HCM City is seeking approval for an additional $5.13 billion USD of public investment from the central government and the disbursement of previously approved public investment ito speed up the progress of major public projects.

The authorities of Ho Chi Minh City have decided to suspend investment in the Thu Thiem opera house project worth nearly VND2,000 billion (US$83.3 million) in order to have capital for other projects and the post-pandemic economic recovery program.

Prime Minister Pham Minh Chinh has tasked six working groups to inspect disbursement of public investment capital in 41 ministries, state agencies and 18 localities where disbursement is below the national average rate of 34.47 percent as of July 31.

“Someone told me they had a feeling that the CPI is not correct. I asked them on what grounds. Scientifically, that cannot be proven,” said economist Vo Tri Thanh.

There are many reasons behind slow disbursement. One is building material price increases, which have caused contractors to reduce project activity.

The disbursement rate for public investment capital in HCM City had reached only 26 percent as of the end of July. About 100 projects had a disbursement rate of zero.

Public land and assets valued at multi-trillions of dong have not been fully utilized and many land plots have been left deserted for years. Still, localities continue to complain about the lack of capital.

The initial six months of the year saw public investment disbursement only met 27.86% of the annual plan, a figure even lower than the 29.02% recorded in the same period last year, according to the Ministry of Planning and Investment (MPI).

The disbursement of public investment projects in H1 reached VND192, 200 billion (US$8.2 billion), up 10.1 percent compared to the same period last year. However, this rate is not as expected, Minister of Planning and Investment Nguyen Chi Dung said.

The Resolution 54 on a special mechanism for HCM City expires at the end of 2022, but there has been no draft of a new resolution.

Prime Minister Pham Minh Chinh earlier this month signed a decision on setting up six task forces headed by four Deputy Prime Ministers and two Ministers.

The Vietnamese Government will implement solutions to ensure the efficient management and use of the funds.

It is estimated that until May 31, Vietnam disbursed only 22.37 percent of its public investment budget.

The Ministry of Finance recently reported to the Prime Minister on the disbursement of ODA and concessional foreign loans in 2021.

The Ministry of Finance (MOF) has submitted a statement to the Prime Minister about the public debt management program for 2022-2024, and the plan to borrow and pay public debts in 2022.

In 2022, the driving force for Vietnam’s economic growth will still be import and export, attracting foreign direct investment (FDI) and public investment. Among these factors, public investment is the most important.

With the economy gradually bouncing back, Vietnam will continue speeding up the disbursement of public investment this year, with a focus placed on infrastructure development in order to spur on economic growth this year and beyond.

Numerous projects and investors will be cut off from public investment allocation due to the poor performance of disbursement this year, and this will affect socioeconomic development of localities involved.

Accelerating disbursement of public investment and furthering the support of struggling businesses and individuals to recover from existing difficulties will be key momentum for achieving higher economic growth.

Construction on a section of the Ring Road No. 2 project in HCMC has been delayed for two years, leaving the city with an interest sum of VND232 billion during the period, Lao Dong reported.