Opinions on public investment differed among experts at a conference in Ha Noi on Tuesday, but they generally agreed the law needed to be expanded and clarified.
HA NOI —
The conference, co-organised by the Government Office and the German Agency for International Co-operation (GIZ), heard that investment in State economic sectors was high, accounting for 40 per cent of total investment, Thoi Bao Kinh te Viet Nam (Viet Nam Economic Times) reported.
"The State budget had been used to invest in many economic areas that were not public investment sectors," the conference heard.
They covered fields such as restaurants, hotels, tourism, construction, trade and real estate, which made up 12 per cent of all State investment.
Meanwhile, transportation, power, water supply and sewage, health care, education, and information and communications made up 42 per cent of the States total expenditure.
The remainder of the State budget is disbursed to ministries, cities, provinces and localities.
However, management of public investment capital resources is still unsystematic and ineffective, whereas the investment demand of ministries, cities, provinces and localities is huge. This has accelerated risks in public, Government and overseas debt, according to experts.
Nguyen Dinh Cung, deputy director of the Central Institute for Economic Management (CIEM), said: "There were various opinions about PI. However, it should not be classified by capital resources [State, ODA]. PI should be understood in more general terms. Any investment projects from any capital resources that are implemented by the State is really PI or State investment."
To compose a comprehensive Law on Public Investment, it is necessary to clearly determine the role and function of the State, the Government and localities in key public areas to help boost the socio-economy, while focusing on important projects, the conference heard.
Vu Dinh Anh, an economist, said the State economic sector accounted for a large proportion – 40 per cent – of the whole economy. There are more than 1,300 State-owned enterprises (SOEs), but investment effectiveness in these firms is low, which has negatively affected economic development.
"Companies that operate in competitive markets and non-public sectors will not be granted investment capital from the State budget and they have to mobilise funds from other resources," Cung added.
It should also be pointed out that some districts and communities that should not had been given State capital had still managed to acquire it, he said.
Cung added that lawmakers should pay attention to clarifying rules on withdrawing capital from unnecessary SOE projects.
Meanwhile, GIZ economist Constantin Blome, said it was essential to clarify targets and capital resources when it came to the law. This would help the country deal with the overlap in current regulations. — VNS