Public Investment

Strong efforts from the city helped avoid disruption to industrial production amid the Covid-19 outbreak.

Manufacturing and processing continue to be key driving forces for the growth, making up 25% of the GDP.

As of June 30, the disbursement rate of public investment remained modest at VND133.9 trillion (US$5.8 billion), lower than the rate recorded in the same period last year of 34%.

Projects lagging behind schedule are those financed by the official development assistance (ODA), preferential loans, foreign direct investment (FDI) and under the public-private partnership (PPP) mechanism.

Due to the city’s budget constraints, it is essential for local authorities to ensure the utmost efficiency in the spending of public money, the Hanoi’s mayor has said.

State fund should be channeled into key projects of national priority, which has high spillover effects and create room for development.

Current priorities should be attached to ensuring effective state budget collection and pushing for speedier disbursement of public investment funds, the city’s mayor has said.

The state fund would first be channeled to major infrastructure projects that serve as a boost for socio-economic development and lay the foundation for the economic growth in the next five-year period.

Public investment, trade and domestic consumption remain key for Vietnam’s economic recovery in 2021.

As the government looks to push for public investment and the central bank keeps a low interest rate environment to aid economic growth, banks are expected to be the first beneficiaries from an economic rebound.