The Commercial Bank for Foreign Trade of Vietnam (Vietcombank) and the Japan Bank for International Cooperation (JBIC) exchanged a credit contract worth $200 million to fund renewable energy projects in Vietnam.

Vietnam’s average disbursement rate is much lower than that of other recipients of the Asian Development Bank’s ODA loans, largely due to cumbersome and time-consuming procedures, said Eric Sidgwick, ADB country director for Vietnam.

Disbursement of official development assistance (ODA) hit over VND1.6 trillion in the first five months of this year.

Chinese investors are pouring money ino Vietnam as a shelter from the US-China trade war.

As more Chinese expand their businesses in Vietnam, many domestic enterprises have become Chinese partners or have been taken over by Chinese.

Nearly half of the transport BOT projects under the management of the Directorate for Roads of Vietnam (DFRV) report low revenue, with many of them incurring big losses.

To Vietnamese, Chinese contractors means ‘low quality’. However, they are not be the fatal problem of Vietnam’s infrastructure works.

The government is submitting to the National Assembly a mammoth north-south express railway project worth $59 billion.

Some economists warn that the higher investment capital for national important projects may make it more difficult to manage public projects and lend a hand to unnecessary use of state funds.

The Ministry of Planning and Investment (MPI) says it will change the current policy on attracting and using FDI and begin to offer investment incentives more selectively.

The National Assembly has approved a plan to raise the foreign ODA ceiling from VND300 trillion to VND360 trillion ($15.41 billion) for medium-term public investment in the 2016-2020 period.

The developers of road projects under the BOT (build, operate, transfer) investment mode complain that lending interest rates are too high, up to 10.5 percent per annum. 

Instead of refusing Chinese capital, it would be better for Vietnam to receive capital flow in a tactical way to serve investment for development, experts say.

Analysts say Vietnam is facing dual difficulties: it has to prepare for the period when ODA (official development capital) capital will decrease, and must also bear pressure as 50 percent of domestic debts will be due in three years.

Vietnam, which has been using ODA (official  development assistance) capital for 25 years, has looked at the situation realistically and found the problems of ODA.

Thermal power will continue to be the major electricity generation source for Vietnam in upcoming years, but citizens are becoming increasingly vocal about the undesired environmental impact of such projects. 

VietNamNet Bridge - The interest rates offered by China are twice as much as other lenders, while the lending conditions are less preferential.

 VietNamNet Bridge – HCM City authorities have asked the Government to consider allowing the city and provincial level administrative agencies to approve metro projects to ensure that construction remains on schedule.

VietNamNet Bridge - Economists agree that private investors should also be allowed access to official development assistance capital, but warn that credit may be used improperly. 

VietNamNet Bridge - Many investors are complaining that they are in a dilemma because of the law on PPP investments.