Capital allocation for 2016-2020: Need to solve low-efficieny investment

	Vietnam enters top 5 biggest foreign investors in Cambodia
	Equitization must ensure the sale of state capital
	The State Treasury: Disbursement of capital construction investment reaches a high rate

The Vice Chairman of the National Assembly, Mr. Phung Quoc Hien chaired the discussion.

Authorized by the Government to present the report, the Minister of Planning and Investment, Mr. Nguyen Chi Dung said: Till now, the Government has distributed all the total capital investment plan for medium-term approved by the National Assembly. Accordingly, there are no Ministries, departments or localities to be allocated capital, not in line with the Law. In particular, there has been a large amount of priority capital to be allocated for debt repayment, repayment of advance capital, allocation of counterpart fund for ODA, PPP, etc.

Regarding the detailed plan and allocation of the first phase, the Minister said that the Government implemented the first phase of medium-term public investment plan with the total capital of more than 1,134.6 trillion vnd, equivalent to 56.7% of the total medium-term capital approved by the National Assembly and 65.2% of the total capital allocation.

In the first phase of allocation, the Government allocated 163.34 billion vnd to support 458 communes in 12 provinces in the Mekong River delta in the national target program on building new rural areas; allocated 7,300 billion vnd for localities to implement the objectives of housing support for people with merit; 130 billion vnd of Government bonds for the resettlement project such as resettlement of Son La hydropower.

Regarding the medium-term public investment plan of more than 605 trillion vnd in the second phase of allocation, the Government has requested Ministries, sectors, and localities to deal with outstanding issues such as the climate change adaptation and green growth targeting program; Coastal road investment; solutions for the Social Policy Bank and Vietnam Development Bank (VDB).

This time, the Government wants to allocate 20.865 trillion vnd in the medium term for the Social Policy Bank because the bank has a good performance with bad debts accounting for only 0.75% and overdue loans of 35% and debt freeze around 0.4%. At the same time, the Social Policy Bank has actively contributed to the implementation of the social security and poverty reduction policy in the past 15 years and is currently assigned to carry out some new tasks.

For the Vietnam Development Bank, the Government has proposed to allocate 12,670 billion vnd to the bank ( the interest and management fee until 31^st December 2016). The remaining capital is estimated at 15,015 billion vnd allocated to the VDB. The Government has proposed an addition of 2,000 billion vnd to the Social Policy Bank to support the development of social housing, added 4,000 billion vnd to the target program in the East Sea and islands and the remaining amount which is unallocated is 9,015 billion vnd.

Examining the Government's plan, the Finance and Budget Committee found that one of the requirements for allocating funds for 2016-2020 is to solve low-efficiency investment and low-capital allocation, which leads the incomplete projects.

However, the list of projects which were submitted by the Government had a lot of projects with low capital compared to the total investment, so it was difficult to be able to complete the project on schedule. Therefore, the Finance and Budget Committee has recommended that, for low-cost projects, the Government should require ministries, sectors, and localities to commit to ensuring the feasibility of mobilizing legal capital. Others to complete the project on schedule, do not allow these units to postpone to avoid continuing unfinished projects, causing the burden of balancing, allocation of capital investment in the next stage. In the case where the projects fail to meet the requirements and conditions on capital to ensure the completion, the proposal is not to allocate capital immediately.

Tthe Finance and Budget Committee also agreed to allocate the chartered capital to the Vietnam Development Bank after the Government reported the model assessment, outstanding debts, performance, development orientation, plan for charter capital arrangement, management fees and interest rate difference of the bank.

BIDV asked to help expand investment abroad Prime Minister Nguyen Xuan Phuc has asked the Bank for Investment and Development of Vietnam BIDV to ...

Regarding this issue, the members of the Standing Committee of the National Assembly agreed on the Government's thorough review of the criteria for putting the project in the medium-term public investment portfolio fairly and practically instead of the conclusion of the senior leaders when they work in localities".