How to improve the "quality" of ODA capital flows? (part 3)

07:45, 12/24/2023

Final episode: To make ODA capital truly effective

The effectiveness of capital from official development assistance (ODA) for the economy is undeniable, but how to use this capital to achieve the expected efficiency is a big challenge. Therefore, the orientation of attracting, managing and using ODA capital to improve both "quantity" and "quality" of this capital flow is becoming an urgent issue.

Efforts to accelerate ODA capital disbursement

Identifying the slow disbursement of ODA capital as a major obstacle in the circulation of this capital flow, in 2022, the Provincial People's Committee issued 4 official dispatches on the content of urging to accelerate the implementation and disbursement of ODA projects; strengthening the capacity of project management boards to improve the quality of re-borrowed project proposals and promote public investment disbursement from foreign capital. The province has also established 4 working groups to urge the disbursement of public investment capital, focusing on directing, inspecting, supervising, and promptly handling difficulties in disbursement work in the province. At the same time, urging investors to accelerate the construction progress of works and handle arising difficulties or propose competent authorities to resolve difficulties in the process of project implementation, especially ODA projects.

The working delegation of the Economic - Budget Committee of the Provincial People's Council supervised the actual Border Area Development Support Project - Dak Lak Province Sub-project in Krong Buk district.

In addition, in order to improve the efficiency of capital use as well as speed up the disbursement of ODA capital, the province has also strengthened the inspection and supervision of project implementation. For example, in mid-November 2023, the Economic - Budget Committee of the Provincial People's Council organized a monitoring session on the management and use of foreign loans of Dak Lak province for relevant departments, branches, sectors, and ODA project investors to grasp the situation of capital use as well as difficulties and problems. From there, propose to competent authorities to promptly have solutions to remove them. During this monitoring session, the members of the delegation frankly pointed out the shortcomings and limitations and contributed ideas for investors to find ways to overcome them.

Enhance stakeholder accountability

"Units need to proactively review to report and propose solutions to remove difficulties for programs and projects using foreign capital to increase efficiency and direct capital flows to the right purposes" - Mr. Vo Dai Hue , Head of the Economic - Budget Committee of the Provincial People's Council.

Along with slow capital disbursement, problems with processes and procedures have become objective causes leading to ineffective use of ODA capital. However, when analyzed from a subjective perspective (why is capital disbursement slow? and why are procedures prolonged?), the cause is due to the role and responsibility of investors themselves. For example, in some projects, it takes a long time to wait for the total investment adjustment due to increased site clearance costs. Therefore, the only solution to limit these problems is that investors must have careful preparation and surveys before developing plans, proposals, and implementing procedures to prepare for project investment.

At the thematic conferences on public investment disbursement, the implementation and progress of ODA projects received the attention of many delegates. Thereby, many opinions also said that the competent authorities and project investors must improve the quality of preparation and design work, along with strengthening the role and responsibility of quality supervision by competent authorities through the process of appraisal and approval of documents and design documents of programs and projects. In addition, it is necessary to ensure the scale is appropriate to the capital allocation capacity of the competent authorities and investors, minimizing adjustments and changes during the implementation process to avoid waste and prolong the implementation time of programs and projects. In addition, it is necessary to implement solutions to handle problems of programs and projects that are behind schedule.

People in Ja village (Hoa Son commune, Krong Bong district) received support to renovate their long houses from the funding source of the Border Area Development Support Project - Dak Lak Province Sub-project.

To improve the efficiency of ODA capital use in the coming time, the province has also requested central ministries and branches to support localities from the stage of investment project preparation, negotiation to implementation; organize training courses on management and operation knowledge of foreign-invested projects.

However, according to many economic experts, to improve the "quality" of ODA capital, it is necessary to accelerate the disbursement progress by increasing readiness and proactiveness when implementing projects from this capital source. It is necessary to promote the role and responsibility of the head, review the allocation of ODA capital to projects in accordance with the implementation progress and disbursement capacity, and ensure focus and key points. In particular, with this capital source, it is necessary to identify projects with high feasibility, not scattered, fragmented, or prolonged, leading to slow progress and loss of the meaning of capital flow.

Kha Le

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