Decision No. 40/2015/QD-TTg Issuing Principles, Criteria, and Allocation Standards for Development Investment Funds from State Budget for the 2016-2020 Period

Pursuant to …;

Issuing principles, criteria, and allocation standards for state budget investment capital development phase 2016-2020

Law on Public Investment No. 49/2014/QH13;

__________________ 

On the basis of Law on Government Organization dated December 25, 2001;

On the basis of Pursuant to the State Budget Law No. 01/2002/QH11 and Decree No. 60/2003/NĐ-CP dated June 6, 2003 of the Government detailing and guiding the implementation of the State Budget Law;

Pursuant to the amended State Budget Law No. 83/2015/QH13;

On the basis of Pursuant to Resolution No. 1023/NQ-UBTVQH13 dated August 28, 2015 of the Standing Committee of the National Assembly issuing principles, criteria, and allocation standards for state budget investment capital development phase 2016-2020;

Considering the proposal of the Minister of Planning and Investment,

The Prime Minister issues this Decision on principles, criteria, and allocation standards for state budget investment capital development phase 2016-2020.

Attached herewith are the principles, criteria, and allocation standards for state budget investment capital development phase 2016-2020.

Article 1. Scope and subjects of application

Article 2. 1. Principles, criteria, and allocation standards for state budget investment capital development phase 2016-2020 serve as the basis for planning medium-term and annual investment plans from the state budget for the period 2016-2020 at the national level, at all levels, and in all sectors and units using state budget funds. They also serve as the basis for managing, supervising, inspecting, and auditing the implementation of medium-term and annual investment plans.

a. Ministries, ministerial-level agencies, government agencies, other central agencies, provinces, centrally-administered cities, and units using state budget funds (hereinafter referred to as ministries, central sectors, and localities);

第二条 组织和实施奖励工作的支出水平，如政府第152/2025/NĐ-CP号决定关于分级授权和奖励领域的分权规定

b. Agencies, organizations, and individuals participating in or related to the preparation of medium-term and annual investment plans from the state budget for the period 2016-2020.

1. Ministry of Planning and Investment:

Article 3. Implementation Organization

a. Take the lead and coordinate with the Ministry of Finance to determine the total investment capital for development from the state budget for the medium term and annually during the period 2016-2020;

b. Take the lead and coordinate with the Ministry of Finance, ministries, central sectors, and localities to develop allocation plans for investment capital for development from the state budget during the period 2016-2020 for ministries, central sectors, and localities in accordance with the principles, criteria, and standards set forth in this Decision;

c. Guide ministries, central sectors, and localities to develop allocation plans for investment capital for development from the state budget for the medium term and annually during the period 2016-2020 for ministries, central sectors, and localities in accordance with the principles, criteria, and standards set forth in this Decision.

2. Ministry of Finance:

a. Coordinate with the Ministry of Planning and Investment to balance investment capital for development from the state budget for the medium term and annually to implement the principles, criteria, and standards set forth in this Decision;

b. Take the lead and coordinate with the Ministry of Planning and Investment to determine the ratio of revenue transferred to the central budget and the amount supplemented in the local budget balance for localities during the period 2017-2020;

c. Provide the Ministry of Planning and Investment with information and data on state budget revenues and expenditures nationwide and in each province and centrally-administered city to serve the development of principles, criteria, and standards for allocating investment capital for development from the state budget.

3. Ministries, ministerial-level agencies, government agencies, and other central agencies:

a. Prepare medium-term and annual investment plans from the state budget for the period 2016-2020 in accordance with the principles, criteria, and standards set forth in this Decision;

b. Be responsible before the Prime Minister and inspection, auditing, and verification agencies for the accuracy of information, data, and allocated capital amounts for projects in the medium-term and annual investment plans from the state budget managed by ministries and central sectors;

c. Provide the Ministry of Planning and Investment with information and data within their respective fields of responsibility to serve the development of principles, criteria, and standards for allocating investment capital for development from the state budget.

4. People's Committees of provinces and centrally-administered cities:

a. Based on the principles, criteria, and allocation standards for investment capital for development attached to this Decision, financial capacity, and specific conditions of the locality, develop principles, criteria, and standards for allocating investment capital for development from the state budget for sectors and levels of the locality to be reported to the Provincial People's Council for decision;

b. Prepare medium-term and annual investment plans from the state budget for the period 2016-2020 in accordance with the principles, criteria, and standards set forth in this Decision;

c. Be responsible before the Prime Minister and inspection, auditing, and verification agencies for the accuracy of information, data, and allocated capital amounts for projects in the medium-term and annual investment plans from the state budget managed by provincial and centrally-administered city governments.

This Decision takes effect from the date of signature and applies to the fiscal years of the period 2016-2020.

Article 4. Effective date

1. The Minister of Planning and Investment shall take the lead in guiding, monitoring, and urging ministries, central sectors, and localities to implement this Decision.

Article 5. Responsibilities for Implementation

2. Ministers, heads of ministerial-level agencies, heads of government agencies, and other central agencies, Chairmen of People's Committees of provinces and centrally-administered cities, and heads of agencies and units using state budget funds during the period 2016-2020 are responsible for implementing this Decision.

General Secretary,

REGULATIONS

PRINCIPLES, CRITERIA AND STANDARDS FOR ALLOCATING CAPITAL FOR DEVELOPMENT FROM THE STATE BUDGET FOR THE 2016-2020 PERIOD
(Pursuant to Decision No.40/2015/QĐ-TTg dated14 the 9 January 2015 of the Prime Minister)

 I. SECTORS AND AREAS USING CAPITAL FOR DEVELOPMENT FROM THE STATE BUDGET FOR THE 2016-2020 PERIOD

Capital for development from the state budget shall be allocated to prepare and implement infrastructure projects in economic and social sectors that cannot generate revenue or be directly or indirectly socialized as follows:

1. Agriculture, Forestry, Water Resources and Aquaculture: Projects on water resources, infrastructure for agricultural and forestry development, sustainable forest development, aquaculture development, breeding of crop and livestock varieties, projects on disaster prevention and mitigation, typhoons, floods, and droughts.

2. Industry: Projects in the oil and gas sector funded from oil and gas revenues shared with the host country (if applicable) and retained documentation fees for the Vietnam Oil and Gas Group; infrastructure for coastal economic zones, border economic zones, industrial parks, and clusters; rural, mountainous, and island power grids; power grids serving national defense and security; production of renewable energy.

