PM: Vietnam targets to control budget deficit, public debt

By    April 21, 2016 | 11:27 pm PT
PM: Vietnam targets to control budget deficit, public debt
Prime Minister Nguyen Xuan Phuc at a working meeting with the Finance Ministry's top officials on April 21, 2016.
Vietnam’s gross domestic product (GDP) in the first quarter of this year is estimated at 5.46 percent, down from 6.12 percent during the same period last year, signaling that the country’s economic growth might be losing momentum, Prime Minister Nguyen Xuan Phuc warned on Thursday at a meeting with senior officials from the Ministry of Finance.

Phuc said that the government’s target growth rate for 2016 is 6.7 percent, but achieving this target will not be an easy task due to several obstacles including widening government spending, a rising budget deficit and soaring public debts.

The Ministry of Finance is responsible for maintaining the budget revenue growth and improving the efficiency of public debt management, the PM said at the meeting.

The Finance Ministry in recent years has advised the government on measures aimed at keeping a balanced budget and making efficient use of public assets to stabilize the macro economy, control annual inflation and maintain economic growth.

According to Phuc, the country is faced with challenges that cannot be dealt with using traditional tools and old mindsets, so the Finance Ministry will have to come up with new ones.

The PM asked the Finance Ministry to step up measures to improve state budget revenue, accelerate privatization of state-owned companies, keep public debt under control and create a favorable business environment to attract foreign investment.

There is an urgent need to reallocate state funds from the central government to local governments since Vietnam will soon find it more difficult to access preferential loans and official development assistance (ODA), especially following the World Bank’s announcement that it will cut its ODA to Vietnam before July 2017.

Phuc also encouraged the socialization of state-run education, health care and other public services so that the number of people on the state payroll can be cut, easing the pressure on the state budget.

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