Pressure to disburse public investment in the transport sector

In the context that some projects are continuing to complete investment procedures, facing difficulties and problems in site clearance compensation, infrastructure relocation, conversion of forest use purposes, procedures for granting construction material mines have not been completely resolved, unfavorable weather conditions at the end of the year, etc. are potential challenges to the target of disbursing 100% of public investment capital in 2024.

Contractor workers constructing a bridge on the North-South Expressway.

To "reach the finish line" of the target of disbursing 100% of the public investment capital plan this year, the Ministry of Transport has requested the investor/Project Management Board to direct contractors to focus on solving and organizing the construction of large-volume items before the rainy season; gather enough materials for foundation and road surface; maintain the construction pace of "3 shifts, 4 teams" to ensure the set plan.

Disbursement sprint

According to the report of the Ministry of Transport, by the end of July 2024, the Ministry had disbursed nearly VND 30,800 billion out of a total of VND 62,604 billion, reaching 49.2% of the assigned public investment capital plan for 2024 and higher than the average disbursement rate of the whole country (31.6%).

With the momentum of accelerating project progress in the final months of the year, along with the addition of more than VND 13,000 billion in domestic budget capital, it is estimated that this year, the Ministry of Transport can disburse about VND 74,680 billion, equal to 119% of the initial capital plan.

To have the disbursement volume, the leaders of the Ministry of Transport regularly inspect the site, directly manage, resolutely and promptly remove difficulties; direct investors, consultants, contractors to mobilize maximum human resources, equipment, financial resources, overtime, and construction shifts to speed up progress; promptly report to the Prime Minister and Government leaders for instructions to remove difficulties, especially in site clearance and construction material sources for projects in the southern provinces.

Units are carrying out the paving of crushed stone on the North-South expressway.

In the context of the pressure on implementation progress and disbursement being very tense, at the meetings on progress and disbursement in recent months, Minister of Transport Nguyen Van Thang has especially emphasized: Any contractor that fails to meet the progress will be warned, reprimanded, even transferred volume, contract terminated, especially in key projects such as the eastern North-South Expressway project.

The Minister also affirmed that project management boards have the ability to speed up the process of additional registration according to demand, and the Ministry's view is not to limit the volume of additional registrations.

The Ministry of Transport has requested investors/Project Management Boards to direct contractors to focus on solving and organizing construction of large-volume items before the rainy season; immediately deploy the gathering of materials for foundation and road surface; direct contractors to promote and maintain the construction pace of "3 shifts, 4 teams" to ensure the set plan. For projects that require loading and treatment of weak soil, Project Management Boards/contractors need to complete before October 2024 to "finish" the project by the end of 2025. Investors direct contractors to arrange enough human resources to carry out internal work (completion documents, acceptance, payment); reform procedures, reduce steps to promptly disburse funds to contractors, etc.

As of early August, site clearance at highway projects is still very messy. Component projects 1 and 2 Bien Hoa-Vung Tau through Dong Nai have only been handed over at 25% and 42% respectively; Ho Chi Minh City Ring Road 3 section through Ho Chi Minh City has reached 40%, through Binh Duong has reached 89%; Tuyen Quang- Ha Giang section through Tuyen Quang has reached nearly 76%; Dong Dang-Tra Linh through Lang Son has only handed over 15%,...

The Ministry of Transport requested localities to promptly complete procedures, hand over all land areas, and relocate technical infrastructure in August for projects scheduled to be completed in 2025. Provinces need to urgently change the purpose of forest use in projects according to regulations. If they encounter difficulties or problems, they should promptly report to the Ministry of Agriculture and Rural Development for guidance.

Regarding the source of sand materials for roadbed construction, according to calculations by the Ministry of Transport, Tien Giang province needs to supply nearly 16 million ^m3. Sand for highway projects, Ben Tre needs nearly 7.4 million ^m3 ,... but up to now, the implementation of procedures has not met the required progress. These two localities are implementing procedures for granting mines but it is unlikely to be completed this August.

The Ministry requested localities to direct departments and branches to promptly complete procedures and put the material mine into operation by the end of August 2024, increase mining capacity, ensure sufficient supply, and meet construction progress.

Strive to disburse 100% of assigned capital

In 2024, the Prime Minister assigned the Ministry of Transport 59,275 billion VND of public investment capital. In addition, the capital source was extended from the 2023 plan to 2024 by about 3,329 billion VND. The Government reported to the National Assembly Standing Committee to add 8,680 billion VND from the increased central budget revenue in 2023 for the ministry and the ministry continued to propose adding 3,300 billion VND for group B projects that are lacking capital, adding about 1,240 billion VND from the increased central budget revenue in 2022 for projects that have completed investment procedures. Thus, the total disbursement plan for 2024 of the Ministry of Transport is expected to be about 75,824 billion VND.

According to reports from investors, it is expected that in 2024, the Ministry of Transport will disburse about VND 74,680 billion, reaching 98.5% of the plan (VND 4,428 billion of ODA capital, VND 70,252 billion of domestic capital).

The leaders of the Department of Planning and Investment assessed that the amount of capital to be disbursed in the last months of the year is still large (45,030 billion VND), in the context that some projects are continuing to complete investment procedures, problems in compensation for site clearance, infrastructure relocation, conversion of forest use purposes, construction material mines in some projects have not been completely resolved, unfavorable weather conditions at the end of the year... will pose challenges to the target of disbursing 100% of public investment capital in 2024.

The source of highway embankment materials is still the "bottleneck" of disbursement in the transport sector.

Therefore, to meet the target of 100% disbursement by 2024, investors need to make greater efforts to disburse all allocated capital. The Department of Planning and Investment will monitor the disbursement situation and promptly report to the Ministry's leaders to flexibly transfer capital from low-disbursement projects to high-disbursement projects. The Ministry's functional units promptly handle problems during the implementation process to speed up the progress of project implementation and disbursement.

The Department of Planning and Investment held a meeting with investors and related units to review the implementation of the 2024 plan and the 2025 plan needs. Investors proposed that the 2025 plan needs of the transport sector are about VND 77,624 billion out of a total of VND 104,513 billion. Although it increased by about VND 5,172 billion compared to before, the unused capital plan for the 2021-2025 period still has VND 26,889 billion.

The Department requested investors to review the ability to disburse the 2024 plan based on the annual plan assigned by the Minister of Transport and the expected adjusted and supplemented plan to disburse 100% of the Ministry's annual capital plan in accordance with the Minister's direction "in 2024, strive to disburse 100% of public investment capital".

With the important meaning and role of public investment disbursement in 2025, the Department of Planning and Investment recommends that investors accurately review the 2025 plan needs on the principle of ensuring sufficient capital to complete and implement projects according to the approved schedule; North-South expressway projects ensure sufficient funding for investment in smart traffic items, non-stop toll collection, vehicle load control and completion in 2025; strive to register the maximum disbursement needs for the remaining 2021-2025 period in the 2025 plan of all capital sources assigned by the Prime Minister and expected to be assigned.

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