3. Trade: Projects on people's markets, wholesale markets, logistics centers, exhibition centers, export and import infrastructure in areas with difficult socio-economic conditions and extremely difficult socio-economic conditions.

4. Transport: Infrastructure projects for roads, railways, inland waterways, seaports, and airports.

5. Water Supply, Drainage and Waste Management: Projects on water supply, drainage, and waste treatment.

6. Warehousing: Projects on specialized warehouses, storage facilities for national reserves, archives, evidence storage.

7. Culture: Projects on construction, restoration, and conservation of world cultural heritage sites, special national relics, national relics; preservation of traditional culture, cultural projects.

8. Sports: Infrastructure projects for sports and physical education.

9. Tourism: Technical infrastructure projects aimed at sustainable tourism development in tourist areas.

10. Science and Technology: Projects on building material facilities for scientific and technological organizations; laboratories, experimental workshops; analytical, testing, and certification centers; specialized design rooms in natural science and engineering fields; technology application and transfer centers, standardization, measurement, and quality inspection bureaus; experimental stations and farms; high-tech zones, high-tech agriculture zones.

11. Information: Projects serving publishing, news agencies, press, ethnic radio and television broadcasting, and essential political and social public services.

12. Telecommunications: Telecommunication projects serving national defense and security objectives, ensuring national information security.

13. Information Technology: Projects on information technology infrastructure applications; electronic information security and safety in government agencies; information technology infrastructure providing online public services for citizens and businesses; e-commerce and electronic transaction infrastructure.

14. Education, Training and Vocational Education: Projects on constructing material facilities and equipment for educational and training institutions, vocational education institutions, from kindergarten to university levels, and technical infrastructure for university zones.

15. Health, Population and Food Safety: Projects on hospitals, health care facilities, testing, inspection, and appraisal centers of specialized management agencies.

16. Social Affairs: Projects on nurturing and caring for war veterans; job support; health care and maintenance for officials and civil servants; drug rehabilitation and other social assistance projects; projects to renovate and upgrade memorials for martyrs.

17. Natural Resources and Environment: Projects in marine and island surveying, mapping, meteorology, hydrology, geological exploration, mineral resources, water sources; environmental monitoring and warning; resource protection, pollution control, green growth, climate change response, and sustainable development.

18. State Administration: Projects on headquarters and office buildings for Party, National Assembly, Government agencies; headquarters of central ministries, departments, and political-social organizations authorized to invest; judicial agency headquarters; headquarters of local authorities (People's Councils, People's Committees at all levels); projects on purchasing, constructing, and renovating office buildings and housing for Vietnamese representative offices abroad and other Vietnamese government agencies abroad.

19. National Defense and Security: Projects serving national defense and security objectives, maintaining social order and security, responding to natural disasters and search and rescue operations.

20. National Reserves: Supplementing national reserve goods in 2016 to address the consequences of natural disasters, epidemics, and urgent tasks related to national defense, security, and social order requiring immediate resolution.

Article 2. Scope and Objects of Application

1. The principles, criteria, and allocation standards for development investment capital from the state budget for the period 2016-2020 shall serve as the basis for preparing medium-term and annual investment plans from the state budget for the period 2016-2020 at the national level, at all levels and sectors, and by units using state budget capital. At the same time, they shall serve as the basis for managing, supervising, inspecting, and auditing the implementation of medium-term and annual investment plans.

第二条 组织和实施奖励工作的支出水平，如政府第152/2025/NĐ-CP号决定关于分级授权和奖励领域的分权规定

a) Ministries, ministerial-level agencies, agencies under the Government, other central agencies, provinces, centrally governed cities, and units using state budget capital (hereinafter referred to as ministries, central sectors, and localities);

b) Agencies, organizations, and individuals participating in or related to the preparation of medium-term and annual investment plans from the state budget for the period 2016-2020.

II. GENERAL PRINCIPLES ON THE ALLOCATION OF DEVELOPMENT INVESTMENT CAPITAL FROM THE STATE BUDGET FOR THE PERIOD 2016-2020

1. General Principles on the Allocation of Medium-Term Investment Capital Plans from the State Budget for the Period 2016-2020 for the Nation

a) The allocation of development investment capital from the state budget for the period 2016-2020 must comply with the provisions of the Law on Public Investment, the Law on State Budget, and relevant legal documents.

b) Ensuring centralized and unified management in terms of objectives, mechanisms, and policies; implementing decentralization in investment management according to the law, creating autonomy for central ministries and sectors and local authorities.

c) The allocation of development investment capital from the state budget must serve the implementation of development goals and orientations set out in the National Socio-Economic Development Strategy for 2011-2020, the National Socio-Economic Development Plan for 2016-2020, sectoral and regional development plans, and approved industry and sectoral planning.

d) Being consistent with the ability to balance investment capital from the state budget and attract investment capital from other economic sectors, industries, and regions; ensuring macroeconomic balances, prioritizing public debt safety.

đ) Allocating concentrated investment capital, addressing the issue of dispersion and spreading thin, ensuring the effectiveness of capital use. Only allocate capital for projects that have completed investment procedures and been approved by competent authorities in accordance with the provisions of the Law on Public Investment and relevant legal documents.

e) Prioritizing the allocation of capital for mountainous areas, border areas, islands, ethnic minority regions, and regions with difficult socio-economic conditions, contributing to gradually narrowing the gap in economic development levels, income, and living standards between regions nationwide.

g) Concentrating capital allocation to complete and accelerate the progress of implementing national target programs, important national projects, programs, and projects of significant importance to the socio-economic development of the country and all levels and sectors.

h) Ensuring transparency in the allocation of public investment capital plans, contributing to promoting administrative reform and strengthening anti-corruption efforts, thrift, and the prevention of waste.

i) Reserving approximately 5% of the total central state budget reserve (unallocated) in the medium-term investment plan for the period 2016-2020 to address issues arising during the execution of the medium-term investment plan.

