Orders made to push disbursement of public funds
Orders made to push disbursement of public funds
To prevent low economic growth next year and slow attraction of private investment, the government has continued ordering ministries and localities to intensify public investment.
Three days before the National Assembly (NA) kicked off its fourth session in Hanoi on October 20, Prime Minister Pham Minh Chinh signed and enacted Directive No.19/CT-TTg on boosting public investment disbursement.
The directive said that public investment disbursement in the first nine months of this year was VND35 trillion ($1.52 billion) or 16 per cent higher than in the same period last year, meeting 46.7 per cent of the disbursement plan earlier assigned by the prime minister. “However, the speed of disbursement remains slow, failing to meet desired requirements,” stated the directive.
The government wants to see the disbursement rate for this year reach 95-100 per cent of the plan assigned by the prime minister. The total public investment capital for 2022 is about $25.22 billion fixed by the NA.
The General Statistics Office estimates that for every 1 per cent increase in public investments, Vietnam’s GDP can rise 0.06 per cent.
The government has determined that accelerating such disbursement is one of the key political tasks of 2022 and 2023 in order to boost economic growth, and maximise the implementation of socioeconomic development goals, and “must go together with ensuring the quality of works and effectiveness of capital usage”.
“Bigger efforts and determination must be made to accomplish all targets already set in public investment disbursement, to overcome all difficulties, and with more suitable solutions taken,” the directive added.
A government report sent to the NA last week admitted that public investment disbursement continued to be a bottleneck for economic growth. It is estimated that as of September 30, total disbursement hit about $11 billion, meeting just under 46.7 per cent of the disbursement plan earlier assigned by the prime minister and lower than the rate of 47.38 per cent in the same period last year.
“Slow disbursement will continue having negative impacts on the goals for economic growth, and reducing the effectiveness of capital usage,” stated Vu Hong Thanh, chairman of the National Assembly Economic Committee. “Though the government has highlighted three groups of reasons behind the slow disbursement (see box), it is recommended that the government continue proposing specific solutions so that this grey disbursement situation can be solved as soon as possible.”
The government has also said that all projects with slow disbursement will see their capital transferred to other projects which are implemented effectively but suffering from capital shortages. Leaders of ministries and localities with ineffective projects will face possible punishments.
Since early this year, the government and Prime Minister Chinh have promulgated directive documents and organised three online conferences on disbursement.
At the same time, six working groups have been established, headed by four deputy prime ministers and the ministers of planning and investment and finance.
