Under the proposal, Ho Chi Minh City suggests allocating up to VND1.8 trillion ($70.8 million) from the municipal budget between 2027 and 2035, aiming to elevate the fund's total charter capital to VND5 trillion ($196.8 million).
At a review meeting for three draft resolutions submitted by the Ho Chi Minh City People’s Committee on October 28, the Economic and Budget Committee of the municipal People’s Council examined proposals related to local government bond issuance, domestic financial institution loans, and charter capital supplementation for the city's Venture Capital Fund.
Combining public capital with private investment
Regarding the draft resolution on capital supplementation for the fund, Mr. Tran Trong Tuyen, Deputy Director of the Ho Chi Minh City Department of Science and Technology, reported on the rationale, capital increase roadmap, and coordination mechanisms between public funds and private capital.
According to the submission dossier, the Ho Chi Minh City Venture Capital Fund Joint Stock Company's business registration certificate was issued on April 10, with an initial charter capital of VND500 billion ($19.68 million), of which private capital accounted for VND300 billion ($11.8 million), or 60 percent.
The municipal People’s Committee proposed an additional state budget contribution of up to VND200 billion ($7.87 million) annually, with total state supplementation capped at VND1.8 trillion ($70.8 million) for the 2027-2035 period.
Combined with the initial state capital of VND200 billion ($7.87 million), total state contributions to the fund by 2035 will reach a maximum of VND2 trillion ($78.7 million), aligning with the target of expanding total charter capital to at least VND5 trillion ($196.8 million).
The proposal specifies that state capital allocations will be tied to private capital mobilization outcomes. If private capital raising falls short of targets, state contributions will be calculated on a matching ratio basis. Conversely, if private capital exceeds expectations, annual state budget additions will remain capped at VND200 billion ($7.87 million).
Delegates noted that capital allocation must be considered within the broader context of resources dedicated to science, technology, and innovation, alongside governance mechanisms, portfolio evaluation methods, and risk control frameworks for venture capital investments.
During the meeting, the Department of Finance presented draft resolution details regarding the issuance of municipal bonds, project bonds, construction bonds, urban bonds, green bonds, and loans from domestic financial institutions to fund local development projects.
In the 2026-2030 period, the city foresees maximum domestic borrowings of VND49.29 trillion ($1.94 billion) to cover budget deficits. This includes VND17.55 trillion ($690.9 million) on-lent from Government borrowings and VND31.73 trillion ($1.25 billion) raised domestically, primarily via municipal bond issuances.
The draft resolution aims to diversify financing tools to meet investment demands for urban railways, transport infrastructure, regional connectivity projects, environment, and digital transformation.
Delegates emphasized matching borrowing plans closely with project implementation capacity to prevent unnecessary capital costs.
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