2. Principles on the Allocation of Medium-Term Investment Capital Plans from the State Budget for the Period 2016-2020 for Central Ministries and Sectors and Localities Central ministries and sectors and localities shall allocate development investment capital from the state budget for the period 2016-2020 according to the general principles stipulated above and the following specific principles:

a) Central ministries and sectors and localities shall prepare detailed allocations of 90% of the total amount of medium-term investment capital plan according to the project list and capital amount for each project, reporting to the competent authority for approval; reserving 10% of the total amount of the medium-term investment capital plan to address issues arising during the execution of the medium-term investment plan of their respective ministries, sectors, and localities.

b) The allocation of medium-term investment capital from the state budget for each sector, program of central ministries and sectors and localities in the period 2016-2020 shall be prioritized in the following order: - Prioritize capital allocation for projects that have been completed and handed over for use but not fully funded; projects expected to be completed within the plan period; counterpart funds for projects using ODA and concessional loans from foreign donors; state investment capital participating in projects implemented under the PPP model; - Projects carried over from previous periods according to the approved schedule; - New projects starting construction that meet the requirements stipulated in Clause 5, Article 54 of the Law on Public Investment and the Decree guiding the implementation of the Law on Public Investment.

c) Regarding the allocation of funds to settle outstanding construction debts and repay advance payments: - For central ministries, sectors, and localities with small amounts of outstanding construction debts and advance payments, it is necessary to allocate sufficient capital from the medium-term investment plan within each sector, field, and program to settle outstanding construction debts and recover advance payments; the remaining portion should be allocated for counterpart funding for ODA programs and projects and for completed and ongoing projects. Any remaining funds (if any) may then be allocated for the commencement of new projects. - For central ministries, sectors, and localities with large amounts of outstanding construction debts and advance payments (where allocating sufficient funds from the medium-term investment plan to settle outstanding construction debts and recover advance payments would leave no source for counterpart funding for ODA programs and projects and for ongoing projects), it is required that these entities: + Allocate sufficient funds to settle outstanding construction debts. For localities, if the central government's budget in the medium-term investment plan does not adequately balance, they are allowed to use annual increased revenue sources (after allocating for salary reform) to settle outstanding construction debts. For localities without increased budget revenues, other sources of funds such as lottery proceeds and other lawful sources must be mobilized to settle debts. Localities must develop specific plans for the amount of debt repayment from the central government's budget medium-term investment plan and the amount of debt repayment from local budget revenue increases and other lawful sources. + Allocate funds to settle approximately 50% of the advance payments according to sector, field, and program. The remaining funds should be allocated for counterpart funding for ODA programs and ongoing projects. Medium-term investment plan funds shall not be allocated for the commencement of new projects, except in special cases due to

d) The allocation of foreign funds (ODA) by central ministries, sectors, and localities shall be carried out according to the following principles: - Prioritize allocation for ongoing ODA programs and projects that are effective; for ongoing projects deemed ineffective, research should be conducted to immediately halt their implementation to ensure the efficient use of loan funds. - For newly commenced projects during the period 2016-2020, strict control over necessity must be exercised; only implement truly effective projects; they must align with the disbursement capacity of ODA funds under signed agreements with sponsors and projects that have been

đ) Regarding preparatory investment capital: Central ministries, sectors, and localities proactively balance within the allocated capital according to sector, field, and program to prepare for project investments.

Article 3. Implementation Organization

1. The Ministry of Planning and Investment:

a) Take the lead and coordinate with the Ministry of Finance to determine the total development investment capital from the state budget for the medium term and annually during the period 2016-2020;

b) Take the lead and coordinate with the Ministry of Finance, central ministries, sectors, and localities to develop allocation plans for state budget development investment capital for the medium term and annually during the period 2016-2020 for central ministries, sectors, and localities in accordance with the principles, criteria, and standards stipulated in this Decision;

c) Guide central ministries, sectors, and localities to develop allocation plans for state budget development investment capital for the medium term and annually during the period 2016-2020 for central ministries, sectors, and localities in accordance with the principles, criteria, and standards stipulated in this Decision.

2. Ministry of Finance:

a) Coordinate with the Ministry of Planning and Investment to balance state budget development investment capital for the medium term and annually to implement the principles, criteria, and standards stipulated in this Decision;

b) Take the lead and coordinate with the Ministry of Planning and Investment to determine the proportion of revenue redistribution to the central budget and the additional balance in the local budget for localities during the period 2017-2020;

c) Provide the Ministry of Planning and Investment with information and data on national and provincial-level state budget revenues and expenditures to serve the development of principles, criteria, and standards for allocating state budget development investment capital.

3. Ministries equivalent to ministries, agencies under the Government, and other central agencies:

a) Develop medium-term and annual state budget development investment plans for the period 2016-2020 in accordance with the principles, criteria, and standards stipulated in this Decision;

b) Be responsible before

c) Provide the Ministry of Planning and Investment with information and data within their respective fields of responsibility to serve the development of principles, criteria, and standards for allocating state budget development investment capital.

4. People's Committees of provinces and centrally-administered cities:

a) Based on the principles, criteria, and standards for allocating development investment capital attached to this Decision, financial capacity, and the specific situation of the locality, develop principles, criteria, and standards for allocating state budget development investment capital for sectors and levels of the locality to report to the People's Council of the province or centrally-administered city for decision;

b) Develop medium-term and annual state budget development investment plans for the period 2016-2020 in accordance with the principles, criteria, and standards stipulated in this Decision;

c) Be responsible before

Chapter III. PRINCIPLES FOR ALLOCATING STATE BUDGET FUNDS FOR THE DEVELOPMENT OF CENTRAL MINISTRIES AND SECTORS

1. Central ministries and sectors allocated state budget development funds include: - Central agencies of political organizations. - Judicial agencies (Supreme People's Procuracy, Supreme People's Court). - State Audit Office. - Office

2. Principles for allocating funds Implementation shall be in accordance with the contents of Section II of this Regulation on general principles for allocating funds, the priority order for allocating funds, and the following specific principles: - Allocation of funds by sector for central ministries and sectors must aim to achieve strategic goals, planning, and five-year and annual socio-economic development plans of the country and economic sectors. - Be consistent with the state budget's balancing capacity and mobilization of other sources of capital for investment in economic and social infrastructure. - Ensure a reasonable relationship between the development capital allocated to central ministries and sectors and supplementary program capital and capital within local government budgets. - Allocation of funds for projects must ensure that the projects are included in approved planning and have complete investment procedures as prescribed. - All projects allocated funds in the medium-term investment plan for the period 2016-2020 must be appraised regarding their funding sources and the ability to balance funds at all levels with authority. - For projects invested in by central agencies of the Vietnam Fatherland Front, political-social organizations, and other agencies and organizations:

Article 4. Effective date

1. The Minister of Planning and Investment shall take the lead in guiding, monitoring, and urging ministries, central sectors, and localities to implement this Decision.

