On the morning of August 31, the Ministry of Finance held an online conference with localities at 62 demand points on disbursement of public investment capital from foreign loans of the Government. Deputy Minister of Finance Tran Xuan Ha chaired the conference.

Deputy Minister Tran Xuan Ha speaking at the conference. 

Positive promotion activities

Through monitoring, it can be seen that the disbursement rate of public investment capital from ODA loans and foreign concessional loans of the central budget is targeted for additional localities at the conference at the Ministry of Finance at the end of June 2020 is 12.72% of the estimate. According to the synthesis, by August 27, 2020, this number increased to 21.86% of the estimate assigned by the localities.

For central capital to lend to localities, the disbursement rate for eight months reached 29.3% of the estimate assigned by localities. However, to achieve the assigned plan, the tasks set out for the last four months of the year are still quite difficult.

In order to accelerate the disbursement of public investment capital in general and foreign loans in particular, in 2020, the Government and the Prime Minister have taken many drastic measures to direct ministries, branches and localities, such as: organizing two online disbursement conferences nationwide; organized seven working groups to inspect, urge and remove difficulties and problems for production and business, accelerate the disbursement of public investment capital in 2020 at a number of ministries, agencies and localities led by the Prime Minister, the Deputy Prime Ministers, the Minister of Planning and Investment, and the Minister of Finance acting as the team leader; issued many resolutions and directives to urge the disbursement of public investment capital.

On the side of the Ministry of Finance, the Ministry has also directed relevant units to actively implement measures to promote disbursement.

Specifically, issue documents to urge governing bodies and project owners to accelerate the allocation and import of Tabmis and disbursement of public investment and foreign loans; hold preliminary conference and promote disbursement of public investment capital from foreign loans in the first six months of the year. After that, the Ministry of Finance issued a written report to the Prime Minister on the disbursement of ODA loans and concessional loans.

Besides, building and perfecting the system of relevant legal documents; organized five delegations to inspect the disbursement of public investment capital in general, including the disbursement of foreign capital, led by the Minister of Finance in Cao Bang, BacKan, Lang Son and Hai Duong provinces; three teams to inspect the disbursement of foreign capital in localities, led by leaders of the Department of Debt Management and Finance, leaders of the Investment Department are leaders in localities: Hanoi, HCMC, Quang Nam.

The Ministry of Finance also sent an official dispatch to 57 project management units assigned a large 2020 capital plan (over VND100 billion) to request the registration of a specific disbursement plan each month, from August 2020 to the end of the year to fit in disbursement work.

The conference took place at 62 online players
(except BacNinh because there is no delivered capital).

Disbursement speed has been more positive but still not satisfactory

Speaking at the conference, Deputy Minister Tran Xuan Ha said: The disbursement rate of public investment capital sources from foreign loans in July and August 2020 compared with the first six months of the year was much more positive, the speed increased 16% on average.

However, to sum up, the disbursement rates up to now compared to the same period of previous years and compared with management requirements are still low. If there are no timely solutions to remove difficulties and problems, from now to the end of the year, the rate will not increase much.

It can be said that disbursement is an important factor to promote socio-economic growth in 2020 and create momentum for the coming years, especially in the context that we are heavily affected by the Covid-19pandemic.

The Prime Minister has also directed ministries, branches, localities and project owners to increase their accountability in disbursement, and at the same time instructed that if the disbursement is not possible, reports must be made to consider to adjusting plans and transfer estimates to other ministries, branches and localities in need of disbursement.

On the other hand, according to the Deputy Minister of Finance, the nature of public investment capital sources of foreign loans are allocating capital based on loan agreements with very specific terms on project implementation duration and disbursement period. If the capital is not disbursed in time without being extended, the capital will be canceled.

“The cancellation of capital leaves us with a commitment fee. This will have a great impact on the quality and efficiency of the use of public investment capital as well as Vietnam's borrowing activities,”said the Deputy Minister.

The leaders of the Ministry of Finance also hope that localities will share information on disbursement evaluation; indicate difficulties, limit problems; analysis of the cause; review disbursement capacity, including the period of closing the balance sheet and comparing data, recording revenues and expenditures and evaluating the ability to disburse to the end of the year, to have a frank, objective, specific and offer positive solutions.