Accelerate the disbursement of ODA funds.

Although Vietnam is already a developing country, and the amount of official development assistance (ODA) provided by development partners is no longer substantial, given the limited domestic resources and the government's desire to accelerate the disbursement of public investment to boost economic growth, it is necessary to quickly implement ODA funds.

In fact, in recent years, ODA disbursement has been low. Even the cases where ministries, departments, and localities request to return funds because they cannot disburse them all often stem from difficulties in utilizing ODA funds.

Statistics from the Ministry of Planning and Investment show that the total ODA and concessional loans signed by Vietnam for the 2021-2023 period reached approximately US$3.35 billion. In fact, this is still a significant resource; if implemented, it will make a crucial contribution to boosting economic growth and creating a foundation for growth and development in the subsequent period.

However, in reality, the disbursement of ODA funds is always slow. For example, out of the total public investment plan from foreign capital approved by the National Assembly for 2023, which was 29,000 billion VND, the disbursement rate only reached 50.9% of the allocated plan.

In 2022, the disbursement rate was even lower, reaching just over 26%. In 2024, the foreign capital plan is 20,000 billion VND, but the estimated disbursement rate as of February 29th was only 1.42%.

Slow disbursement of ODA funds not only affects overall progress but also wastes a crucial resource, while interest payments still have to be made, resulting in low capital utilization efficiency. Furthermore, it can lead to consequences such as donor withdrawal of funds, project cost overruns, and difficulties in further implementation.

There are many reasons why ODA disbursement is slow. These include obstacles in negotiating and signing loan agreements; differences in policies, processes, and procedures between Vietnam and donors; and inadequate quality and timeliness in investment preparation, project design, and procedural implementation. Other issues include planning and allocation of plans; bidding procedures; land acquisition and counterpart funding; and procedural obstacles related to disbursement and settlement.

In particular, the issue of differences in procedures between Vietnam and its donors has been discussed extensively and for a long time. However, to date, the situation remains unresolved despite the Ministry of Planning and Investment's strenuous efforts in regular exchanges with development partners, especially the group of six banks with the largest ODA funding for Vietnam, in order to resolve difficulties and obstacles.

To accelerate the disbursement of ODA funds, at a recent meeting of the National Steering Committee on ODA, Deputy Prime Minister Tran Luu Quang directed that procedures be harmonized to ensure a "win-win" situation for both sides, shortening the time for project preparation and implementation. Development partners and the group of six banks also agreed with this proposal.

However, while a common set of procedures cannot be established anytime soon and fundamental adjustments to legal regulations are needed, Vietnam and donors still need to cooperate more closely to resolve obstacles and difficulties in each project, as each donor has different regulations. Along with that, it is certainly necessary to continue resolving issues related to land clearance, bidding, disbursement procedures, and settlement, just like other public investment projects in general.

The economy is facing numerous challenges. The impetus for growth in public investment disbursement, including ODA funds, needs to be significantly boosted. This is a crucial imperative for the economy!

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