Low disbursement of public investment sourced from foreign borrowing

The disbursement of public investment must be considered a key task to put works into operation and promote socio-economic development. (Photo: baochinhphu.vn)

The disbursed public investment sourced from foreign borrowing was estimated at more than 9 trillion VND in the first 11 months of the year, equivalent to only 26% of the plan, said an official from the Ministry of Finance.

In order to improve the disbursement rate of this capital, it was proposed that procedures be further simplified and accountability be enhanced, said Truong Hung Long, Director of the ministry's Debt Management and External Finance Department.

Although the disbursement rate was accelerated in the second half of this year after having achieved a modest rate of just 9% in the year’s first half, Long said that the result was disappointing.

According to the Ministry of Finance, as of November 30, eight out of 13 ministries and agencies proposed lowering the plan of public investment sourced from foreign borrowing by a total of nearly 3.68 trillion VND (not excluding 250 billion VND of the Ministry of Natural Resource and Environment and 50 billion VND of the Ministry of Health which were already approved), and by 8.8 trillion VND of 35 out of 59 localities.

The proposed decreased sum totalled more than 12.4 trillion VND, or 36.5% of the plan.

Long said that only three ministries and five localities had disbursement rates of more than 50% of the plan, 54 localities and 10 ministries below 50% and notably, six ministries and four localities failed to disburse any public investment sourced from foreign borrowing.

A representative from the Hanoi People’s Committee said that the COVID-19 pandemic in early 2022 affected the implementation of public–invested projects.

Long proposed the Government to issue amendments to Decree No 114/2021/ND-CP dated December 16, 2021 about the management and use of official development assistance (ODA) and concessional loans towards further simplifying procedures and enhancing accountability.

Vo Huu Hien, the department’s deputy director, said that for public investment sourced from foreign borrowing which failed to be disbursed this year, based on the projects’ implementation progress, ministries, agencies and localities would develop the capital plan for next year if the loan agreements were still valid.

For expired loan agreements, the undisbursed sum would be returned to the lenders and other sources would be arranged to continue to implement the projects.

Hien pointed out reasons for slow disbursement, such as slow site clearance, problems in bidding procedures and adjustments to projects and loan agreements.

Currently, documents for the disbursement of an estimated sum of 2.8 trillion VND were now submitted to the State treasury. If this sum was disbursed, the disbursement rate of public investment sourced from foreign borrowings would be around 34-35% of the plan for the full year.

Overall, the disbursement of public investment from all sources was 58.33% as of the end of November, leaving a huge workload for the remaining days of this year.

Minister of Planning and Investment Nguyen Chi Dung said that the disbursement of public investment must be considered a key task to put works into operation and promote socio-economic development.

Ministries, agencies and localities must enhance discipline in the disbursement of public investment, he said, adding that focus must be placed on speeding up site clearance and removing bottlenecks in land and natural resources policies.

Preparations must be geared up to complete investment procedures to ensure readiness and feasibility for early implementation of projects and disbursement of capital from early 2023, he said./.