Vietnam’s total outstanding public debt was equivalent to 56.3percent and 54.9 percent of its GDP in 2010 and 2011 respectively,according to Bulletin No. 1 recently issued by the Ministry of Finance.
The country’s external debt was equal to 42.2percent of GDP in 2010 and 41.5 percent of GDP the following year.Outstanding Government debts are 44.6 percent and 43.2 percent of GDP.
The Government’s debt obligations were 17.6 percentand 15.6 percent of the annual total State budget collection in 2010 and2011 respectively.
The ministry’s Department ofDebt Management and External Finance said that the 2010 statistics wereadjusted after the National Assembly approved the 2010 State budgetbalance. The statistics for 2011 may be corrected after the year’s Statebudget balance is approved.
According to theStrategy on Public Debt and Foreign Debt in the Period of 2011-2020 andVisions to 2030 issued in 2012, public debt, including Government debt,Government-guaranteed debt and local authority debt must not exceed 65percent of GDP by 2020. The Government’s outstanding debt must notexceed 55 percent of GDP, and national foreign debt not more than 50percent of GDP.
The Government’s direct debt obligations(excluding refunding) must not exceed 25 percent of the annual totalState budget collection, and national foreign debt obligations must bebelow 25 percent of the turnover generated from exporting goods andservices.
With 2011’s public debt of 54.9 percent of GDP, it issaid that the country’s current public debt still meets safety standardsin line with international practices. Reports by the InternationalMonetary Fund (IMF) and the World Bank (WB) estimated that Vietnam’spublic debt was 48.8 percent of GDP in 2012 and will be 58.2 percent in2013.
Under international practices, it isconsidered safe if the Government’s debt obligation is less than 35percent of the total State budget collection. In fact, the rate isbetween 14 and 16 percent. Vietnam’s figure was 15.6 percent in2011, two percent lower than that of the previous year.
Oneof the objectives the Ministry of Finance has paid special attention toin recent years is the safe and sustainable management of public debt.
The strategy states that to meet the great demandfor socio-economic development capital, it is necessary and essential tomobilise domestic and foreign loans, especially when internal sourcesare insufficient.
The mobilisation of loans and debtclearance must be within the safety standards relating to the country’spublic debt, governmental debt and foreign debt in order to guaranteenational financial security.
Domestic and internationalloans can be used to redeem budget overspending so that it is possibleto reduce budget overspending (including governmental bonds) to below4.5 percent of GDP by 2015, around four percent of GDP in the period of2016-2020 and about three percent of GDP after 2020.
Key measures to realise the strategy include perfecting institutions,policies and instruments to manage debt; further improving efficiency ofloan mobilisation and use; closely controlling the grant and managementof Government guaranteed debts; and enhancing supervision andmanagement of risks.
Debt information must be madepublic and transparent through reports. Organisational apparatus shouldbe completed, administrative reforms accelerated, and debt managementagencies modernised for higher efficiency.-VNA
The country’s external debt was equal to 42.2percent of GDP in 2010 and 41.5 percent of GDP the following year.Outstanding Government debts are 44.6 percent and 43.2 percent of GDP.
The Government’s debt obligations were 17.6 percentand 15.6 percent of the annual total State budget collection in 2010 and2011 respectively.
The ministry’s Department ofDebt Management and External Finance said that the 2010 statistics wereadjusted after the National Assembly approved the 2010 State budgetbalance. The statistics for 2011 may be corrected after the year’s Statebudget balance is approved.
According to theStrategy on Public Debt and Foreign Debt in the Period of 2011-2020 andVisions to 2030 issued in 2012, public debt, including Government debt,Government-guaranteed debt and local authority debt must not exceed 65percent of GDP by 2020. The Government’s outstanding debt must notexceed 55 percent of GDP, and national foreign debt not more than 50percent of GDP.
The Government’s direct debt obligations(excluding refunding) must not exceed 25 percent of the annual totalState budget collection, and national foreign debt obligations must bebelow 25 percent of the turnover generated from exporting goods andservices.
With 2011’s public debt of 54.9 percent of GDP, it issaid that the country’s current public debt still meets safety standardsin line with international practices. Reports by the InternationalMonetary Fund (IMF) and the World Bank (WB) estimated that Vietnam’spublic debt was 48.8 percent of GDP in 2012 and will be 58.2 percent in2013.
Under international practices, it isconsidered safe if the Government’s debt obligation is less than 35percent of the total State budget collection. In fact, the rate isbetween 14 and 16 percent. Vietnam’s figure was 15.6 percent in2011, two percent lower than that of the previous year.
Oneof the objectives the Ministry of Finance has paid special attention toin recent years is the safe and sustainable management of public debt.
The strategy states that to meet the great demandfor socio-economic development capital, it is necessary and essential tomobilise domestic and foreign loans, especially when internal sourcesare insufficient.
The mobilisation of loans and debtclearance must be within the safety standards relating to the country’spublic debt, governmental debt and foreign debt in order to guaranteenational financial security.
Domestic and internationalloans can be used to redeem budget overspending so that it is possibleto reduce budget overspending (including governmental bonds) to below4.5 percent of GDP by 2015, around four percent of GDP in the period of2016-2020 and about three percent of GDP after 2020.
Key measures to realise the strategy include perfecting institutions,policies and instruments to manage debt; further improving efficiency ofloan mobilisation and use; closely controlling the grant and managementof Government guaranteed debts; and enhancing supervision andmanagement of risks.
Debt information must be madepublic and transparent through reports. Organisational apparatus shouldbe completed, administrative reforms accelerated, and debt managementagencies modernised for higher efficiency.-VNA
