Thông tư 39/2001/TT-BTC

CIRCULAR

GUIDING THE MANAGEMENT AND USE OF THE COOPERATION RECIPROCAL FUND OF THE KINGDOM OF BELGIUM, 2ND PHASE

Pursuant to the Special Agreement signed on December 7, 2000 between the Government of the Socialist Republic of Vietnam and the Government of the Kingdom of Belgium on the reduction of Vietnam’s foreign debts by Belgium and funding for projects in Vietnam (hereafter called Agreement for short), the Ministry of Finance provides the following guidance for the management and use of the Cooperation Reciprocal Fund of the Kingdom of Belgium in Vietnam 2nd Phase (hereafter called Reciprocal Fund II for short) set up from the Belgian debt conversion source under the Agreement:

I. GENERAL PROVISIONS:

1. The Ministry of Finance shall set up Reciprocal Fund II from the State budget�s source for repayment of debt to the Belgian Government.

2. The account of Reciprocal Fund II shall be opened at the Central State Treasury, owned by the Foreign Financial Relations Department of the Ministry of Finance and shall be used to cover VND expenditures of bilateral cooperation projects/programs within the framework of the cooperation program between Belgium and Vietnam in the period 2001-2003. The use of money from Reciprocal Fund II for these projects/programs shall be carried out through an agreement between the two governments.

3. The execution of Reciprocal Fund II shall be conducted by the Executive Board composed of the following members:

- The representative of the Ministry of Finance

- The representative of the Ministry of Planning and Investment

- The International Cooperation Counselor of the Belgian Embassy

- The representative of the Belgian Technical Cooperation Agency

- The representative of the Vietnamese agency performing the cooperation project/program.

The Ministry of Finance shall preside over meetings of the Executive Board.

The Executive Board has responsibilities to appraise the impact and the durability of the future projects to be funded by Reciprocal Fund II; to analyze the progress and the mode of implementation of the project; to inspect the execution of Reciprocal Fund II and to determine the necessary amounts for the selected projects.

4. The Ministry of Finance shall have to inform the Belgian Technical Cooperation Agency of the use of capital from Reciprocal Fund II for the projects so that the Belgian side can carry out the procedures for amortizing debts for Vietnam according to the Agreement.

II. SPECIFIC PROVISIONS ON THE MODE OF MANAGEMENT AND USE OF RECIPROCAL FUND II

1. The total value of Reciprocal Fund II shall be the amount of VND corresponding to 317,591,164 Belgian Francs (BEF) or 7,872,879.31 Euro (EUR). Basing itself on the annual funding plan (with quarterly allocations) made by the project/program owner entitled to use Reciprocal Fund II (hereafter called project owner for short) and sent to the Ministry of Finance periodically once every six months (on January 15 and July 15 each year), the Ministry of Finance shall transfer money from the State budget to the account of Reciprocal Fund II at the Central State Treasury and make the accounting for debt repayment to the Belgian side.

2. The projects, which have been accepted by the Vietnamese and Belgian Governments as being funded by Reciprocal Fund II, shall have to record clearly in separate Agreements of the project the monetary value funded by Reciprocal Fund II and must specify details of the expenditures in the financial-technical dossier of the project.

3. The project owner shall open a capital source account at the State Treasury where regular transactions are carried out to receive amounts supplied by the Ministry of Finance from Reciprocal Fund II.

4. Basing themselves on the progress of implementation of the project, the project owner shall draw up plans of using the money from Reciprocal Fund II quarterly and yearly and send them to the higher controlling agency for approval, and also to the Ministry of Finance (the External Financial Relations Department) in order to enter the balance of the State budget. These plans shall also be sent to the Vietnamese and Belgian members in the Executive Board for coordination in monitoring and guidance of implementation.

If the amounts used in Reciprocal Fund II listed in the project documents are in foreign currencies (Belgian Franc or Euro), the exchange rate in VND for the planning and real fund allocation from Reciprocal Fund II shall be announced by the Ministry of Finance (based on the market exchange rate on the first working day of that fiscal year as stipulated in the Agreement).

5. Allocation procedures:

a/ For the first allocation of fund, the project owner shall send to the Ministry of Finance (the External Financial Relations Department):

- The separate agreement attached to the financial-technical dossier of the project;

- The approval decision of the project document by the competent authorities;

- The plan of fund use in the plan year;

- The written request for monetary allocation attached with the identification number of the account at the State Treasury where transactions are conducted, signed by the two co-directors of the project, Vietnamese and Belgian.

The first allocation of fund shall be performed on the basis of the plan of fund use of the project in the plan year.

b/ For each of the subsequent allocations of fund, the project owner shall send to the Ministry of Finance (External Financial Relations Department) :

- A written request for the allocation with specification of the amount of money in VND, the corresponding original currency, the identification number of the account for money transfer signed by two co-directors of the project, Vietnamese and Belgian;

- The report on the expenditures from the amount allocated in the previous period certified by the State Treasury where transactions are conducted.

After full reception of the above required documents, within three working days the Ministry of Finance (the External Financial Relations Department) shall fill procedures for the transfer of money to the source account opened by the project owner at the State Treasury.

6. State budget accounting:

On the basis of the money transferred to the project from Reciprocal Fund II, the Ministry of Finance shall fill procedure of accounting to record the State budget collection of the aid money from the source to convert the debts to the Belgian government and make accounting for supplementary target allocation to the People’s Committee of the province or city or transfer the fund to the ministry or central agency managing the project.

The People’s Committees of the provinces and cities and the ministries, the central agencies managing the projects shall have to inform the project owners of the above State budget allocation so that the project owners can make the accounting in the books and make the final settlement of expenditures for the project.

7. The State Treasury at all levels shall have to inspect the expenditures as currently prescribed on the basis of the Financial-Technical Dossier of the project, including the stipulations on the project items eligible to use money from Reciprocal Fund II and the certification of the expenditures from the amount that can be used in the projects within the program of Belgian debt conversion.

8. Reporting and final settlement regime.

- Periodically every six months and yearly, the project owner shall have to report on the situation of implementing the project, the use of the fund allocated from the Reciprocal Fund in the previous period to the Ministry of Finance, the People’s Committee of the province and centrally run city or the ministry or central agency managing the project. The project owner has to observe the regime of reporting to the Executive Board of the Reciprocal Fund as stipulated in the financial-technical dossier of the project.

- The project owner shall have to use the investment fund from the capital source mentioned above strictly according to the regime and with the original vouchers so that the Belgian side can check when requested.

- The expenditures for the project from the part of the capital allocated by the Reciprocal Fund may be audited by an independent audit company (if the Belgian side so requests).

- The project owner shall have to report the final settlement of expenditures from the fund allocated by the Reciprocal Fund to the Finance and Pricing Service of the province or city, the ministry and the central controlling agency, at the same time send a copy to the Ministry of Finance (the External Financial Relations Department) in order to fill the procedures for settling and debt amortizing with the Belgian side.

III. ORGANIZATION OF IMPLEMENTATION:

This Circular takes effect 15 days after its signing.

In the course of implementation if any difficulty arises, the project owners, the People’s Committees of the provinces and cities, the ministries and central controlling agencies should promptly report to the Ministry of Finance for settlement.