 IV. PRINCIPLES, CRITERIA, AND STANDARDS FOR ALLOCATING CAPITAL FOR DEVELOPMENT FROM LOCAL GOVERNMENT BALANCED BUDGETS

1. Principles for establishing criteria and standards for allocation of funds - Must be consistent with the provisions of the Public Investment Law and the State Budget Law. - Criteria and standards for allocating development capital from local government balanced budgets shall apply for the period 2016-2020. - Ensure a reasonable relationship between the development of key economic regions, localities with high revenue and high rates of central budget transfer, and prioritizing mountainous areas, border regions, islands, ethnic minority regions, and other difficult regions to gradually narrow the gap in economic development, income, and living standards between regions nationwide. - Utilize state budget investment capital effectively to create conditions for attracting maximum other sources of capital for development. - Ensure transparency, fairness, and openness in the allocation of development capital.

2. Criteria for allocating funds The criteria for allocating development capital in the balance (excluding land revenue and lottery revenue) for localities include the following five groups: (1) Population criteria, including: average population and number of ethnic minorities in localities. (2) Development level criteria, including: poverty rate, domestic revenue (excluding land revenue) and the ratio of central budget transfer. (3) Area criteria, including: natural land area of localities and the proportion of paddy field area over total natural land area. (4) Administrative unit criteria at district level: including criteria for the number of administrative units at district level; number of mountain districts; highlands, islands; land borders of each locality. (5) Supplementary criteria, including: - Criteria for ATK communes in the resistance base area (historical ATK). - Criteria for border communes, including: border communes of Vietnam-China, Vietnam-Laos, and Vietnam-Cambodia.

3. Determining the points for each specific criterion

a) Population criteria: including average population and number of ethnic minorities in 2014. Calculation details as follows: (1) Points for the average population criterion Average population Up to 500,000 people 10 Over 500,000, for every additional 100,000 people, 3 additional points The average population of localities for calculating points is based on data published by the General Statistics Office in 2014. (2) Points for the ethnic minority population criterion Number of ethnic minorities For every 100,000 ethnic minorities, 4 points The number of ethnic minorities in localities for calculating points is based on data published by the General Statistics Office in 2014.

b) Development level criteria, including three criteria: poverty rate, domestic revenue (excluding land revenue, crude oil revenue, and import-export tax revenue), and the ratio of central budget transfer of provinces and cities. (1) Points for the poverty rate criterion Poverty rate For every 5% poverty rate, 3.5 points The poverty rate is determined based on data published by the General Statistics Office in 2013. (2) Points for the domestic revenue criterion (excluding land revenue, crude oil revenue, and import-export tax revenue): Domestic revenue Up to 2,000 billion VND 3 Over 2,000 billion VND to 20,000 billion VND, for every additional 1,000 billion VND, 4 additional points Over 20,000 billion VND to 60,000 billion VND, for every additional 1,000 billion VND, 6 additional points Over 60,000 billion VND to 100,000 billion VND, for every additional 1,000 billion VND, 9 additional points Over 100,000 billion VND, for every additional 1,000 billion VND, 12 additional points Localities' domestic revenue (excluding land revenue, crude oil revenue, and import-export tax revenue) is calculated according to the 2015 state budget revenue estimate

c) Criteria for area, including two criteria: natural land area and the ratio of paddy field area to total natural land area. (1) Natural land area The natural land area Up to 2,000 km² 6 For over 2,000 km² up to 5,000 km², each additional 1,000 km² is counted as 2 For over 5,000 km² up to 10,000 km², each additional 1,000 km² is counted as 1 For over 10,000 km², each additional 1,000 km² is counted as 0.5 The natural land area is determined based on the natural land area data as of January 1, 2015, published by the General Statistics Office. (2) Ratio of paddy field area to total natural land area The ratio of paddy field area to total natural land area Areas with a paddy field area ratio up to 20% are not counted Points From over 20% to 30%, each additional 1% is counted as 0.5 Over 30% to 50%, each additional 1% is counted as 1 Over 50%, each additional 1% is counted as 2 The paddy field area for point calculation is based on the paddy field area data as of January 1, 2014, published by the Ministry of Natural Resources and Environment.

d) Administrative unit criteria at the district level, including: administrative unit criteria at the district level (including the number of districts, counties, and towns), mountainous districts, highland districts, island districts, and border districts. (1) Points for administrative unit criteria at the district level: Administrative unit at the district level Each district is counted as 1 The points for administrative units at the district level are calculated based on the number of administrative units at the district level as of August 31, 2015, published by the Ministry of Home Affairs. (2) Points for mountainous district administrative unit criteria Mountainous district administrative unit Each district is counted as 0.5 The points for mountainous district administrative units are calculated based on the number of mountainous district administrative units as of August 31, 2015, published by the Committee for Ethnic Minorities. (3) Points for highland and island district administrative unit criteria Highland and island district administrative unit Each district is counted as 0.5 The points for highland and island district administrative units are calculated based on the number of highland and island district administrative units as of August 31, 2015, published by the Committee for Ethnic Minorities. (4) Points for border district administrative unit criteria Border district administrative unit Each district is counted as 1 The points for border district administrative units are calculated based on the number of border district administrative units as of August 31, 2015, published by the Ministry of Foreign Affairs.

e) Additional criteria A locality with one land border commune (Vietnam-China, Vietnam-Laos, Vietnam-Cambodia) 0.3 One commune in the revolutionary base area (historical ATK resistance) 0.3 The number of land border communes (communes along the Vietnam-China border and communes along the Vietnam-Laos and Vietnam-Cambodia borders for point calculation is determined based on data provided by the Ministry of Foreign Affairs as of August 31, 2015. The number of communes in the revolutionary base areas (historical ATK resistance) of localities for point calculation is determined based on data provided by the Ministry of Home Affairs as of August 31, 2015.

