Despite rising 9 per cent last year disbursement remains far too slow, with $21 billion sitting idle.
Disbursement of ODA and preferential loan capital stood at $5.6 billion ($350 million in grant aid and $5.25 billion for lending) in 2014, an increase of 9 per cent compared to 2013, according a report presented to a conference of the National Steering Committee on ODA and six international bank sponsors.
ODA disbursement in 2014 saw remarkable improvements because of the Steering Committee’s solutions to speed up the process, the report pointed out. Major sponsors still see high disbursement, such as JICA ($1.773 billion), the WB ($1.386 billion) and the ADB ($1.058 billion).
Some large-scale projects have contributed to the disbursement process, such as Noi Bai International Airport’s Terminal 2, major infrastructure projects, and water supply projects in the Mekong Delta, among others.
Experts, though, said that the pace of ODA disbursement wasn’t as fast as expected. Moreover, disbursements in sectors and regions have not been equal.
The ODA management agencies of the State, project owners and sponsors have agreed to hold regular meetings to examine the situation and resolve any problems in the disbursement process.
It’s become harder to attract ODA so the first ODA tasks for 2015 and subsequent years will focus on improving disbursement and using ODA efficiently, Deputy Prime Minister Hoang Trung Hai told the conference. He added that undisbursed ODA is quite high, at some $21 billion. If tardy disbursement doesn’t improve, Vietnam will lose substantial sums in opportunity cost every year.
ODA projects can be complex, conducted over a long period and involve many parties, opening up the possibility of corruption, so it is necessary to have good reporting to control waste, Deputy Minister Hai said. He requested related ministries and agencies in the Steering Committee minimize any bad practices and corruption to improve the efficiency of ODA use, given that the funding source seems likely to shrink in the future.
Management agencies at ministries also have the responsibility to report on any faults in ODA projects and whether they are proceeding on schedule. The Ministry of Planning and Investment will prepare particular activities within the 2015 plan.