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Vietnam's public debt dropped to its lowest level since 2015

Monday - 20/05/2019 21:02
The Ministry of Finance expects 2018 public debt at 58.4% of GDP, equivalent to VND 3.2 million, the lowest level since 2015.
In the report to the National Assembly, the Ministry of Finance issued figures on debt indicators by the end of 2018 based on the implementation of loan plans, debt repayment and debt limits. Accordingly, public debt has fallen to less than 60% of GDP, at 58.4% of GDP and also the lowest level in the past 3 years. This result is also lower than the public debt scenario at 63.9% of GDP that the Ministry of Planning and Investment issued in August 2018 and in Resolution 01 of the Government.

With the economic scale in 2018 about 5.5 million billion dong, public debt is at 3.2 million billion. Thus, on average, each Vietnamese citizen bears more than VND 32 million of public debt in 2018.

Referring to public debt at the socio-economic group discussion session on October 24, 2018, Finance Minister Dinh Tien Dung said "feeling much softer than 2-3 years ago although the scale increased but debt pressure has decreased ". Mr. Dung said that restructuring public debt is on the right track to reduce foreign debt and increase domestic debt.

In addition to public debt, according to the Ministry of Finance, 2018 Government debt is at 50% of GDP, Government guaranteed debt is 7.9% of GDP, national debt of 46% of GDP. Local government debt is about 0.5% of GDP. If adding loans on re-lending and Development Bank loans, this debt ratio is about 0.9% of GDP. These debt targets are within the allowable limits.

The Ministry of Finance said it has launched a series of "tightening" measures on public debt management. For example, with the Government debt, this agency adjusted the structure and volume of loans in accordance with the demand for capital and market conditions. This agency has actively reduced the volume of Government bond issuance in 2018 in the context of fluctuating monetary and forex markets. On the other hand, the average term of Government bonds is also longer, at 12.7 years. More than 90% of bonds are mobilized for ten years or more. Government bond maturities are long while interest rates drop, helping debt repayment obligations decrease.

With ODA loans, foreign incentives, the Ministry of Finance proactively reviewed and publicized information on donor's ODA, preferential loan conditions, the possibility of conditions for re-lending ODA loans ... as a basis for ministries, branches, localities, project owners and enterprises to propose new projects.

In addition, the debt safety control of the local government is carried out through the national pocket management agency, from comments and suggestions on the use of ODA / government preferential loans to the appraisal stage. re-lending and disbursing foreign loans for approved projects. However, the report of the Ministry of Finance affirmed, "definitely the loan for re-lending is not used for inefficient investment projects or the field of Vietnam has mastered the technology".

Author: Translated by CoPhieuViet.Com

Source: Vnexpress newspaper

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