HCM City needs $80 billion for development
Updated at Wednesday, 02 May 2018, 15:14
The Hanoitimes - The People’s Committee of Ho Chi Minh City said the city will need VND1,800 trillion (US$80 billion) for investment in 2018-2020 to ensure its growth.
During a recent meeting to discuss about measures to raise resources to fund the city’s development in the next two years, People’s Council chairwoman Nguyen Thi Quyet Tam said that the demand for resources for the city’s development is huge and urgent.
“Members of the People’s Council would like to know what the People’s Committee and other relevant authorities are doing to address the issue, especially when the special financial mechanism for the city has been applied this year,” she said.
Ho Chi Minh City is managing over 10,800 public real estate assets
To have the fund, the city has introduced many solutions such as reforming administrative procedures, creating a favorable and safe legal framework for investors and publicizing the list of projects called for investment.
Le Ngoc Thuy Trang, deputy director of the city’s Finance Department, said that her department is proposing the People’s Committee to speed up the divestment of State capital at enterprises, estimating that the city can collect some VND67 trillion from the source.
Trang also expected that the city will have a significant amount from selling more than 10,800 public real estate assets under the city’s authority.
At the meeting, several legislators raised questions related to the special mechanism, how the city can apply the mechanism to meet the resource need, and officials from relevant departments gave replies.
“The People’s Committee and relevant authorities are trying to review the efficiency of public investment and tweak it to improve it,” Le Thanh Liem, deputy chairman of the city People’s Committee, said.
He revealed that public investment had fallen from 9 per cent of gross capital formation in 2011 to 7 per cent last year.
Gross capital investment refers to all the investments in a particular year in an economy.
“However, the low disbursement ratio at investment projects has stymied a breakthrough. Real estate still accounts for a big proportion while many industries and sectors have been waiting for assistance from the government and have not mobilized their strength to raise capital.”
“We must complete the public-private partnership (PPP) process and improve the investment procedures.”
There is a task force for investment led by the chairman of the People’s Committee, and soon the city plans to set up another for land, he said.
“The city authorities will focus on 21 key projects related to the special financial mechanism, review the working of State offices, auction all public lands and assets and effectively mobilize and use foreign remittances.”
Tam said that city authorities must pay more attention to taxes by adopting solutions to increase tax revenues, adding that tax collection must be done accurately.
She also stressed the importance of administrative reform, saying that administrative reform has greatly affected the development of the city, especially in attracting resources and investments. More transparency is required in State management.
According to Tam, the special financial mechanism for the city, approved recently by the National Assembly, is expected to provide a new development stimulus. But authorities must clearly show how locals will benefit from the mechanism since they only see that the city is allowed to collect more fees and charges.
Voters wonder how it would affect social welfare, efforts to mitigate flooding, pollution and traffic congestion, and education would get from the new mechanism, she said.
The People’s Committee and relevant authorities must strengthen management, improve the efficiency of public investment, sell public assets through bidding to raise more funds for development, Tam said.