Do you think that the GDP growth rate in the recent period, especially in 2015, reached 6.68% - the highest increase in the past 8 years, partly thanks to increased development investment spending?

It can be said that the GDP growth rate in the period 2011 - 2015 is appropriate, especially in 2015, the GDP growth rate was very impressive. This result is due to many reasons, including the sharp increase in total investment capital for development of the whole society because our country's economy still depends heavily on capital.

Associate Professor-Dr. Tran Hoang Ngan, Member of the National Assembly's Economic Committee

In the entire period 2011 - 2015, total social investment capital reached 5,617,100 billion VND, more than 1.8 times higher than the period 2006 - 2010; The rate of mobilizing social investment capital compared to the average 5-year GDP reached 31.7%.

In particular, in 2015, total social investment capital reached 1,367,200 billion VND, accounting for more than 24.3% of the total investment capital of the whole period and increased by 12% compared to 2014 and equal to 32.6% of GDP, exceeding the set target of 30 - 32% of GDP. It can be said that the sharp increase in total social investment capital is one of the important factors contributing to promoting economic growth.

But everything has its price?

Increased investment, especially investment from state budget capital, government bond capital, preferential credit capital from the State, ODA capital, on the one hand contributes to economic growth, on the other hand puts pressure on overspending and public debt. In 2015, the overspending was 256,000 billion VND, of which 30,000 billion VND had to be increased to meet counterpart capital requirements for projects using ODA capital and concessional loans from foreign sponsors, causing the overspending to reach 6.1%/GDP, public debt equivalent to 62.2% of GDP, government debt 50.3% of GDP (exceeding the ceiling allowed by the National Assembly of 50%. GDP), foreign debt is equivalent to 43.1% of GDP.

In 2014 and 2015, disbursement of counterpart capital in projects using ODA capital was much higher than the estimate, which is one of the reasons why the overspending was higher than the estimate. In your opinion, how will this capital source be handled in the coming period?

To reduce pressure on public debt and overspending, attention must be paid to handling the use of ODA capital. Counterpart capital disbursed for projects using ODA capital has recently increased because we implemented this method of allocating capital. With the allocation method, localities just run projects and capital, because deciding on investment projects is very easy because it is "free money".

Therefore, I strongly agree with the Ministry of Finance's view that from 2016, instead of allocating ODA capital, it will switch to lending. When they no longer receive grants, but turn to loans, localities are forced to choose projects that are urgent, not necessary when deciding to invest. The urgency is that loan capital must prioritize projects with economic-social and national defense-security effectiveness.

When not allocating but switching to lending, the responsibility of local governments in managing and using this capital source will certainly increase. Do you think so?

Of course, when not allocated but turned to lending, if you borrow and pay both capital and interest, the responsibility of the Provincial People's Council in deciding to borrow will be attached, and the responsibility of the Provincial People's Committee in deciding on investment policies as well as investment decisions will be attached. The person making the investment decision must be responsible if the project is not effective, and may even be held criminally responsible if there is serious loss or waste that requires criminal prosecution.

If we have to re-borrow ODA capital, the locality will have to pay both interest and fees, so we will not re-borrow this capital, but issue local government bonds, sir?

Since mid-2017, ODA capital will have to be borrowed at higher interest rates and for shorter periods of time, so I think that, before borrowing, localities will consider interest rates, time, costs and accompanying conditions to calculate whether to choose the optimal option: either re-borrow ODA capital or issue local government bonds. When deciding where to invest, investors must consider which capital source to use, domestic borrowing, foreign borrowing, mobilizing construction bonds, local government bonds or re-borrowing ODA capital.

If loan costs are high, localities will choose investment methods in the forms of public-private partnership (PPP), build-operate-transfer (BOT), build-transfer (BT), build-transfer-operate (BTO), as long as the investment project is most effective when put into operation.