Clearly identify priority areas for the use of ODA funds.

(Baonghean) - The question of which sectors are currently being nourished by ODA and which sectors will continue to receive investment is one of the issues raised after the Ministry of Planning and Investment reported to the National Assembly on the signing and disbursement of ODA and preferential loans from foreign donors during the 2010-2015 period. According to the report, during the 2010-2014 period, over 10 billion USD of ODA was allocated to the transportation sector, accounting for over 37%, while health and social services accounted for only 4.54%, and education and training 3.84%.

Not all funds were disbursed.

The Nghi Thai spillway bridge (Nghi Loc district) was built with ODA funding.

Minister of Planning and Investment Bui Quang Vinh stated that ODA and concessional loans from foreign donors were only available during the 2010-2012 period, totaling nearly US$21.8 billion. Since 2013, when Vietnam became a development partner, no ODA commitments have been made at the annual Vietnam Development Partnership Forum (VDPF). Disbursements are estimated at nearly US$27.2 billion, equivalent to 88.7% of the total ODA and concessional loans.

According to the Ministry of Planning and Investment, the transportation, environment (water supply and drainage, climate change adaptation, etc.), urban development, energy, and industry sectors have a relatively high proportion of ODA and concessional loans. Meanwhile, agriculture and rural development combined with poverty reduction, health, social services, education and training, science and technology, institutional capacity building, etc., account for a rather modest percentage.

There are still many challenges to overcome.

Many transportation infrastructure projects are funded by ODA (Official Development Assistance) sources. (Illustrative image.)

Currently and in the near future, there are many challenges in attracting, managing, and utilizing ODA and concessional loans. Looking ahead to 2020 and beyond, the orientation for using non-refundable ODA, ODA loans, and concessional loans will be to invest in various objectives. Concessional loans will be allocated to key national programs and projects with reliable revenue streams and repayment capabilities, such as the construction of power plants, toll highways, subways, elevated railways in major cities, telecommunications systems, and high-tech manufacturing facilities, etc.

Allocate resources to support the private sector.

According to the Ministry of Planning and Investment, the orientation regarding priority areas for the use of ODA and concessional loans in the coming period shows that a portion of ODA and concessional loans can be used to invest in production development to promote trade, contribute to job creation, and create economic restructuring in regions and localities.

Based on the above principles, the Ministry of Planning and Investment has submitted to the Government a list of priority areas for attracting and utilizing ODA and concessional loans. However, according to many economic experts, the prioritization of these funding sources still has many shortcomings.

Notably, areas considered fundamental and pioneering solutions are often ranked last, such as human resource development, especially high-quality human resources; the development of science and technology and the knowledge economy; agricultural and rural development; environmental protection and natural resource conservation; climate change adaptation and green growth; and support for investment, trade, and certain production and business sectors. Therefore, in implementing this valuable loan, decisive policy decisions closely aligned with reality are even more necessary to ensure that ODA and concessional loans are more effective and bring tangible benefits to the nation and its people.

Red River