VIETNAM ECONOMIC FORUM 2024

Mr. NGUYEN DUC LENH, Deputy Director of the State Bank of Vietnam - Ho Chi Minh City Branch:

Mr. NGUYEN DUC LENH

The bank is meeting capital needs effectively.

Large-scale projects and infrastructure works such as transportation, energy and electricity, roads, schools, and hospitals all involve bank credit. This flow of capital has been and continues to be effective, contributing to economic growth and having a positive impact on credit growth.

From a macroeconomic perspective, when public investment projects are implemented, the absorption of capital and the creation of cash flow are of great significance in channeling this cash flow into the market. Given the current credit borrowing needs of contractors and construction units participating in public investment projects, the banking sector is fully capable of meeting them.

Mr. NGUYEN NGOC HOA - Chairman of the Ho Chi Minh City Business Association, Chairman of the Board of Directors of the Ho Chi Minh City State Financial Investment Company:

Mr. NGUYEN NGOC HOA

Public investment projects need to be socialized.

Currently, all public investment projects are implemented by the state or project management boards. There is a situation where there is excess money but disbursement is hampered by mechanisms, procedures, and processes, requiring a comprehensive solution. Agencies and departments need to boldly change their approach in project implementation.

The business community is currently very anxious because they need the rapid disbursement of funds for public investment projects in order to secure work. Businesses are willing to secure funding with their own capital, but they also need support from banks through unsecured working capital financing, secured by the right to recover construction costs.

The An Phu interchange project at the eastern gateway of Ho Chi Minh City commenced construction at the end of 2022 with a total investment of over 3,400 billion VND. Photo: HOANG TRIEU

Mr. NGUYEN NGOC NGHIEM , Director of Corporate Customer Division - Ban Viet Bank (BVBank):

Mr. NGUYEN NGOC NGHIEM

Comprehensive financial solutions

For public investment projects, BVBank provides credit limits based on a comprehensive assessment of the client's plan and cash flow, with financing up to 80% of the construction contract value. BVBank offers a fixed interest rate from 5.5%/year, helping public investment projects easily manage cash flow and minimize interest rate risk. The bank is also willing to accept collateral in the form of claims from construction contracts with financing up to 70%. In addition, it offers a guarantee issuance policy with a margin requirement of 0% and a credit-free ratio of up to 100%...

Mr. LE BACH CUONG , Head of the Southern Investment and Construction Management Sub-Department under the Investment and Construction Management Department - Ministry of Transport :

Mr. LE BACH CUONG

Research on alternative materials

Construction projects in the central and northern regions generally have no shortage of building materials, but the southeastern and southwestern regions are facing some difficulties, especially the Ho Chi Minh City Ring Road 3 project.

To address this issue, the Ministry of Transport has worked with the Ministry of Natural Resources and Environment, proposing to assign targets to localities to prepare material sources for project implementation. It is expected that the sand supply issue in the Southwest region will be resolved by September 2024. The Ministry of Transport, along with other ministries, has also researched and implemented alternative material sources, including a pilot solution using expanded sea sand.

Mr. Cao Minh Nghia , M.Sc., Deputy Head of the Economic Development Research Department - Ho Chi Minh City Institute for Development Research:

MSc. Cao Minh Nghia

Removing obstacles for development investment funds.

There are two solutions to the problem of transportation infrastructure funding: utilizing local development investment funds and establishing a new fund. Utilizing existing funds has the advantage of speed but faces legal hurdles. Establishing a new fund, on the other hand, would make applying new regulations easier but would be much more cumbersome and involve complex procedures.

Resolution 98/2023 of the National Assembly allows Ho Chi Minh City to use local budget funds for key inter-provincial transportation projects, but only for a few projects, without a general formula.

Ms. TRUONG NGUYEN HIEU , Head of the Public Investment Management Department - Department of Planning and Investment of Tay Ninh Province:

Mrs. TRUONG NGUYEN HIEU

In April 2025, the land for the Ho Chi Minh City - Moc Bai expressway will be handed over.

Regarding the Ho Chi Minh City - Moc Bai expressway project, the People's Committee of Tay Ninh province has assigned the Investment and Construction Project Management Board of the Transport Sector as the investor for component project 4, which involves land clearance for the section passing through Tay Ninh.

Tay Ninh province has allocated funds for the project and is preparing the necessary procedures to implement land clearance with a total capital of over 1,500 billion VND. It is expected that by April 30, 2025, Tay Ninh province will hand over all the land to the project.

Journalist - Dr. TO DINH TUAN , Editor-in-Chief of Nguoi Lao Dong Newspaper:

Journalist - Dr. To Dinh Tuan

Refer to best practices from other countries.

According to analyses by experts and investors, there are currently bottlenecks that need to be addressed in the disbursement of public investment. Therefore, the Nguoi Lao Dong newspaper has decided to choose this topic for the third session of the Vietnam Economic Forum 2024.

It's important to recognize that in public investment, the idea of ​​"complaining when there's no money, but not spending when there is" is illogical. The obstacles lie in the mechanisms and methods, which need to be addressed to promote economic development, especially in the context of a global economy and geopolitical situation with external influences. Simultaneously, all resources of society must be mobilized. We can learn from the best practices of other countries and draw lessons suitable to Vietnam's situation.

With the determination and dedication of Ho Chi Minh City's leaders to promote public investment, it is hoped that from now until the end of the year, this sector will develop more strongly, contributing to the country's public investment, thereby creating a ripple effect for a positive shift in the economy.

Source: https://nld.com.vn/dien-dan-kinh-te-viet-nam-2024-phien-thu-ba-thao-diem-nghen-giai-ngan-dau-tu-cong-thay-doi-cach-lam-196240815222055019.htm