Unlocking Public Investment Capital: A Positive Signal

In 2024, Ho Chi Minh City was allocated an investment capital of over VND 79,200 billion, 1.15 times higher than in 2023 (over VND 68,600 billion). The city aims to achieve a disbursement rate of at least 95% of this total capital. To accomplish this goal, the People’s Committee of Ho Chi Minh City has provided instructions and issued numerous relevant documents since the end of 2023 and the beginning of 2024.

Significant Efforts

Ho Chi Minh City has essentially finished allocating the investment capital for 2024 in detail according to the targets set by the Prime Minister. Simultaneously, the city has issued numerous directive documents to govern and manage the overall public investment in the city.

Mr. Luong Minh Phuc, Director of the Management Board of Traffic Works Construction Projects (Board of Transportation), stated that many projects have been expedited by the Board of Transportation and contractors since the beginning of the year to ensure the disbursement of public investment capital. A notable example is the project to build a road connecting Tran Quoc Hoan and Cong Hoa streets in Tan Binh district, which just opened to traffic the 9th package of the underground tunnel from Hoang Van Thu to Thang Long on August 10th, valued at VND 200 billion.

According to Mr. Phuc, this construction package involved building an underground tunnel in an urban area with complex geological conditions, multiple underground water veins, and heavy traffic flow as it is located in the gateway to Tan Son Nhat International Airport. Ensuring both construction and uninterrupted traffic flow presented immense challenges.

Therefore, the units worked tirelessly day and night, even during holidays, with the spirit of “Overcoming Sun and Rain,” “Three shifts and four teams,” “Work without delay,” and “Turning the impossible into possible,” as directed by the Prime Minister and the Ministry of Transport. As a result, the tunnel was put into use three months ahead of schedule. In addition to directly connecting to Terminal 3, the project also creates a new parallel route, reducing congestion on the existing Cong Hoa and Truong Chinh streets.

Apart from this project, the construction package for Ba Dat Bridge, part of the An Phu intersection project, will be completed by August 30th. This key project aims to reduce traffic pressure on the eastern gateway to the city, improve transportation capacity in the Cat Lai port area, and connect Ho Chi Minh City with the provinces of the Southeast region.

“Located at the eastern gateway with complex traffic, the project required construction while maintaining traffic flow. Therefore, the investor and contractors worked tirelessly, even during holidays, to take advantage of the daytime and nighttime in complex sections. We strive to complete several critical components in 2024,” said Mr. Phuc.

Similarly, the Ho Chi Minh City Belt Road No. 3 project is progressing as the city government, investors, and contractors work together to ensure timely execution. After a period of diligent collaboration with the Mekong Delta provinces to secure sand for the project, the initial result is that three provinces, including Tien Giang, Vinh Long, and Ben Tre, will provide nearly 5 million cubic meters of sand for the project in 2024. Currently, the construction packages are being implemented as planned, and the project’s progress is generally guaranteed.

In Binh Duong, Mr. Pham Trong Nhan, Director of the Department of Planning and Investment, stated that with a sense of urgency and proactiveness, Binh Duong has identified public investment capital disbursement as a key political task. The province prioritizes resources to accomplish this task and focuses on removing obstacles and creating favorable conditions for investment units. Accordingly, the People’s Committee has allocated 100% of the plan funds to the works and projects as prescribed, avoiding the situation of idle capital awaiting projects, which affects capital use efficiency.

At the Component 5 project to build the Belt Road No. 3 passing through Binh Duong province, with the Binh Goi Bridge spanning 1,300 meters, the construction unit has completed more than 45% of the work volume, ensuring progress according to the contract. The construction unit representative stated that the project had disbursed more than VND 245 billion. Specifically, for the public investment capital allocated for 2024, over 60% has been disbursed.

Regarding the Tan Van intersection, also part of the Belt Road No. 3 project, the joint venture contractor registered for a public investment capital disbursement of approximately VND 650 billion for 2024, and VND 408,623 billion has been disbursed so far. The project was launched in late May 2024, and the joint venture contractor has completed the mass piles. However, the main route is currently hindered by several land clearance issues, which the authorities are actively addressing.

Significant Pressure as Well

In reality, despite the efforts and attempts of the Ho Chi Minh City government and the localities in the Southeast region to implement public investment projects in 2024, according to Mr. Phan Van Mai, Chairman of the Ho Chi Minh City People’s Committee, as of August 9th, the city has disbursed just over VND 13,200 billion, achieving 16.7% of the plan. This outcome is lower than the national average for disbursement (32.2%) and the city’s six-month target (30%).

The Director of the Ho Chi Minh City Department of Planning and Investment, Ms. Le Thi Huynh Mai, acknowledged that with the investment capital to be disbursed in 2024 amounting to over VND 79,200 billion, 1.15 times higher than in 2023 and the highest ever, Ho Chi Minh City faces a significant challenge. “Since the beginning of the year, the department has advised the People’s Committee of Ho Chi Minh City to issue directives and manage public investment,” she said.

In Binh Duong, according to reports, in the first six months of 2024, the disbursement value of the province’s public investment capital plan reached over VND 4,190 billion, equivalent to 28% of the plan capital assigned by the Prime Minister and over 19% of the plan capital assigned by the Provincial People’s Council. Notably, the disbursement value of key projects reached only 16% of the plan, equivalent to VND 2,819 billion, lower than the provincial average. The disbursement rate of public investment capital in Binh Duong has not met expectations, and a large amount of capital remains to be disbursed, mainly in key projects. Currently, the 2024 disbursement rate is lower than that of 2023.

Similarly, in 2024, the total public investment capital in Dong Nai province is over VND 19,300 billion (including capital extended from 2023 to 2024). However, according to the Dong Nai Provincial Planning and Investment Department, by the end of June 2024, the disbursement of central budget capital reached only VND 340.09 billion, or 13.55% of the plan. The disbursement of local budget capital, with a plan of VND 12,664.119 billion, reached only VND 2,584.187 billion, or 20.41% of the plan.

Mr. Vo Tan Duc, Acting Chairman of the Provincial People’s Committee, assessed that the progress of disbursement of public investment capital and site clearance for projects in the province is slow and has not met expectations. “At the beginning of the year, the units committed to disburse 50% of the capital plan by the end of June. However, by the end of July, the province had disbursed just over VND 5,400 billion, or over 28% of the capital plan,” said Mr. Vo Tan Duc at the socio-economic meeting earlier this August.

According to the Ministry of Finance, difficulties and obstacles affecting the disbursement of public investment capital, as reflected by localities, are mainly related to land, planning, and bidding policies. The Ministry of Finance also emphasized that many ministries, sectors, and localities have not allocated details for projects, so disbursement cannot be made. Additionally, there are obstacles in key transport projects regarding site clearance, material supply, and procedures for investment completion and capital disbursement in ODA projects.

Emphasizing that public investment is an essential driver of growth, Dr. Nguyen Bich Lam, former General Director of the General Statistics Office, suggested promptly addressing bottlenecks in site clearance to avoid project delays. He recommended prioritizing the allocation of sufficient capital for compensation and site clearance for areas that meet the conditions. Along with this, it is necessary to remove difficulties related to licensing, mining, and supplying stone, sand, and soil for projects.

(To be continued)