The Art of Expediting: A Nudge from the Top to Spur Investment Action

On August 28, Mr. Phan Van Mai, Chairman of the Ho Chi Minh City People’s Committee, signed a document sent to the departments, branches, districts, Thu Duc City, and project management boards regarding the disbursement of public investment capital. The Chairman of the Ho Chi Minh City People’s Committee reminded 11 construction units that their plans for disbursing public investment capital in 2024 have not reached the 95% ratio.

The reprimanded units include: Project Management Board for the Construction of Civil and Industrial Works; Ho Chi Minh City Project Management Board for Transport Works; Project Management Board for Investment and Construction of Agricultural and Rural Development Works; Hi-Tech Agricultural Park Management Board; Hoc Mon District People’s Committee and Districts 1, 3, 5, 6, Tan Binh, and Tan Phu.

Ho Chi Minh City authorities requested that the units review their disbursement plans from now until the end of 2024 and come up with solutions to accelerate the progress of projects to ensure a disbursement rate of over 95% as committed.

The city also asked the relevant units to urgently complete the investment procedures for two projects, Rach Xuyen Tam (Binh Thanh and Go Vap districts) and North Bank of Kenh Doi (District 8), to ensure that compensation for site clearance can be disbursed in 2024.

At the same time, the Chairman of the Ho Chi Minh City People’s Committee requested that the departments, investors, and relevant units enhance their sense of responsibility and promptly resolve difficulties and problems at the project level and the Working Group level. This is to ensure the progress of disbursement of public investment capital in the city in 2024.

Regarding the 60 contents of the proposals that have expired but have not been handled by the units, the city gave the first reminder for 29 contents, the second reminder for 14 contents, the third reminder for 11 contents, and the fourth reminder for 6 contents (4 contents for the Department of Finance, and 1 content each for the Department of Transport and the People’s Committee of District 6).

The Ho Chi Minh City People’s Committee also requested that the managing agencies and investors ensure the capital and disbursement ratio on a weekly and monthly basis, at least according to the reported plan and commitment. At the same time, they should study and implement solutions to accelerate the progress, ensuring the goal of disbursement exceeding the set plan.

According to Rong Viet Securities Company, in the first seven months of 2024, the disbursement of public investment capital reached approximately VND 245,000 billion, equivalent to 31.6% of the plan, a decrease of 13.8% compared to the same period last year. Public investment increased sharply in the first quarter (up 19.7%) but decreased sharply in the second quarter (down 28%) and showed no signs of improvement in July 2024.

Also, according to VDS, at the beginning of the year, this unit expected disbursement for important projects in Ho Chi Minh City and Hanoi, such as Ring Road 3 (Ho Chi Minh City) and Ring Road 4 (Hanoi). However, the disbursement pace for these projects is quite slow, reaching only 13.4-13.5% of the plan in the first six months.

“Currently, issues related to site clearance and filling materials are being expedited. Along with that, the progress of the North-South Expressway Phase 2 project remains positive (completing 46.8% of the plan in the first six months). Therefore, we expect that the disbursement of public investment capital this year may achieve more than 86% of the total plan, with an estimated scale of VND 670,000 billion, a slight increase compared to 2023,” said Rong Viet Securities.