HCM City - Trung Luong Expressway runs through Tan An, Long An province (Photo: VNA) Hanoi (VNS/VNA) - The building material sector would be among the firstto benefit from the Government’s efforts to speed up disbursement of publicinvestment, which was identified as a growth driver as the COVID-19 pandemiccast a shadow on the economy.
According to analysts of VNDirect Securities, major growth drivers were slowingdown. Specifically, exports were under pressure as global demand dropped andFDI also saw significant decline in registered capital (down by 20.9 percent to8.6 billion USD in the first quarter).
“COVID-19 entirely changed the macro-economic landscape. We believe that publicinvestment will play a very important role in accelerating economic growth thisyear as other drivers slow down,” VNDirect Securities wrote.
VNDirect forecast Vietnam’s gross domestic product (GDP) to expand at five percentthis year.
VNDirect said that the Government was sending strong signals about acceleratingpublic investment disbursement this year.
Disbursement of public investment rose by 16.4 percent to reach 59.5 trillion VNDin the first quarter, or 13.2 percent of the plan for the full year.
In the 2021-22 period, the Government would increase public investment by 8.2 percent,higher than the Government’s GDP growth target set at 6.1 percent for 2020.
Budget deficit would be allowed to increase to 3.5 percent of GDP in 2021-22,from the planned rate of 3.4 percent of GDP in 2020.
According to a report by the Ministry of Finance, public investment was plannedat 700 trillion VND this year, 2.2 times higher than the realised capital in2019.
It was estimated that if all budgeted public investment was disbursed thisyear, GDP this year would increase by 0.42 percentage points. Public investmentwould focus on improving infrastructure.
According to VNDirect, component projects of the North-South Expressway wouldbe the focus of public investment. Earlier this month, Prime Minister NguyenXuan Phuc agreed to change the investment model of eight projects of theNorth-South Expressway from public-private partnership to State-invested.
Thus, all 11 component projects of the North-South Expressway would beState-invested.
The Prime Minister also urged localities to focus on speeding up land clearancefor these projects so that construction of some could be started in the thirdquarter of this year, instead of the first quarter of 2021.
Enterprises which produced and supplied building materials would benefit fromthe speeding up of public investment disbursement, VNDirect said.
VNDirect estimated that around 40 percent of public investment would be spentin 11 component project of the North-South Expressway and My Thuan – Can ThoHighway.
Accordingly, the construction would need asphalt worth around 8.9 trillion VND,construction steel worth 7.6 trillion VND and cement worth 3.8 trillion VND.Demand for construction stone would also increase to around 30-35 percent ofthe capacity of producers./.
According to analysts of VNDirect Securities, major growth drivers were slowingdown. Specifically, exports were under pressure as global demand dropped andFDI also saw significant decline in registered capital (down by 20.9 percent to8.6 billion USD in the first quarter).
“COVID-19 entirely changed the macro-economic landscape. We believe that publicinvestment will play a very important role in accelerating economic growth thisyear as other drivers slow down,” VNDirect Securities wrote.
VNDirect forecast Vietnam’s gross domestic product (GDP) to expand at five percentthis year.
VNDirect said that the Government was sending strong signals about acceleratingpublic investment disbursement this year.
Disbursement of public investment rose by 16.4 percent to reach 59.5 trillion VNDin the first quarter, or 13.2 percent of the plan for the full year.
In the 2021-22 period, the Government would increase public investment by 8.2 percent,higher than the Government’s GDP growth target set at 6.1 percent for 2020.
Budget deficit would be allowed to increase to 3.5 percent of GDP in 2021-22,from the planned rate of 3.4 percent of GDP in 2020.
According to a report by the Ministry of Finance, public investment was plannedat 700 trillion VND this year, 2.2 times higher than the realised capital in2019.
It was estimated that if all budgeted public investment was disbursed thisyear, GDP this year would increase by 0.42 percentage points. Public investmentwould focus on improving infrastructure.
According to VNDirect, component projects of the North-South Expressway wouldbe the focus of public investment. Earlier this month, Prime Minister NguyenXuan Phuc agreed to change the investment model of eight projects of theNorth-South Expressway from public-private partnership to State-invested.
Thus, all 11 component projects of the North-South Expressway would beState-invested.
The Prime Minister also urged localities to focus on speeding up land clearancefor these projects so that construction of some could be started in the thirdquarter of this year, instead of the first quarter of 2021.
Enterprises which produced and supplied building materials would benefit fromthe speeding up of public investment disbursement, VNDirect said.
VNDirect estimated that around 40 percent of public investment would be spentin 11 component project of the North-South Expressway and My Thuan – Can ThoHighway.
Accordingly, the construction would need asphalt worth around 8.9 trillion VND,construction steel worth 7.6 trillion VND and cement worth 3.8 trillion VND.Demand for construction stone would also increase to around 30-35 percent ofthe capacity of producers./.
VNA
