The Vietnamese Government is scheduled to pay the debt of VND335.8 trillion (US$14.6 billion) this year, 89% of which is principals and the remaining are for on-lent loans.

The Government’s debt repayment accounted for 23% of budget revenue. Photo: Pham Hung

The figure, a decline of VND30 trillion ($1.3 billion) compared to last year, was mentioned in the Government’s program for public debt management for the 2022-2024 period.

“The objective is to ensure sufficient capital for the Government to carry out its socio-economic recovery packages,” the program stated.

Under the program, the Government would borrow a maximum of VND673.5 trillion ($29.3 billion) this year, an increase of VND160 trillion ($7 billion) against 2021. Upon breaking down, 96% of the loans, or VND647 trillion, are to cover the budget deficit and nearly VND27 trillion for on-lent loans.

The program noted the amount is expected to mobilize from Government bonds, ODA, and preferential loans from abroad.

“In case of necessity, the Government may consider issuing Government bonds and selling to the State Bank of Vietnam,” it added.

In 2021, all major debt indicators continued to stay within the limit set by the National Assembly, in which the ratio of public debt to GDP stood at 43.7%, that of Government debt to GDP at 39.5%, and foreign debt to GDP at 39%.

The Government’s debt repayment accounted for 23% of budget revenue, below the 25% threshold.

This year, local provinces/cities would borrow a total of VND28.6 trillion ($1.2 billion) and pay VND6.1 trillion ($266.4 million) in debts.

The Government would guarantee a maximum loan of VND20.4 trillion ($891 million) for the Vietnam Bank for Social Policies. The disbursement of such an amount, if not fully carried out this year, could be extended for next year.

Meanwhile, the Government said it would not guarantee commercial loans, according to which enterprises are responsible for their own payments, with a maximum of $7.3 billion.

Under the plan, the Government’s total loans in the 2022-2024 period would be around VND2,000 trillion ($87.4 billion).

The Government would pay debts of over VND1.100 trillion ($48 billion) for the upcoming three years, including VND971 trillion of the direct debt payment.