Hanoi’s disbursement rate of public funds reaches record high

Given drastic measures from the local government, the estimated disbursed amount of public funds in Hanoi is set to reach over 93% of the year’s estimate for 2020 at VND45 trillion (US$1.95 billion).

The Mai Dich – South Thang Long section of the Ring Road No.3. Photo: Pham Hung.

The figure, while remains lower than the expectation, is the highest  to date.

Considered as one of the key solutions to boost economic recovery during the post-Covid-19 period, Hanoi’s authorities have been pushing for the realization of the public investment target for this year.

Thanks to a timely disbursement process, Hanoi has completed 127 construction projects at city-level in 2020, including those in the transport infrastructure sector, including the Mai Dich – South Thang Long section of the Ring Road No.3, Nguyen Van Huyen overpass, viaducts crossing Linh Dam lake and Truong Chinh street.

To ensure high efficiency in public investment, Hanoi held an online conference to address issues in public investment in the city since late August. Meanwhile, Secretary of the Hanoi Party Committee Vuong Dinh Hue on September 15 requested to set up five task forces specialized in accelerating the disbursement progress of public funds, expecting local agencies to transfer state capital in projects with slow disbursement progress to those with faster disbursement pace.

The Hanoi’s Party chief urged departments, units and districts to step up efforts in accelerating the disbursement progress, in which ensuring efficiency in cooperation between various agencies is necessary to address bottlenecks in the process.

“Leaders of localities are responsible for keeping up the progress of site clearance processes and avoid delay to the execution of public projects,” Mr. Hue noted.

Greater efficiency in utilizing public funds

In 2021, Hanoi drafted 23 criteria for socio-economic development, including an economic expansion target of 7.5% year-on-year.

Right in the first month of the year, the city is set to hold meeting with districts and local agencies to carry out action plans, including a focus on public investment.

For a gross regional domestic product (GRDP) growth of 7.5-8% per year, Hanoi is set to require investment capital of VND3,100 – 3,200 trillion (US$134.3 – 138.7 billion), in which the state capital could make up 30-31%, domestic private capital of 53-54% and foreign capital of 15-17%.

In the coming time, Hanoi plans to issue local government bonds to raise funds for public investment projects, while pushing for the privatization and divestment of state capital at state-owned enterprises. The municipal Department of Finance estimates the city would be able to raise up to VND18 trillion (US$780 million) from such processes.