Social investment of around VND500 trillion to achieve 10 percent growth
Speaking with delegates at the 20th session of the 10th-term Ho Chi Minh City People's Council, Chairman Phan Van Mai of the Ho Chi Minh City People's Committee explained the rationale behind setting a high growth target. He noted that at the regular end-of-year 2023 meeting, delegates expressed concerns about the city's 2024 growth target of 7.5-8 percent, viewing it as highly challenging.
However, the city's stance is to set ambitious goals to drive progress. Upon review, with a projected 2024 growth rate of 7.17 percent, while the target may not be fully met, it is close enough to show the significant efforts made by the political system, the business community, and the people of the city.
"Recently, in the Government's evaluation, the Minister of Planning and Investment mentioned that national growth this year could exceed 7 percent, driven by the growth engines in Hanoi, HCMC, and Hai Phong. The city is proud to have contributed to this overall result," said Chairman Phan Van Mai of the HCMC People's Committee.
Emphasizing the city’s growth target of around 10 percent for 2025, HCMC Chairman acknowledged that this is a major challenge, as achieving such growth in a large economy like HCMC’s is not simple. He pointed out that 1 percent growth in HCMC is equivalent to 1.3 percent in Hanoi, 4.1 percent in Hai Phong, 14.5 percent in Da Nang, and 17.3 percent in Can Tho. Therefore, reaching this target would make a significant contribution to the overall national growth.
Through its experience in governance, HCMC has identified key lessons to apply in the coming time. Specifically, after the mid-year meeting of the HCMC Party Executive Committee, the People's Committee issued a directive to review all goals and tasks, and to propose specific solutions for focus in 2024 and 2025, aiming to achieve the key targets set by the Resolution. Following this, the city issued Directive No.12 to boost growth in 2024 and 2025. The HCMC Chairman confirmed that this directive has already contributed to the city’s growth in 2024.
In the coming time, the city will review the first four months of implementing Directive No.12 to identify key priorities and breakthrough solutions to achieve around 10 percent growth next year. One of the solutions is to ensure total social investment reaches about VND500 trillion. Of that, VND100 trillion (20 percent) will come from the State budget, while the remaining VND400 trillion will need to be mobilized through social investment.
"Resolving and accelerating the delayed projects will make a significant contribution," affirmed the Chairman of the HCMC People's Committee. He also highlighted the key role of the demand stimulus program by HCMC Finance and Investment State-owned Company (HFIC). He suggested that if HFIC contributes 20 percent to joint ventures with commercial banks, investing VND10 trillion, it could leverage the remaining 80 percent from the banks. The immediate priority is to announce and select six projects for implementation by December.
Additionally, the city has created favorable conditions for investment from both domestic businesses and foreign investors. These investment groups are expected to mobilize VND400 trillion, with the remainder coming from consumption, exports, and emerging growth drivers, such as the digital economy and green economy. With these efforts, the city will be better positioned to achieve its 10 percent growth target.
Public investment disbursement expected to reach 81 percent
Regarding public investment disbursement, the HCMC Chairman reported that the city has disbursed 33 percent so far and is focusing efforts to ensure the disbursement exceeds 80 percent by the end of the year. Based on current progress, the city estimates that public investment disbursement will possibly reach 81 percent by the end of the year.
Mr. Phan Van Mai explained that the city has identified the reasons why this year's public investment disbursement was slow and concentrated at the end of the year. One key factor is the preparation required for the mid-term supplement package, which extended into the first half of 2024. Some projects are still in the planning phase and have not been completed. Additionally, changes in legal regulations, particularly the new Land Law effective from August 1, with more favorable policies, have delayed land clearance as the city awaited implementation of the new laws.
However, he also acknowledged internal factors contributing to the delay. These include issues with urban planning, as projects included in the mid-term list were not updated promptly, causing delays in adjusting the plans. Furthermore, administrative procedures across various departments, such as the Department of Planning and Architecture, the Department of Construction, the Department of Transport, the Department of Natural Resources and Environment, the Department of Planning and Investment, and the HCMC People's Committee office, have at times been slow.
Delays were also attributed to the operations of the Standing Committee of the HCMC People's Committee. Despite holding daily and weekly meetings to address challenges and inspect projects, progress was still slow at times.
To address this, the city issued specific directives for project owners and relevant departments to prioritize processing large volumes of documents. Each deputy chairperson of the HCMC People's Committee has been assigned responsibility for projects with significant disbursement budgets, ensuring public investment disbursement exceeds 80 percent by the end of the year.
During the session, the Chairman of the HCMC People's Committee stated that the projected public investment budget for 2025, combining both central and local funds, is VND85 trillion. Adding 20 percent of this year's rollover funds, the 2025 disbursement target will be approximately VND100 trillion. The HCMC Party Executive Committee has tasked the People's Committee with creating a comprehensive public investment disbursement plan, covering not only 2025 but also the 2026–2030 mid-term period. This plan outlines tasks and solutions to accelerate disbursement, ensuring swift progress in 2025 and achieving the mid-term target of VND250 trillion.
Regarding the upcoming administrative restructuring, the Chairman of the HCMC People's Committee emphasized the need to clearly define functions and responsibilities, specify tasks managed internally, by public services, and by the socio-economic sector. He also highlighted the importance of proposing amendments to relevant legal regulations to the central government to ensure practical, efficient, and effective implementation. The city has also initiated a review of regulations to simplify procedures.
“Restructuring is not just about merging departments; it requires reviewing institutional frameworks and strengthening the workforce. This is a significant task that will continue through mid-2025. We welcome input from representatives, experts, and the public,” the HCMC Chairman stated.