4. Method for calculating the amount of capital allocated

a) Based on the above criteria to calculate the points for each province and city and the total points of 63 provinces and cities as the basis for allocating investment capital in the budget balance, according to the following formulas: - Points for population criterion: Let the total points for the population criterion of province i be Ai Let the points for the population of province i be hi Let the points for ethnic minority population of province i be ki The points for the population criterion of province i will be: Ai = hi + ki - Points for development level criterion: Let the total points for the development level criterion of province i be Bi Let the points for the poverty rate criterion of province i be ni Let the points for the domestic revenue criterion (excluding land revenue) of province i be oi Let the points for the central government budget adjustment ratio be pi The points for the development level criterion of province i will be: Bi = ni + oi + pi - Points for area criterion: Let the total points for the area criterion of province i be Ci Let the points for natural area be qi Let the points for the ratio of paddy field area to total area be ri The points for the area criterion are: Ci = qi + ri - Points for administrative unit criterion at the district level: Let the points for the administrative unit criterion at the district level be Di Let the points for the general administrative unit criterion at the district level of province i be si Let the points for the mountainous district administrative unit criterion of province i be ti Let the points for the highland and island district administrative unit criterion of province i be ui Let the points for the border district administrative unit criterion of province i be vi The total points for the administrative unit criterion of province i will be Di: Di = si + ti + ui + ni - Points for additional criteria: Let the points for border communes be Ei Let the points for communes in the revolutionary base area (ATK resistance) be Fi The total points for the additional criteria of province i are called Li: Li = Ei + Fi - Total points for province i: Let the total points for province i be Xi: Xi = Ai + Bi + Ci + Di + Li - The total points of 63 provinces and cities are Y, we have:

b) The standard capital for one allocation point is calculated according to the formula: Let K be the total capital in the local budget balance (excluding investment from land transfer revenue). Z is the standard capital for one allocation point, we have:

c) The total investment capital in the budget balance (excluding capital from land transfer revenue and lottery revenue) of each locality is calculated according to the formula: Let Vi be the investment capital in the budget balance (excluding capital from land transfer revenue and lottery revenue): Vi = Z x Xi

5. Adjustment of unreasonable allocations After allocating according to the principles, criteria, and standards mentioned above, for localities with investment capital in the budget balance (excluding capital from land use revenue and lottery revenue) lower than the 2015 plan due to

6. Investment capital in the local budget balance

a) Investment capital within the local budget balance for the year 2016: (1) The investment capital within the local budget balance is calculated based on the criteria and standards stipulated in Points 4 and 5 of this Section and the local land revenue budget estimate for the year 2016. (2) For localities subject to central budget adjustment during the period from 2011 to 2015, if the investment capital within the local budget balance for the year 2016 (excluding land revenue) calculated according to the adjustment ratio for the period from 2011 to 2015 is greater than the capital calculated according to the criteria and standards mentioned in item (1) above, then the investment capital within the local budget balance for the year 2016 will be determined based on the investment capital calculated according to the adjustment ratio for the period from 2011 to 2015 and the local land revenue budget estimate for the year 2016.

b) Investment capital within the local budget balance for the year 2017 is calculated at an increase of 10% compared to the investment capital within the local budget balance for the year 2016, based on the criteria and standards stipulated in Points 4 and 5 of this Section and the local land revenue and lottery revenue budget estimates for the year 2017. The investment capital within the local budget balance for the year 2017 serves as the basis for determining the adjustment ratio for the central budget and the additional allocation from the central budget for localities during the period from 2017 to 2020.

c) Investment capital within the local budget balance for the years 2018 to 2020 during the stabilization period from 2017 to 2020: - For localities subject to central budget adjustment during the period from 2017 to 2020, the investment capital within the local budget balance for the years 2018 to 2020 is calculated based on the revenue sources and the adjustment ratio between the central budget and the local budget, and the annual land revenue and lottery revenue budget estimates of the localities. - For localities not subject to central budget adjustment, where the revenue within the budget balance does not increase or increases insignificantly (insufficient to cover regular tasks), the central budget supplements within the budget balance to ensure that the investment capital within the local budget balance for the years 2018 to 2020 is increased by 10% compared to the previous year's budget estimate.

Article 5. Responsibilities for Implementation

1. The Minister of Planning and Investment shall be responsible for leading, guiding, monitoring, and urging ministries, sectors, and localities to implement this Decision.

General Secretary,

V. PRINCIPLES, CRITERIA AND STANDARDS FOR ALLOCATING CENTRAL BUDGET CAPITAL TO NATIONAL TARGET PROGRAMS AND GOVERNMENT BONDS CAPITAL

1. For national target programs, after the National Assembly approves the investment policy,

2. For government bond capital: the principles, criteria, and standards for allocating government bond capital shall be implemented in accordance with the provisions of the National Assembly's Resolution.

Chapter VI. PRINCIPLES AND CRITERIA FOR ALLOCATING CENTRAL BUDGET CAPITAL TO TARGET PROGRAMS

1. General principles

a) Regarding the allocation of capital for target programs - Must comply with the principles for allocating capital for medium-term and annual public investment plans to programs and projects and the conditions for programs and projects allocated capital for medium-term and annual public investment plans as prescribed in the Public Investment Law, guiding documents for implementing the Public Investment Law, and directives for managing and directing issued by the Government and

b) Regarding the mechanism for supporting central budget capital for projects managed by localities - For support from central budget capital through target programs, it will focus on large, key projects with wide-ranging impact, promoting local economic and social development, inter-provincial and inter-regional projects. For smaller-scale projects, localities will use their balanced budget capital and other lawful sources of capital to implement them.

c) Regarding the scale of supported projects: To ensure concentrated and effective capital allocation, for new projects during the period from 2016 to 2020, central budget capital will only support projects from Group B onwards; except in special cases involving urgent projects related to disaster prevention and control, disease control, security, defense, and addressing the most pressing issues of localities due

c) Regarding the level of support from the central budget for projects managed by localities For new projects initiated during the period from 2016 to 2020, the central budget will provide full support of 100%, including: investment preparation capital, compensation and land clearance capital, construction and installation capital, equipment capital, and other related costs within the approved total investment amount as stipulated by law. In necessary cases and where budget balancing is possible, localities may allocate local balanced budget capital or other lawful sources of capital to prepare for investment, compensate and clear land, etc., for specific projects. For ongoing projects that have been supported by central budget capital during the period from 2011 to 2015 and new projects not yet allocated central budget capital plans but before the effective date of the Public Investment Law had been

2. Specific principles for allocating capital for target programs during the period from 2016 to 2020 (1) Target Program on Economic and Social Development in Regions

a) Scope of Support Localities within the Resolutions of the Politburo on economic and social development and ensuring national defense and security in regions during the period from 2016 to 2020, which have projects suitable for the program's support targets, with priority given to supporting investment in poor provinces unable to self-balance budgets and provinces with underdeveloped infrastructure.

