Hanoi wants to issue bonds to invest in a large project.

According to the draft resolution submitted to the City Council, Hanoi will be allowed to issue various types of special bonds to raise capital for urban railways, strategic transportation, and major infrastructure projects.

According to the Hanoi People's Committee, the investment capital needs for the period 2026-2035 are very large. Photo: Dinh Ha.

The Hanoi People's Committee is currently seeking public opinion on a draft resolution of the City People's Council regulating the issuance of local government bonds, project bonds, infrastructure bonds, municipal bonds, and green bonds to mobilize resources for investment and development.

According to the draft proposal, this is a special mechanism stipulated in the 2026 Capital City Law, allowing the City People's Council to decide on the issuance of the aforementioned types of bonds to serve programs and projects under the expenditure responsibilities of the local budget.

Hanoi has stated that its investment capital needs for the period 2026-2035 are very large, especially for urban railway systems, ring roads, bridges across the Red River, environmental treatment projects, digital transformation, and smart city development. Meanwhile, relying solely on public investment from the state budget is unlikely to meet the required progress and scale of investment.

According to the drafting agency, the issuance of project bonds, infrastructure bonds, and municipal bonds will allow the city to link mobilized capital to specific projects or groups of projects, thereby enhancing transparency and expanding access to investment funds, financial institutions, and domestic and foreign institutional investors.

According to the Hanoi Department of Finance, issuing bonds is not a new solution. Between 2013 and 2015, the city issued a total of 11,400 billion VND in bonds for the construction of the capital city to supplement funding for infrastructure projects.

The department assessed that the issuance of bonds during this period made a significant contribution to supplementing medium and long-term capital for the budget, helping to accelerate the progress of many transportation, education , health, water supply and drainage, and technical infrastructure projects.

Alongside the bond issuance option, the draft also adds a mechanism for borrowing from credit institutions and from the State budget to increase flexibility in balancing resources.

Regarding borrowing from credit institutions, the draft regulations stipulate that the total annual borrowing amount will be decided by the City People's Council based on the local budget estimates. Based on this, the Department of Finance will advise the City People's Committee on appropriate borrowing plans from domestic financial and credit institutions.

According to the draft, these loans must be denominated in Vietnamese Dong, with a minimum loan term of 3 years or more, and the interest rate must be in line with the general market rate at the time of borrowing.

The City People's Committee or its authorized agency will directly negotiate, finalize procedures, and sign loan agreements with the lending institution.

Regarding loans from the State budget, Hanoi stated that this mechanism helps the city proactively address short-term capital needs and ensure the progress of urgent projects.

According to the draft, borrowing from the state budget must be approved by the National Assembly and the City People's Council within the total annual borrowing limit. Loan applications will be submitted to the Ministry of Finance for consideration based on the availability of temporarily idle funds. Loans from the state budget will be subject to a 0% annual interest rate, but must be repaid on time as stipulated and cannot be extended.

Source: https://znews.vn/ha-noi-muan-phat-hanh-trai-phieu-de-dau-tu-du-an-lon-post1655996.html