Public debt pressure eases in Vietnam: Minister

By Staff reporters   December 29, 2017 | 05:05 pm GMT+7
Public debt pressure eases in Vietnam: Minister
Workers are seen at a construction site in Hanoi, Vietnam May 25, 2017. Photo by Reuters/Kham

Public debt will only rise by an estimated 9 percent this year compared to 15 percent last year.

Vietnam is expecting to beat its state budget collection target by 5 percent this year, easing the pressure caused by the country’s public debt, Minister of Finance Dinh Tien Dung said at a government meeting on Friday.

The additional funding pouring into the state coffers has mainly come from land use fees, he said.

The legislative National Assembly (NA) late last year set a target of collecting VND1,212 trillion ($53.45 billion) for the state budget in 2017. Legislators also set a spending limit for this year of VND1,390 trillion ($61.3 billion).

At a NA session last month, Dung said Vietnam’s public debt growth has slowed and will only rise by an estimated 9 percent this year compared to 15 percent last year.

“Public debt has been closely controlled, and this is demonstrated by lower year-on growth,” he added.

Vietnam’s national debt had reached more than VND2,600 trillion ($116 billion) as of the end of 2015, equal to 62.2 percent of gross domestic product (GDP), said the country's Finance and Budget Commission in a report on the country’s debts and obligations for 2016-2020.

The government has gradually cut state budget overspending, aiming to ensure public debt safety, he said.

The government has set a target of keeping state budget overspending at 3.5 percent in 2017, 3.7 percent in 2018, 3.6 percent in 2019 and 3 percent in 2020.

The World Bank forecasts that Vietnam’s public debt will climb to 63.8 percent of GDP this year and 64.4 percent next year.