b) Support Targets - Important economic and social infrastructure projects in regions and localities, focusing mainly on the following infrastructure projects: + Key transportation projects, inter-provincial and inter-regional connection projects of localities; roads connecting to expressways, national highways, economic zones (including border economic zones, industrial parks, high-tech zones), important border gates, seaports, airports. + Large-scale water conservancy projects with wide-ranging impacts. + Essential facilities and infrastructure of public universities and university zones managed by localities within the planning framework

c) Principles, criteria for allocating capital Implement according to the general principles for allocating capital for programs and targets set forth in Point 1, Section VI of these Provisions and the following principles and criteria: - Prioritize projects with significant ripple effects, enhancing the synchronous effectiveness of projects, and infrastructure projects that have been invested in and constructed. - Prioritize projects that create conditions for attracting other resources to invest in developing local infrastructure systems. (2) Target Program Providing counterpart capital for ODA for localities

a) Scope of support Localities with projects using ODA and preferential foreign loan funds incorporated into the state budget balance, implemented during the period from 2016 to 2020.

b) Objectives of support - Support for projects using investment development funds balanced within the state budget (in the form of central government budget allocation) directly managed by the locality, without allocating counterpart capital for projects funded entirely by operating expenses and projects for relending. - For projects with a mixed capital structure consisting of operating funds and investment funds, only support the portion of investment development capital.

c) Principles, criteria for allocating counterpart capital - Localities whose central government budget supplements more than 50% in the balance will be supported up to a maximum of 80% of the counterpart capital of a project. - Localities whose central government budget supplements less than 50% in the balance will be supported up to a maximum of 50% of the counterpart capital of a project. - Do not provide counterpart capital support for projects using foreign capital in localities that have budget adjustments at the central level. (3) Target Program Sustainable Development of Aquaculture Economy

a) Scope of support Central ministries and agencies and localities with projects falling under the investment targets of the program, prioritizing support for difficult localities that have not yet achieved budget balance.

b) Objectives of support Important infrastructure projects in aquaculture farming areas, fishing ports, storm shelters, breeding centers, concentrated seed production areas, prioritizing the following projects: - Water supply and drainage, electricity supply, internal transportation infrastructure projects in concentrated aquaculture farming areas and large-scale concentrated seed production areas. - National aquatic breeding centers, provincial-level breeding centers' external infrastructure approved by competent authorities. - Essential infrastructure of fishing ports and storm shelters.

c) Principles, criteria for allocating capital Implement according to the general principles for allocating capital for programs and targets set forth in Point 1, Section VI of these Provisions. - Regarding priority investment principles: + For aquaculture: Prioritize allocation for coastal provinces, Mekong Delta provinces, provinces with large water reservoirs, and provinces with potential for marine aquaculture. + For fisheries: Prioritize port and storm shelter projects at the regional level, Class I fishing ports. + Prioritize projects combining economic activities with national defense and security, such as combined fishing ports and storm shelters. + Prioritize projects involving private sector participation. (4) Target Program Sustainable Forestry Development

a) Scope of support Central ministries and agencies and localities with projects falling under the investment targets of the program, prioritizing support for difficult localities that have not yet achieved budget balance.

b) Objectives of support - Support for people planting forests and developing forests according to state policies. - Basic infrastructure projects of provincial-level forestry breeding centers and above, forestry roads, processing plant support, forest fire prevention projects, elephant conservation, wildlife conservation. - Essential infrastructure projects of national parks, natural conservation areas along borders related to national defense and security.

c) Principles, criteria for allocating capital Implement according to the general principles for allocating capital for programs and targets set forth in Point 1, Section VI of these Provisions and the following principles and criteria: - Prioritize investments in upstream forest planting projects of major national hydropower and irrigation projects; coastal protective forests; projects in mountainous areas, remote areas located in poor districts according to Resolution No. 30a/2008/NQ-CP, and particularly difficult communes. - Prioritize investments in national park forest protection projects, large special-use forests, and wildlife conservation projects. (5) Target Program Restructuring the Agricultural Economy and Mitigating Natural Disasters to Stabilize People's Livelihoods

a) Scope of support Central ministries and agencies and localities with projects falling under the investment targets of the program, prioritizing support for difficult localities that have not yet achieved budget balance.

b) Objectives of support - Essential infrastructure of concentrated production areas implementing policies to encourage production linkage and consumption of agricultural products.

c) Principles, criteria for allocating capital Implement according to the general principles for allocating capital for programs and targets set forth in Point 1, Section VI of these Provisions. (6) Target Program Rural, Mountainous, and Island Electricity Supply

a) Scope of support Localities according to Decision No. 2081/QĐ-TTg dated November 8, 2013, with projects falling under the program's support targets, prioritizing support for poor provinces that have not achieved budget balance, provinces with a lower percentage of households using national grid electricity compared to the national average, mountainous provinces, border provinces, and provinces with densely populated islands, strategic islands with important national defense and security positions that have not been electrified, or have been electrified but are unstable and intermittent.

b) Support Object - Projects to provide electricity to the centers of communes, villages, and hamlets that have not yet been connected to the national power grid and have been approved by competent authorities. - Projects to upgrade or construct new medium-voltage and low-voltage three-phase power lines to ensure stable electricity supply for pumping stations and drainage stations in the 13 provinces of the Mekong Delta (incorporated into rural electrification sub-projects from local power grids). - Projects to provide electricity to islands.

c) Capital Allocation Principles Implement according to the general principles for allocating capital for target programs as stipulated in Point 1, Section VI of this Regulation. Specifically regarding the structure of central budget support, implement according to Decision 2081/QĐ-TTg dated November 8, 2013 of

a) Scope of Support - Coastal economic zones in localities meeting the following conditions: (i) established pursuant to Decisions of

b) Support Objectives - For coastal economic zones: + Construction of main transportation systems within the zone; + Compensation, land clearance, and construction of technical infrastructure and social infrastructure for worker housing areas and resettlement areas serving those whose land has been expropriated within the coastal economic zone; + Investment in solid waste treatment facilities and centralized wastewater treatment systems for functional areas within the economic zone (including drainage systems and centralized wastewater treatment plants). - For border economic zones: + Land leveling within the zone; + Construction of main roads and other essential infrastructure projects (inter-ministerial control posts, berths, anti-erosion embankments, etc.) within the zone; + Construction of electricity, water supply, wastewater treatment, and solid waste disposal projects within the zone. - For industrial parks and clusters: + Centralized wastewater treatment systems; + Technical infrastructure within the boundaries of industrial parks and clusters; + Access roads and entry roads to industrial parks and clusters. - For high-tech zones and high-tech agricultural zones: + Land leveling; + Construction of main transportation systems within the zone; + Construction of electricity, water supply, wastewater treatment, and solid waste disposal projects; + Other essential infrastructure projects.

