(VOVworld) – The Law on public investment which was approved by the National Assembly in June will be enforced on January 1st, 2015. The law’s implementation aims to avoid scattered investment and imbalance through which to reduce losses and wastefulness in public investment.
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The NA on June 18 approved the Law on Public Investment with 440 votes of the total 447 deputies
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The highlight of the law on public investment is a shift from annual to 5-year plans. This will ensure that public investment matches the national socio-economic development strategy, balances the macro-level economy, and guarantees publicity and transparency toward reducing negative phenomena in public investment or scattered investment. Phung Quang Hung, Chairman of Vinh Phuc province’s People’s Committee, says the law will help his province efficiently allocate capital resources for public projects. Hung adds:“the Ministry of Planning and Investment has proposed to outline medium-term development plans. The idea will create an important foundation for us in management ranging from appraising a project to making decisions for investment and directing the implementation of the project. It will make it easier for us to examine all state funding and prevent wastefulness in construction while giving responsibility to those in charge of making the investment decision.”
Close coordination between financial planning and investment plans will balance public investment projects (Photo: baothainguyen.org.vn)
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The Ministry of Planning and Investment has worked with the government to direct public investment for medium-term projects. Instructions have been issued to help Ministries, provinces, and industries make their own specific plans. Le Hoang Quan, Mayor of Ho Chi Minh City, says close coordination between financial planning and investment plans will balance public investment projects and eliminate the habitual ‘ask-and-give’ mechanism.Quan explains further: “the instructions will help provinces, especially key economic hubs, coordinate construction and will be useful in key national projects and major infrastructure projects to minimize scattered investment. The point here is the realization of the instructions, which will require determination and unity in direction and management.”
The law on public investment will improve the management and use of state budget for investment in line with the national socio-economic development strategy. Dao Quang Thu, Deputy Minister of Planning and Investment, says:“designing medium- and long-term investment plans will restrict scattered investment because regulations on long-term investment require extremely strict conditions to begin a work. They include a condition for provinces to arrange capital to be able to pay debts. Priorities must be given to projects that can be completed and put into operation. Capital must be arranged for ODA projects to which the state makes a financial contribution.”
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| The face of Da Nang City has recently improved thanks to public investment projects in infrastructure (Photo: VGP/Thanh Chung) |
At a recent conference of the planning and investment sector in Hanoi, Prime Minister Nguyen Tan Dung said that the medium-term investment plan until 2020 is of great importance to the socio-economic development strategy from now until 2020.