twofold increase in capital of each project shows that public investment has become less fragmented.

 

Disbursement

MPI estimated that in 2020 every one percent in increase of public investment disbursement led to a 0.06 percent GDP growth rate over the previous year. As such, increased public investment capital in the next five years is expected to give a push to GDP growth.

Prime Minister Pham Minh Chinh on April 15, during his first cabinet meeting ordered to boost public investment disbursement as one of the key solutions to stimulate national economic growth.

MPI on April 20 sent a document to ministries, agencies, and localities asking them to report barriers involving disbursement of state budget capital.

Speeding up disbursement is one of the biggest issues. Slow disbursement was seen in 2016-2019, especially in 2018 and 2019 with disbursement rates of 71.69 and 78.68 percent, respectively.

The Government then had to propose to the National Assembly an unprecedented solution to speed up disbursement – allowing the Government to adjust the investment plan with the central budget capital among ministries, central agencies and localities.

Four Government resolutions were released, and six conferences and seven government working delegations were organized in an effort to speed up disbursement.

Thanks to a series of drastic measures, the disbursement in 2020 reached its highest ever rate.

The Ministry of Finance (MOF) has warned that the slow disbursement may come back. The disbursement rate by April 30, 2021 was only 16.66 percent.

The ministry reported that in the first four months of the year, five ministries and 10 localities had disbursement rates of over 20 percent of the plans. Localities with high disbursement rates included Thai Binh (76.74 percent), Ha Nam (50.57 percent), Hung Yen (43.21 percent), Thanh Hoa (42.39 percent) and Quang Ninh (39.62 percent).

Meanwhile, 41 out of 50 ministries and 26 out of 60 localities had disbursement rates of below 15 percent. Seventeen ministries have not made disbursements. 

Luong Bang

Vietnam to spend $124.5 billion on public investment over next five years

Vietnam to spend $124.5 billion on public investment over next five years

Vietnam plans to outlay 2.87 quadrillion VND (124.5 billion USD) on public investment in the 2021-2025 period, up 120 trillion VND compared to the previous estimate.

Disbursement of public investment at record since 2016, still misses Gov’t target

Disbursement of public investment at record since 2016, still misses Gov’t target

The disbursement of public investment was estimated at VND398 trillion as of the end of December, meeting 82.8 per cent of the Government’s plan – the highest rate in the 2016-20 period, according to the Ministry of Planning and Investment.  

 
 

Other News

.
Latest drastic moves in Vietnam’s vaccine diplomacy strategy
Latest drastic moves in Vietnam’s vaccine diplomacy strategy
FEATUREicon  26/08/2021 

Through vaccine diplomacy, Vietnam has so far received millions of vaccine doses from the support of the international community.

Vietnam-US relationship: comprehensive and strategic
Vietnam-US relationship: comprehensive and strategic
FEATUREicon  26/08/2021 

This is the time to review the relationship between Vietnam and the US, 

Hotels, private hospitals join fight against Covid-19
Hotels, private hospitals join fight against Covid-19
FEATUREicon  26/08/2021 

Many resources in society have been mobilized for testing, vaccination and medical quarantine, which has improved service quality and helped businesses earn revenue.

Teachers explain ’10.0 GPA phenomenon’ among primary school students
Teachers explain ’10.0 GPA phenomenon’ among primary school students
FEATUREicon  25/08/2021 

Two famous secondary schools for the gifted in Hanoi and HCM City have found it difficult to enroll students for the 2021-2022 academic year because there are too many students with a perfect 10.0 GPA (grade point average).

Directorate of Market Surveillance officials arrested for abuse of power
Directorate of Market Surveillance officials arrested for abuse of power
FEATUREicon  25/08/2021 

While many officials have been honored for their excellent fulfillment of official duties, many others have been prosecuted for their involvement in trade fraud.

Experts warn of high risks from real estate firms' corporate bond issuance
Experts warn of high risks from real estate firms' corporate bond issuance
FEATUREicon  25/08/2021 

Corporate bonds issued by real estate firms account for a high proportion of securities that mature in three years. Experts warn of high risks if the real estate market cannot recover by that time.

