Unblocking ODA capital disbursement for infrastructure in southern provinces

Over the past 30 years, ODA capital and foreign preferential loans have contributed to the construction of many important infrastructure projects in Vietnam, especially in the South such as My Thuan Bridge, Can Tho , Ben Luc - Long Thanh Expressway, or Ben Thanh - Suoi Tien metro line. However, disbursement progress is still a major bottleneck. Therefore, Decree 242/2025 of the Government was issued to perfect the legal framework, shorten the process, increase decentralization and unblock capital flows for development investment.

The urban flood control project implemented by the Asian Development Bank (ADB) in collaboration with the Ho Chi Minh City People's Committee is currently in the investment preparation stage. The issuance of Decree 242 has created an immediate impact, by increasing local autonomy, shortening the approval process and simplifying project management.

Mr. Nguyen Ba Hung - Asian Development Bank (ADB) Vietnam Office said: "Along with the simplification of approval, there are also further simplifications in the project management process such as simplifying the project implementation process. These are very positive contents and we see the immediate effects".

Localities assessed that the new regulations in Decree 242 have significantly removed long-standing obstacles. Allowing capital withdrawal in the electronic environment, eliminating the project proposal step, or granting approval authority for small-scale projects... significantly shortens the time and increases the initiative of the implementing agency.

"Removing the regulation on project proposals in the ODA capital preparation procedure will shorten our time by 6 months to 1 year. The project appraisal time will also be shortened. Decentralization to localities to proactively adjust and establish projects will create many conveniences," said Mr. Le Huu Thai - Ho Chi Minh City Traffic Department.

Mr. Tran Quang Son - Deputy Director of the Department of Finance of Dak Lak province said: "The constraints between re-loan capital and re-loan rate have been removed a lot in this Decree. Stronger decentralization for technical support projects, related procedures such as bank selection have been completely proactive for localities".

According to the Ministry of Finance, the focus of Decree 242 is to increase transparency and accountability of the governing body. The Ministry also commits to accompany and provide timely guidance to ensure that ODA capital is used for the right purposes and on schedule.

Ms. Nguyen Thi Dieu Trinh - Deputy Director of the Department of Debt Management and Foreign Economic Relations, Ministry of Finance said: "The Ministry will have hotlines and the Department of Debt Management and Foreign Economic Relations is ready with phone numbers, emails and to conduct conferences to disseminate and enhance financial management capacity for project officers in localities."

In the past 8 months, Vietnam has mobilized nearly 450 million USD in ODA capital and preferential loans, but the disbursement rate has only reached over 15%. In the context of promoting decentralization and perfecting the two-level government model, Decree 242/2025 helps simplify procedures, increase decentralization, and improve capital use efficiency - turning ODA into a real resource for growth and sustainable development.

Source: https://vtv.vn/khoi-thong-giai-ngan-von-oda-cho-ha-tang-cac-tinh-phia-nam-100251007185934958.htm