c) Principles and Criteria for Capital Allocation - Implement according to the general principles for allocating capital for target programs as stipulated in Point 1, Section VI of this Regulation. Specifically for projects invested under the Public-Private Partnership (PPP) model, support will be provided according to the ratio specified in the project contract. - For coastal economic zones and border economic zones: Allocate at least 70% of total investment capital to localities with key coastal economic zones and border economic zones, prioritizing large-scale projects in coastal economic zones that significantly impact regional and national economies, and border economic zones with high cargo volumes. - For industrial parks and clusters: Prioritize provinces in the Northern Midland and Mountainous Region and the Central Highlands. Localities eligible for central budget support may receive assistance for a maximum of one industrial park and one cluster during the 2016-2020 period. Provinces in the Northern Midland and Mountainous Region and the Central Highlands will receive a maximum of 170 billion VND per locality over five years, with at least 120 billion VND allocated for industrial park infrastructure. Other localities will receive a maximum of 150 billion VND per locality, with at least 100 billion VND allocated for industrial park infrastructure. + Central government investment funds shall be used for projects in the following priority order: (1) centralized wastewater treatment systems; (2) technical infrastructure within the boundaries of industrial parks and clusters; (3) access roads and entry roads to industrial parks and clusters; + For industrial parks and clusters supported between 2011-2015 but which have not yet constructed or are currently constructing centralized wastewater treatment plants that do not meet actual wastewater flow requirements, the central budget will prioritize funding for these industrial parks and clusters to complete and put into operation wastewater treatment systems that meet environmental standards. After completing the support for the aforementioned items, the remaining funds will be allocated to the industrial parks and clusters according to the prescribed criteria and priorities. - For high-tech zones and high-tech agricultural zones: Implement according to Government Decree 99/2003/NĐ-CP, Document No. 6562/VPCP-KTTH dated November 13, 2007, Notification No. 204/TB-VPCP dated June 23, 2014 of the Government Office, Decision No. 1895/QĐ-TTg dated December 17, 2012, and Decision No. 575/QĐ-TTg dated May 4, 2015 of

a) Scope of Support Localities with boarding schools for ethnic minority students and schools and branch schools with ethnic minority students studying there as decided by competent authorities.

b) Support Objectives Continue to invest in material infrastructure for 48 boarding schools for ethnic minorities under the Project to Consolidate and Develop Ethnic Minority Boarding Schools as stipulated in Decision No. 1640/QĐ-TTg dated September 21, 2011 of

c) Principles and Criteria for Capital Allocation Implement according to the general principles for allocating capital for target programs as stipulated in Point 1, Section VI of this Regulation. - Prioritize investment in the following order: (1) boarding schools for ethnic minorities, (2) branch schools for ethnic minority students, (3) schools and branch schools with very few ethnic minority students.

a) Scope of Support Central ministries and agencies and localities with social welfare institutions included in approved planning, prioritizing support for investment in poor provinces unable to balance their budgets.

b) Support Objectives - Projects to construct and upgrade provincial-level comprehensive social welfare centers and provincial-level social work centers as stipulated in Decision No. 524/QĐ-TTg dated April 20, 2015 of

c) Principles and criteria for allocating capital Implement according to the principles and criteria for allocating capital for the target programs specified in Point 1, Section VI of this Regulation and the following principles and criteria: - Prioritize projects in localities with participation from the private sector. - Each locality shall not be supported more than 150 billion VND to implement the program during the period 2016-2020. - Prioritize investment support for key localities with a large number of beneficiaries requiring assistance and localities facing budgetary difficulties but lacking social assistance facilities in terms of quantity and quality, failing to meet the requirements for care and assistance for beneficiaries. (10) Target Program on Health - Population

a) Scope of support Localities with provincial, regional preventive healthcare centers and family planning centers, including preventive healthcare centers, occupational health and environmental hygiene centers, HIV/AIDS prevention centers, tuberculosis prevention centers, malaria prevention centers, dermatology centers, reproductive health care centers, inspection centers, pharmaceuticals, cosmetics, and food testing centers, population and family planning counseling and service centers, food safety control agencies, etc., which are included in the approved master plan, currently under construction or yet to be constructed, with priority given to supporting construction in poor provinces unable to balance their budgets.

b) Recipients of support Projects for constructing and purchasing equipment for provincial-level centers managed by localities, excluding construction of administrative offices.

c) Principles and criteria for allocating capital Implement according to the principles and criteria for allocating capital for the target programs specified in Point 1, Section VI of this Regulation and central budget-supported projects must be part of the overall development plan for the healthcare system at each stage and approved proposals.

a) Scope of support Localities with projects within the scope of investment of the program, with priority given to supporting construction in poor provinces unable to balance their budgets.

b) Recipients of support Public hospitals and provincial-level medical examination and treatment centers included in the overall development plan for the healthcare system approved by competent authorities, including: - Investment in general and specialized hospitals; provincial-level medical examination and treatment centers, including cancer centers, cardiovascular centers, eye centers, transport and emergency centers, trauma and orthopedic centers, obstetrics and pediatrics centers, etc., as part of the proposal to reduce hospital overload for the period 2013-2020 approved by Decision No. 92/QĐ-TTg dated January 9, 2013 of

c) Principles and criteria for allocating capital Implement according to the principles and criteria for allocating capital for the target programs specified in Point 1, Section VI of this Regulation and the following principles and criteria: - Prioritize investment in projects to ensure synchronization and enhance the effectiveness of previously invested projects. - Prioritize investment in hospitals that are central hospitals in regions. (12) Target Program on Cultural Development

a) Scope of support Localities with projects within the scope of investment of the program, with priority given to supporting construction in poor provinces unable to balance their budgets.

