Urging ODA disbursement

At this meeting, the members of the Steering Committee also admitted that not only did the total value of signed agreements tend to decrease, but ODA disbursement remained slow and there was no breakthrough. The number estimated by the Ministry of Planning and Investment in the first 6 months of the year is 2.564 billion USD in signed ODA and concessional loans and 1.85 billion USD in disbursed capital, about 4% lower than the same period last year.

If the trend of decreasing the value of signed agreements is considered easy to understand, because since 2010, Vietnam has become a middle-income country, then the slow disbursement of ODA and lack of breakthrough is also not difficult to understand. Although there have been many improvements, slow ODA disbursement is a reality that is difficult to deny in recent times. Because of slow disbursement, up to now, there is still nearly 22 billion USD of signed capital that has not been disbursed, of which the majority are investment projects of the group of 6 development banks with preferential loans.

The Prime Minister assigned the Ministry of Finance and the Ministry of Planning and Investment to review disbursement procedures and report to the Standing Government in May 2016.

Slow disbursement, there is a risk that a series of projects using loans from development partners will be canceled, once Vietnam "graduates" from preferential loans with low interest rates. The time to "wean" preferential capital from donors World Bank (WB) and Asian Development Bank (ADB) is approaching.

The available capital cannot be disbursed to serve socio-economic development goals, which is a pity, especially in the current context of a limited budget. This will reduce the efficiency of loan use.

For that reason, at the Government's regular meeting last May, Prime Minister Nguyen Xuan Phuc emphasized "not accepting the situation of having money that cannot be disbursed", including ODA capital and development investment capital in general. Referring to the above figure of 22 billion USD, the Prime Minister assigned the Ministry of Finance and the Ministry of Planning and Investment to review disbursement procedures and report to the Standing Government this month.

At the meeting of the National Steering Committee on ODA and concessional loans, once again, calls were made on how to speed up the disbursement of ODA capital. The cause of delay was pointed out as due to institutional and legal problems; due to adjustments during project implementation; due to differences in procedures between Vietnam and donors; due to counterpart capital not being fully and promptly allocated; due to problems in site clearance... And an extremely important reason is that we do not allow disbursement to exceed the assigned plan according to the Resolution on the 2016 state budget estimate of the National Assembly.

Resolving these difficulties and obstacles is important at the present time. Furthermore, in the context that Vietnam has become a middle-income country, many sources of funding, support capital, and incentives have been cut, it is necessary to pay attention to building an appropriate campaign plan for the transition from ODA loans and concessional loans to loans with less preferential levels, focusing on quality and efficiency of use to ensure sustainable public debt.

And of course, as Deputy Prime Minister Pham Binh Minh emphasized at the meeting of the National Steering Committee on ODA and concessional loans, it is necessary to pay attention and use loan capital more effectively, including continuing to promote disbursement progress, ensuring the implementation progress of projects; Arrange adequate and timely counterpart funds for ODA projects; Carry out site clearance work well; Administrative procedures for project implementation must be reduced, but still ensure efficiency...

Doing so will not only promote quick disbursement of ODA capital but also ensure strict management and effective use of ODA capital and concessional loans, promoting socio-economic development.