|Public investment was regarded as the engine of growth in the context that the COVID-19 pandemic was heavily weighing on socio-economic development. (Photo: laodongthudo.vn)
The Vietnamese Government has identified public investment as the engine for growth to offset the growth gap caused by the COVID-19 pandemic.
GSO Director Nguyen Bich Lam said that boosting public investment would be an efficient solution to lift economic growth, estimating that every increase of one percent in public investment disbursement would push up GDP by 0.06 percentage points.
In recent years, the disbursement rate of public investment were around 92-93% of the plan. If that rate reached 100%. GDP this year would increase by 0.42 percentage points.
Lam said that focus should be placed on handling bottlenecks in land policies and administrative procedures to boost public investment disbursement, especially for key and large-scale projects which would contribute to the economy’s production capacity such as the projects to expand Tan Son Nhat and Noi Bai international airports, the construction of Long Thanh International Airport and the North-South expressway.
GSO statistics showed that the realised investment in the economy was estimated to total VND367.9 trillion (US$415.85 billion), representing an increase of just 2.2% in the first quarter of this year, the lowest rate in the 2016-2020 period.
In comparison, disbursed State capital rose by 13.2%, a relative high rate in the context of the COVID-19 pandemic, reflecting the Government’s determination to boost the disbursement of public investment, the GSO said.
State capital accounts for 30.5% of the total investment in the Vietnamese economy. It was estimated that around VND700 quadrillion in public investment would be disbursed this year.