State revenue from registration fees increases
State revenue from registration fees increases
FEATUREicon  24/08/2021 

The registration fees collected for the state budget increased from VND11,816 billion in 2012 to VND40,194 billion in 2019, up by 240% or VND28,378 billion.

Hanoi protects green zones from the core
Hanoi protects green zones from the core
FEATUREicon  25/08/2021 

Each residential area, commune and ward are considered the core level – the ‘cell’ that needs to be protected. Many places in Hanoi are effectively promoting the "green zone" model for safe residential areas.

More medical data needed to fight Covid-19
More medical data needed to fight Covid-19
FEATUREicon  24/08/2021 

Data from epidemiological studies using antibody tests to measure the proportion of the population who have acquired protective immunity will help to make more accurate assessments about the epidemic situation.

Street-front high-rise owners incur losses as renters leave
Street-front high-rise owners incur losses as renters leave
FEATUREicon  24/08/2021 

The long fourth Covid-19 outbreak and social distancing regulations have posed great challenges to the office leasing market.

Businesses seek interest rate cuts, banks worry about declining profits
Businesses seek interest rate cuts, banks worry about declining profits
FEATUREicon  24/08/2021 

Business associations and industries have repeatedly asked commercial banks to ease lending interest rates to share difficulties with them in the Covid-19 pandemic.

Six production options offered to companies amid pandemic
Six production options offered to companies amid pandemic
FEATUREicon  23/08/2021 

The HCM City Department of Industry and Trade has released guidance on safe production in the conditions of the fight against Covid-19 pandemic. There are six options:

Four-day campaign suceeds in stopping vegetable price chaos in HCM City
Four-day campaign suceeds in stopping vegetable price chaos in HCM City
FEATUREicon  21/08/2021 

A campaign deployed within four days helped rescue the vegetable distribution network in HCM City and stop price fluctuations during social distancing.

A breath of fresh air in literature textbooks for sixth graders
A breath of fresh air in literature textbooks for sixth graders
FEATUREicon  21/08/2021 

Teachers say sixth graders this year will be able to access literature works that their parents and grandparents did not have in their textbooks.

Highly contagious Delta variant lengthens outbreak in Vietnam
Highly contagious Delta variant lengthens outbreak in Vietnam
FEATUREicon  20/08/2021 

The Delta variant of the SARS-CoV-2 virus, with its rapid and strong spread in a very short time, has put huge pressure on the health system.

A midnight call from a pregnant woman, and return trips to hometowns
A midnight call from a pregnant woman, and return trips to hometowns
FEATUREicon  20/08/2021 

On the evening of August 15, Pham Thi Minh Hien, deputy director of the Phu Yen Department of Labor, War Invalids and Social Affairs, received a call for help from a young couple.

Joining forces with VietNamNet to stamp out the pandemic
Joining forces with VietNamNet to stamp out the pandemic
FEATUREicon  19/08/2021 

In order to make a contribution to the country’s fight against Covid-19, VietNamNet has launched the "Joining forces with VietNamNet to stamp out the pandemic" program.

It’s time for Vietnam to begin pilot study on cryptocurrency: expert
It’s time for Vietnam to begin pilot study on cryptocurrency: expert
FEATUREicon  22/08/2021 

The Prime Minister has assigned the State Bank of Vietnam (SBV) to study and try to use a cryptocurrency based on blockchain technology as a part of a strategy on e-government in 2021-2025.

Vietnamese graduate wins full scholarship to attend medical school in the US
Vietnamese graduate wins full scholarship to attend medical school in the US
FEATUREicon  22/08/2021 

After graduating from Wellesley College majoring in biochemistry, Trinh Mai Chi, with impressive research achievements, has won a full scholarship to study at Johns Hopkins, the world’s leading medical university.

After restructuring, banks gear up, ready for big deals
After restructuring, banks gear up, ready for big deals
FEATUREicon  19/08/2021 

After many years of undergoing restructuring, joint stock banks have expanded operation scale and profits.

 
 
 
Leave your comment on an article

OR QUICK LOGIN