Decision No. 1489/QD-TTg dated November 6, 2018 of the Prime Minister on approving the orientation for attraction, management and use of official development assistance and concessional loans of foreign donors in the 2018-2020 period, with a vision for the 2021-2025 period

THE PRIME MINISTER

Decision No. 1489/QD-TTg dated November 6, 2018 of the Prime Minister on approving the orientation for attraction, management and use of official development assistance and concessional loans of foreign donors in the 2018-2020 period, with a vision for the 2021-2025 period^[1]

THE PRIME MINISTER

Pursuant to the June 19, 2015 Law on Organization of the Government;

Pursuant to the June 18, 2014 Law on Public Investment;

Pursuant to the November 23, 2017 Law on Public Debt Management;

Pursuant to the Government’s Decree No. 16/2016/ND-CP of March 16, 2016, on management and use of official development assistance (ODA) and concessional loans of foreign donors;

Pursuant to the Government’s Decree No. 132/2018/ND-CP of October 1, 2018, amending and supplementing a number of articles of Decree No. 16/2016/ND-CP of March 16, 2016, on management and use of official development assistance (ODA) and concessional loans of foreign donors;

At the proposal of the Minister of Planning and Investment,

DECIDES:

Article 1. To approve the orientation for attraction, management and use of official development assistance (ODA) and concessional loans of foreign donors in the 2018-2020 period, with a vision for the 2021-2025 period, with the following principal contents:

I. FOR THE 2018-2020 PERIOD

1. General viewpoints and principles

- To focus on solving problems and stepping up the disbursement and effective use of signed loans.

- To continue to select and prepare potential public investment projects (based on their socio-economic and financial efficiency), which will be disbursed after 2020, to ensure the continuity of and avoid a sudden decrease in development investment funds in the period after 2020. However, it is necessary to select potential and effective projects for sustainable socio-economic development while keeping the budget deficit and public debt safety indicators within the limits set by the National Assembly.

- To use loans for key fields and really important works which have spillover effects and inter-regional impacts as motivation for the development of regions and areas. To appraise and evaluate projects in a strict, objective and transparent manner in order to raise the use efficiency of foreign loans.

- To take advantage of the remaining ODA loans of multilateral donors in the 2018-2020 period. To continue to mobilize and use concessional loans from the International Bank for Reconstruction and Development (IBRD) of the World Bank (WB), ordinary capital resources (OCR) of the Asian Development Bank (ADB) and concessional loans of donors for infrastructure development. The mobilization and use of these concessional loans shall be considered based on public investment sources, loan limits and the state budget’s debt payment capacity; the impacts of these loans in the period after the 2021-2025 period should be considered and evaluated in order to gradually reduce budget overspending and public debts and restructure public investment according to Resolutions of the Party Central Committee and  National Assembly and the debt payment capacity of the state budget at all levels.

- To use foreign loans only for fields/projects for which the domestic public investment fund is unavailable and in which the private sector makes no investment because they are unable to generate profits or for special fields in which the State needs to invest in order to control and manage prices, facilitating the development of other economic sectors, such as commercial operation of river ports and seaports. To encourage the private sector to join hands with the State to invest in infrastructure facilities which have bottlenecks.

- To develop mechanisms for enterprises to access loans from the WB and ADB and concessional loans from other donors without the Government’s guarantee to implement programs and projects on renewable energy and climate change response.

- To use ODA and concessional loans only for development investment, but not for regular spending.

2. Principles of use of fund sources