Thursday, December 14 2017

VietNamNews

ODA money is not for granted

Update: September, 18/2017 - 09:00

Bùi Đức Thụ, deputy director of the National Assembly Deputies Affairs Committee speaks to Tuổi Trẻ (Youth) newspaper about the Ministry of Planning and Investment’s role in tracking on the use of the overseas development aid.

Does the Ministry of Planning and Investment have to seek the National Assembly’s approval before it can approve extra funds for major projects?

That rule is regulated in the law and is written in the 2013 Constitution. For example, the Metro project No 1 in HCM City is a major project with funding from Official Development Assistance (ODA). If the project’s total ODA surpassed the quotation, it has to report to the NA Standing Committee and ask for approval for additional funding.

According to HCM City People’s Committee, a funding adjustment for the project was approved by the Prime Minister and Government agencies in 2011. However, the money has still not been disbursed. Who is responsible for this?

The mid-term public investment plan was approved by the National Assembly. The investment plan has two components – from the State budget and from the ODA. So, if either the NA or the Government requires the project management board to submit a report on the project’s funding adjustment, the Ministry of Planning and Investment has to do it.

In the case of the funding adjustment being approved, the project management board has to disburse the money according to the project’s progress. However, in the case, the budget has already been approved, but the donor couldn’t get the money ready for disbursement then the Government has to write a letter to the donor and ask them to honour their commitment.

All investment projects requiring reports to the NA, the Government – specifically the Ministry of Planning and Investment, have to write such reports and then submit to the NA.

Many projects have faced the problem of delayed fund disbursement even if the money is deposited in the banks. What do you think about this?

The problem lies within the disbursement. For example, in 2016 the PM many times voiced the Government’s commitment to become a government of action, but capital disbursement was only 97 per cent while that of the Government bonds was only 67 per cent.

In the first five months of 2017, capital disbursement was only 19 per cent. Meanwhile it is reported that the sum of money deposited in the State Banks is very big – almost VNĐ200 trillion (US$8.8 billion). This is very abnormal! Việt Nam has to borrow money from foreign countries and pay for interest. The delay in disbursement will harm the country’s growth rate and the country’s employment rate. In addition, delays to putting projects into commission has hurt the country’s economic efficiency.

So what should we do to speed up the disbursement for the Metro No 1 in HCM City and other projects?

If any project funding plans have been approved by authorities, we should just follow the plans. However, during the project implementation if any problem arises we have to look at it carefully and find ways to solve it. In some cases, we have to seek advice from NA or the Government.

For the case of the HCM City’s Metro No 1 or any other project, what we have to think carefully about is effectiveness and debt repayment. For the case of the HCM City’s Metro No 1, if the project management board asks to double or even triple the funding, we should review the project carefully to determine the causes leading to such high cost – both objective and subjective reasons. One thing we have to bear in mind is that the ODA loan is also national debt. We have to take the money from tax funds to pay that debt when it is due. — VNS

 

 

 

 

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