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Hanoi will need billions of dollars to develop transport infrastructure over the next five years, but funding is tight and this could affect the city's growth prospects, officials said.
The city's Party chief Hoang Trung Hai said while its economy grew at around 9 percent a year in the previous five-year period, spending for infrastructure in Hanoi was only 4 percent.
The number of migrants moving to Hanoi has annually increased by 1.4 percent on average, and the rate could be 1.9 percent this year, Hai said.
He proposed legislators approve a large budget from the state's coffers for new roads, urban rail links and other public transport projects.
“The longer it takes for the National Assembly to make up their mind, the worse things will become for Hanoi," he said, estimating that each of the eight planned metro rail lines would cost $2 billion.
Mayor Nguyen Duc Chung added that an urban monorail system worth about $1.3 billion can be an instant remedy for the city's worsening traffic congestion.
There are more than 5 million motorbikes on Hanoi’s roads. Statistics show that the city is adding as many as 19,000 newly registered vehicles each month.
With the number of vehicles growing 10 percent and road space at only 2 percent a year, traffic in Hanoi is on course for crippling gridlocks.
Meanwhile, many transport infrastructure projects including metro and monorail routes have been delayed for years due to the slow disbursement of officical development assistance (ODA) loans and other low-interest funds.
Finance Minister Dinh Tien Dung said it is difficult to allocate more funds to local governments given a shortfall of the national budget.
“The state budget will remain under pressure in the next few years due to tariff cuts and slumping crude oil prices,” Dung said.
Vietnam’s budget deficit stood at 5.69 percent in 2014 and 6.1 percent last year. As of the end of 2015, the country's public debt was more than VND2,680 trillion or $118 billion, equal to 62.2 percent of gross domestic product, close to the safety line of 65 percent set by the parliament.
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