9 priority areas to access ODA capital and preferential loans

The Government has just issued Decree No. 38/2013/ND-CP dated April 23 on the management and use of official development assistance (ODA) and preferential loans from donors. The Decree takes effect from June 6, 2013.

Building a synchronous, large-scale and modern economic infrastructure system
is one of the 9 priority areas for ODA and preferential loans.
Photo: tuyengiao.vn

Accordingly, official development assistance and preferential loans from donors include: ODA includes non-refundable ODA (not to be repaid to the donor) and ODA loans (to be repaid to the donor with preferential conditions on interest rates, grace periods and repayment periods). Preferential loans are a form of loan provision with more preferential conditions than commercial loans.

Regarding the basic principles in the management and use of ODA capital and preferential loans, the Decree emphasizes that this is a source of capital from the state budget used to implement the country's priority socio-economic development goals; the Government unifies state management of ODA and preferential loans on the basis of decentralization associated with the responsibilities, powers, management capacity and initiative of sectors and levels; the attraction, management and use of ODA and preferential loans must be considered, balanced and selected in the overall sources of development investment capital to achieve the highest socio-economic efficiency; ensure publicity, transparency and accountability in the provision of ODA and preferential loans in the use of this capital source; create favorable conditions for the private sector to access ODA capital and preferential loans...

Also according to the Decree, 9 priority areas for using ODA and preferential loans include:

1. Building a synchronous, large-scale and modern economic infrastructure system, including transport infrastructure (roads, railways, airports, seaports and inland waterways); urban infrastructure (urban transport, water supply and drainage and urban environmental sanitation, urban power supply infrastructure); information technology and communication infrastructure; energy infrastructure (prioritizing the development of renewable energy and new energy); irrigation and dyke infrastructure.

2. Developing social infrastructure, including culture, health care, education and training, vocational training, social security, poverty reduction, population and development.

3. Developing high science and technology, source technology and developing science and technology in a number of priority and key areas, knowledge economy and high-quality human resources.

4. Agricultural and rural development, including restructuring and development of agricultural economy, rural socio-economic infrastructure, and new rural construction.

5. Strengthening institutional capacity and administrative reform.

6. Protecting the environment and natural resources, preventing and mitigating natural disaster risks, responding to climate change, sustainable development and green growth.

7. Support the promotion of trade, investment, finance, banking, tourism and a number of production and business sectors to enhance the competitiveness of the economy.

8. Support the implementation of national target programs.

9. Some other priority areas as decided by the Prime Minister.

The Government facilitates the private sector to access ODA capital with the following conditions: The private sector must have the capacity to organize and manage the implementation of the program or project, and the project owner must be confirmed by the program or project management agency or the re-lending agency.

In the case of re-borrowing ODA capital and preferential loans, the financial plan of the program, project and the financial capacity of the project owner must be appraised in accordance with current legal regulations and guidance of the Ministry of Finance.

The private sector can access ODA capital and preferential loans through the following forms: Borrowing capital from the system of domestic financial and credit institutions through credit limit programs and projects or credit components funded by ODA capital and preferential loans to carry out activities in accordance with international treaties on these capital sources and comply with the lending procedures of financial and credit institutions.

Participate in implementing programs and projects in priority areas using ODA capital and preferential loans from the Government in the form of state budget re-lending.

Participate in implementing programs and projects in the form of public-private partnerships, in which the Government contributes ODA capital and preferential loans.

Participate in implementing programs and projects with the goal of supporting the private sector of the program and project management agency./.

According to (CPV) – LT