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Low disbursements blamed for growth slowdown

Tu Giang
Friday,  Jun 16,2017,23:29 (GMT+7)
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Low disbursements blamed for growth slowdown

Tu Giang

HANOI – Lower-than-expected disbursements in public investment projects in 2016 and the first five months of this year have led to GDP growth slackening, Deputy Prime Minister Vuong Dinh Hue told a National Assembly (NA) session in Hanoi on June 15.

He said Vietnam disbursed 92.3% of the approved amount, up from 87% in 2015, but the proportion in January-May this year was a mere 24.7%. “We have money but do not know how to use it up. This is one of the reasons behind the country’s lower-than-expected economic growth this year.”

Many ministries and provinces, he noted, have not strictly observed the National Assembly’s Resolution 26, which requires them to give priority to vital and urgent projects, and those carried out in the public-private partnership (PPP) format and with official development assistance (ODA) loans.

Ministries and provinces are inclined to not abandon any of their projects, he added.

Earlier, NA deputy Ta Van Ha of Bac Lieu Province asked about the progress of the medium-term public investment plan for 2016-2020. Minister of Planning and Investment Nguyen Chi Dung replied 88% of the capital had been allocated and the remainder totaling VND198.3 trillion will be done later, with VND85 trillion of it going to projects of national importance.

In regard to debts owed in basic construction projects, Dung said, according to the Law on Public Investment, after 2014, ministries and local authorities would face criminal charges if they cause new debts in basic construction projects.

“We have no data on the debts involving basic construction projects at ministries and local authorities. If a locality causes basic construction debt, it will be responsible for solving it,” he said.

Dung said the debts owed by projects under the national target program for developing new rural areas had amounted to around VND15 trillion by 31 December 2014, according to a Ministry of Agriculture and Rural Development report. To date, the figure has been reduced to some VND9 trillion. The debt is mainly from traffic infrastructure projects.

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