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Good investments curb inflation
Better allocation of funds has helped reroute millions of dollars to more effective projects
Investigations of ministries, sectors, localities, and State-owned groups and corporations have showed that great efforts have been made to ensure investment sources are used and allocated effectively, according to a Ministry of Planning and Investment (MPI) report released yesterday.
The reports were made by 11 MPI teams investigating the implementation of the Prime Minister's Decision 390/QD-TTg issued on April 17, which dealt with capital construction investment and 2008's State budget expenses to help curb inflation.
According to MPI statistics, by July 15, nearly 2,000 State budget-funded projects and construction works worth almost VND6 trillion (US$358 million) had been suspended or slowed down.
MPI spokesperson Le Van Hoc said that projects with investment capital from Government bonds had also been carefully investigated.
"Initially a sum of VND10 trillion ($588 million) has been saved from those suspended projects and re-allocated to more effective projects, which will be finished within the year," said Hoc, who is also the director of MPI's Department of Local and Regional Economy.
Investigations showed that 15 State-owned groups and corporations have reduced, stopped or lengthened progress of more than 1,000 projects worth VND29.3 trillion ($1.7 billion).
Hoc said that the money would contribute greatly to curbing inflation.
"All the ministries, sectors, localities, and State-owned groups and corporations that we investigated were aware of the importance of planning for construction investment and budgeting in 2008," Hoc said. "They have made great efforts to actively implement the Prime Minister's decision".
Hoc noted that thanks to the efforts, the total projects using State budget funds in 2008 in localities had decreased from 13,901 to 12,750. The number of new projects had fallen from 3,965 to 3,140.
"As a result, the average capital for a project has increased from VND4.45 billion ($261,000) to VND4.85 billion ($285,000)," he said.
The MPI official urged localities to strictly suspend and slow down projects which were not urgent and to channel capital into projects that could be completed by the end of 2008.
State-owned groups and corporations were advised to continue checking projects and making plans to re-allocate development capital for the last six months of the year.
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