b) Recipients of support - Investment in essential components of projects aimed at restoring, protecting, and promoting the value of cultural heritages recognized by UNESCO and special national monuments designated by

c) Principles and criteria for allocating capital Implement according to the principles and criteria for allocating capital for the target programs specified in Point 1, Section VI of this Regulation and the following principles and criteria: - Prioritize severely deteriorated monuments requiring urgent conservation; important cultural heritages and special national monuments that need to promote their value as a driving force for traditional cultural development and dissemination. - Prioritize projects involving participation from the private sector. (13) Target Program on Tourism Infrastructure Development

a) Scope of support Localities within key tourism development areas; localities with tourist zones, points, and routes identified in the Master Plan for the Overall Development of Tourism in Vietnam until 2020, with a vision to 2030, with priority given to supporting construction in poor provinces unable to balance their budgets.

b) Recipients of support - Roads from main arteries to tourist zones, points, and key tourism development areas. - Main arterial roads and waste management systems within tourist zones and points. - Embankments or dredging of lake beds to protect and restore tourism resources in tourist zones and points within key tourism development areas.

c) Principles and criteria for allocating capital Implement according to the principles and criteria for allocating capital for the target programs specified in Point 1, Section VI of this Regulation and prioritize investment in major, key projects with a ripple effect, primarily infrastructure connecting national tourist zones, national tourist points, and key tourism development areas within the approved master plan. (14) Target Program on Vocational Education - Employment and Occupational Safety

a) Scope of support Localities with high-quality vocational schools as stipulated in Decision No. 761/QĐ-TTg dated May 23, 2014 of

b) Recipients of support - 11 high-quality vocational schools as stipulated in Decision No. 761/QĐ-TTg dated May 23, 2014 of

c) Principles and criteria for allocating capital Implement according to the principles and criteria for allocating capital for the target programs specified in Point 1, Section VI of this Regulation. (15) Target Program on Information Technology

a) Scope of support - Ministries with projects to build databases as

b) Subjects supported - National information system projects, national databases, specialized databases, and online information connection systems within the e-Government platform. - Local infrastructure investment projects for information technology applications that meet the framework requirements for e-Government architecture; ensuring information security and safety, and interconnectivity between local information systems and national information systems and databases. - Infrastructure and technological solutions to ensure cybersecurity for information systems, databases, and computer networks of state agencies. - Basic infrastructure investment in centralized Information Technology Industrial Parks, developing key information technology industrial products, information security products, and information technology products serving national information systems according to specific targets set out in Decision No. 392/QĐ-TTg dated March 27, 2015.

c) Principles and criteria for capital allocation Implemented in accordance with the principles and criteria for allocating capital for the target programs specified in Point 1, Section VI of this Regulation. (16) Target Program on Thoroughly Addressing Severe Environmental Pollution Sources in Public Interest

a) Scope of support Localities with severe environmental pollution sources as stipulated in Decision No. 64/2003/QĐ-TTg dated April 22, 2003 and Decision No. 1788/QĐ-TTg dated October 1, 2013 of

b) Subjects supported - Landfills causing severe environmental pollution in public interest as stipulated in Decision No. 1788/QĐ-TTg dated October 1, 2013 of

c) Principles and criteria for capital allocation Implemented in accordance with the principles and criteria for allocating capital for the target programs specified in Point 1, Section VI of this Regulation. (17) Target Program on Responding to Climate Change and Green Growth

a) Scope of support Central ministries and agencies and provinces and centrally-administered cities with investment projects falling within the scope of support of the program.

b) Subjects supported - 62 priority projects listed in Document No. 1443/TTg-QHQT dated September 19, 2012 of

c) Principles for capital allocation Implemented in accordance with the principles and criteria for allocating capital for the target programs specified in Point 1, Section VI of this Regulation and in accordance with Decisions of

a) Scope of support The Ministry of Public Security and the Ministry of Defense have investment projects falling within the scope of support of the program.

b) Subjects supported - Projects enhancing the capacity of fire-fighting and traffic police forces managed by the Ministry of Public Security, approved by competent authorities. - Projects enhancing the capacity of anti-crime and anti-drug forces of the Ministry of Public Security and the Ministry of Defense, approved by competent authorities.

c) Principles and criteria for capital allocation Implemented in accordance with the principles and criteria for allocating capital for the target programs specified in Point 1, Section VI of this Regulation. (19) Target Program on National Defense Industry Implementing Resolution 06-NQ/TW of the Politburo (referred to as NDIP-06/BCT)

a) Scope of support Central ministries and agencies and related localities, focusing mainly on the Ministry of Defense.

b) Subjects supported Projects approved in Decisions No. 344/2012/QĐ-TTg dated March 23, 2012 approving adjustments to the Plan for Building and Developing the National Defense Industry for the period 2011-2015; No. 1375/2012/QĐ-TTg dated September 24, 2012 of

c) Principles and criteria for capital allocation Implemented in accordance with the principles and criteria for allocating capital for the target programs specified in Point 1, Section VI of this Regulation. Priority given to investment in key projects and deepening investments in modernizing technology within the Defense Industry Planning and Development Plan.

a) Scope of support The Ministry of Defense, land border provinces, provinces with Zone CT229, and provinces with high mine contamination density.

b) Subjects supported - For Border Management and Protection: Project: (i) Renovation, upgrading, and construction of new Border Guard Posts according to the typical model of the Ministry of Defense; (ii) Roads leading to Border Guard Posts, roads from Border Guard Posts and Border Stations to boundary markers for patrol and protection duties; (iii) Roads for rapid deployment of forces for national defense and security, combined with economic and social development in border areas. - For infrastructure investment in Zone CT229: + Projects under Proposal 01-229-2009 which have been

c) Principles and criteria for capital allocation Implemented in accordance with the principles and criteria for allocating capital for the target programs specified in Point 1, Section VI of this Regulation. Specifically, for new mine clearance projects initiated during the 2016-2020 period, the central budget will support each province with no more than one project and the funding amount will not exceed 50 billion VND. (21) Target Program on the South China Sea - Islands Ensuring National Defense and Security at Sea and on Islands

(21) Target Program on the South China Sea - Islands Ensuring National Defense and Security at Sea and on Islands

Implemented in accordance with Decision No. 610/QĐ-TTg dated May 8, 2015 of the Prime Minister regarding the approval of the Plan for the South China Sea - Islands Target Program Ensuring National Defense and Security at Sea and on Islands for the period 2016-2020./.