Vietnam will continue pumping a great deal of money into public investment with a view to reaching the country’s economic growth goal for next year.
|New capital sums will help complete critical infrastructure projects, photo Thanh Tung |
The National Assembly (NA) has adopted a plan for boosting public investment for 2021 after setting a growth target of about 6 per cent. Accordingly, total capital from state coffers for next year will be VND477.3 trillion ($20.75 billion), up 1.4 per cent against the similar plan for this year. In which, money from the central budget will increase 0.9 per cent on-year, and money from the local coffers will expand 1.9 per cent on-year.
The VND477.3 trillion public investment capital will be earmarked for many projects. For example, VND16 trillion ($695.65 million) will be used for national target programmes, VND15.038 trillion ($653.82 million) for the project on constructing the North-South Expressway; VND4.66 trillion ($202.6 million) for the project on land compensation and resettlement for the Long Thanh International Airport; VND2.8 trillion ($121.74 million) for developing coastal roads; and 4.7 trillion ($204.34 million) for supporting localities in implementing some key new infrastructure projects.
According to the Ministry of Planning and Investment (MPI), in 2021, these new investment capital sums, in addition to capital attracted from private investors, will help to complete the construction of the eastern cluster of the North-South Expressway project, many national coastal roads, connection road lines, airports, and seaports.
MPI Deputy Minister Tran Quoc Phuong told VIR that amid existing massive difficulties caused by the COVID-19 pandemic, accelerating public investment “will be among the best solutions to fuel the economy and enable it to hit the economic growth rate of about 6 per cent this year.”
It will take years to complete procedures for a project under the public-private partnership (PPP) format, so for the time being public investment is a feasible solution, Phuong added.
In June, the National Assembly Standing Committee decided that three out of eight expressway projects, which are parts of the eastern cluster of the North-South Expressway project, would be funded by the state budget. These three projects, in which construction has been commenced, include Mai Son-National Highway No.45 (63.4km), Vinh Hao-Phan Thiet (106km), and Phan Thiet-Dau Giay (98km). As of October 31, their disbursed money was VND2.52 trillion ($109.56 million), reaching 75.03 per cent of the assigned VND3.356 trillion ($145.9 million) for 2020.
According to the committee, these three projects are of great importance and urgency for investment due to rising demand for traffic. Earlier, all of them had been planned for investment under the PPP format.
“The new investment capital from the state will contribute to reducing travelling time for transporting passengers and goods, saving fuel, paring down transport costs, and improving the economy’s competitiveness,” stated a report on public investment for the 2021-2025 period recently submitted to the NA. “This will also contribute to expanding spaces for development, creating new land areas for production and business, and enhancing the effectiveness of maritime resources and maritime economic development.”
According to the Ministry of Finance, in the entire 2020, about VND633 trillion ($27.5 billion) worth of public investment must be disbursed. This sum includes VND470.6 trillion ($20.46 billion) assigned for this year and VND162.4 trillion ($7 billion) transferred to 2020 from 2019.
From January to late October, VND321.53 trillion ($13.97 billion) or 68.3 per cent of the total public investment for 2020 was disbursed, higher than the 54.7 per cent in the same period last year, with 13 ministries and government agencies and 21 localities having a disbursement rate of over 70 per cent.
“Efforts are to be made to push up the construction rate of key transport projects such as the eastern cluster of the North-South Expressway, railways, and roads,” stated MPI Minister Nguyen Chi Dung. “We will have to complete and put into operation urban metro lines in Hanoi and Ho Chi Minh City. More investment will be placed in upgrading the Tan Son Nhat, Noi Bai, and Danang international airports, and constructing the first phase of the Long Thanh International Airport. We will also upgrade roads and construct and operate smart traffic management centres.”