The draft resolution was put into discussion at the National Assembly Hall on June 8 and is expected to be approved on June 24. If so, it will replace the more restrictive 14th National Assembly’s Resolution No 54, thereby fostering the development of the city considered to be the ‘economic locomotive’ of the country.

Reviewing the four-year implementation of Resolution No 54 in 2018-2022, HCM City leaders said most of the specific policies on financial management aiming at increasing revenue, including revenue from state-owned enterprise (SOE) equitization and  public asset auctions, have not been fully exploited.

One of the reasons behind this is that the city doesn’t have the right to autonomy and it still has to ask for permission from ministries and branches. Also, ministries and branches tell the city to consider common laws and regulations, and not apply the specific mechanism as stipulated in Resolution No 54.

A representative of the Ministry of Planning and Investment (HCM City) said HCM City sent hundreds of documents to the ministry to consult with it on many issues. This makes people believe that other ministries also received the same number of documents.

Therefore, the new resolution, when approved, is hoped to help HCM City remove the bottlenecks to help the city take off.

In the draft resolution, the policies are in four categories – investment; finance-budget; land management; and apparatus programming and organization. 

The draft document comprises regulations that help remove obstacles for the city, and new regulations that help tackle current problems, but do not create a new open corridor for development.

For example, in investment, the draft resolution says the city can implement investment projects under the BT (build, transfer) mode with payment from the city’s budget. In fact, the mode of investment has been excluded from the PPP Law (private public partnership) following worries about public property losses.

In another example, the draft resolution allows installation of rooftop solar power systems on the roofs of head offices of administrative agencies and public non-business units in the city which provide electricity to the agencies. 

But the permission is not ‘specific’ if referring to the newly approved eighth national power development plan (PDP 8), which says that 50 percent of agency buildings and 50 percent of residential houses will have rooftop power systems by 2030.

In general, experts say that the regulations in Resolution 54 are not ‘specific’ which cannot make a breakthrough in the development of HCM City.

Transport 

Experts and academics are also discussing the draft resolution outside the ongoing NA session.

To Van Truong, a researcher, commented that HCM City has hundreds of transport technical infrastructure, environment, education and healthcare projects that need to be developed with total capital of over VND320 trillion within four years, but the local budget can provide only half of that sum.

There are many urgent projects that have not kicked off, or are under execution but going at a snail’s pace because of the lack of capital, such as the Xuyen Tam canal, Hy Vong canal, HCM City - MocBai Highway, and HCM City - ChonThanh Highway upgrading. 

The city also needs capital for the expansion of Highway No13, Highway No50, Belt Road No 2 and 3, the speeding up of the HCM City - Ben Luc - Long Thanh Highway, and the construction and upgrading of hospitals.

“Why does HCM City ask for VND6.5 trillion from the state budget, but it can receive VND586 billion only?” he said.

The researcher stressed that if HCM City had sufficient capital to develop just one of these needed projects, it would make a breakthrough in growth, and would not see such sluggish growth as seen currently.

HCM City makes the greatest contribution to the state budget, but expenditures for the city from the budget are the lowest figure.

HCM City, the largest economic center in the country, makes up 22 percent of GDP. For every one percent growth rate the city can gain, the country would have 0.2 percentage point more and this would have spread to other localities in the country.

HCM City’s growth slowdown in the first quarter of 2023 raised a lot of questions, and the draft resolution on a specific mechanism for HCM City is being considered.

Former head of the Central Institute of Economic Management Nguyen Dinh Cung commented that HCM City needs a new institution, the result of the second wave of reform, and its essence is still ‘market, market and more market’. 

Vietnam needs an institution that is “more market, is freer and more sophisticated” which will create more opportunities and motivate people, businesses and state agencies to innovate, and 'dare to think and dare to do'. Only in such an environment will talents have a ‘breeding ground’ to contribute to the development of the country.

Lan Anh