Connect with us

Business

Keeping public debt below 60 per cent of GDP by 2030 targeted

Published

on

 

A public debt strategy is important to ensuring debt safety, national financial security and promoting socio-economic development. — Photo moit.gov.vn

HÀ NỘI — Việt Nam is targeting to control public debt below 60 per cent of gross domestic product (GDP) by 2030 to ensure debt safety and national financial security.

The goal was highlighted in the public debt strategy by 2030.

Deputy Minister of Finance Tạ Anh Tuấn said yesterday at a two-day workshop held in Thanh Hoá that the public debt strategy issued on April 14 played an important role in the socio-economic development in the 2021-30 period, which serves as an important basis for continuing sustainable and efficient public reform management and ensuring debt safety and national financial security.

Under the strategy, public debt would not exceed 60 per cent, government debt 50 per cent and foreign debt 45 per cent of GDP, and the amount for debt repayment would not exceed 25 per cent of the total budget revenue.

The strategy targeted that GDP would expand at an average of seven per cent per year with GDP per capita reaching US$7,500 by 2030 and a budget deficit at around three per cent of GDP.

The ministry’s statistics showed that public debt expansion decreased from an average of 18.1 per cent per year in the 2011-2015 period to 6.7 per cent in 2016-20. Public debt was at 55.9 per cent of unrevised GDP by the end of 2020, compared to the peak of 63.7 per cent in 2016, and 43.1 per cent of revised GDP by the end of 2021.

The structure of public debt had been adjusted in a more sustainable direction with the percentage of external debts falling from 61 per cent of the Government’s total debt in 2011 to 33 per cent in 2021.

Debt repayment was always guaranteed on time, which contributed to improving the country’s credit rating as S&P recently announced to raise Việt Nam’s national credit rating from BB to BB+ with a stable outlook and increasing the fiscal room to strengthen the economy’s resilience to macro shocks, the ministry said.

According to Carolyn Turk, World Bank director for Việt Nam, Việt Nam’s public debt strategy for 2030 was very important because it related to both fiscal policies as well as public debt management. The strategy also guided the Government’s borrowing activities after Việt Nam become a middle-income country with the goal of becoming a high-income country by the end of 2045, which would require a huge investment in infrastructure to maintain economic growth of an average of 5-6 per cent per year in the next 20 years.

She said that attention should be paid to improving the efficiency of local government debt management, pointing out that Việt Nam had not yet developed a medium-term local government debt management strategy and had not assessed risks before borrowing.

Trương Hùng Long, director of the ministry’s Department for Debt Management and External Finance, said that Việt Nam had graduated from IDA, the World Bank’s concessional finance window, meaning that the country no longer had access to high-preferential capitals as before and Việt Nam would have to rely more on market tools to raise capitals.

Therefore, it is important to have prudent and flexible medium and long-term borrowing and debt payment strategies to limit negative long-term consequences, Long said, adding that shocks like the COVID-19 pandemic always required reserve finance in the short and medium terms.

According to the strategy, the focus would be on enhancing and strengthening the management of finance, budget and public debt, improving the efficiency of loan use, ensuring debt repayment capacity and restructuring debt portfolio as well as enhancing digital transformation in public debt management. —

 

Source: https://vietnamnews.vn/economy/1252224/keeping-public-debt-below-60-per-cent-of-gdp-by-2030-targeted.html

Business

Vietnam’s 2022 economic growth projected at 7%

Vietnam’s GDP is likely to expand by around 7 percent in 2022, much higher than 2.58 percent growth of 2021.

Published

on

Minister of Planning and Investment Nguyen Chi Dung made the above statement at the Cabinet meeting in Hanoi on July 4.

With this scenario, the economy needs to expand 9 percent in the third quarter and 6.3 percent in the last quarter this year, the minister said.

In the first half, the Southeast Asian country’s GDP accelerated to 6.42 percent growth compared to the optimistic scenario of 5,1-5,7 percent as figured out in the Government’s Resolution No. 01/NQ-CP, dated January 01, 2021 on major tasks and solutions for implementation of socio – economic development plan and state budget estimate for 2022. 

Especially, the GDP grew 7.72 percent in the second quarter, which is the fastest growth pace for April-June period since 2011.

Earlier, the World Bank predicted Vietnam’s 2022 GDP growth at 5.5 percent if the COVID-19 pandemic is controlled.

The projection is lower than the Vietnamese Government’s predictions at 6.5-7 percent, HSBC at 6.5 percent and Standard Chartered at 6.7 percent.

Source: https://e.nhipcaudautu.vn/economy/vietnams-2022-economic-growth-projected-at-7-3346528/

Continue Reading

Business

Dragon Capital buys 2.1 million shares of Sacombank

Asset management company Dragon Capital has bought 2.1 million shares of HCMC-based Sacombank, increasing its stake in the bank to 6.09 percent.

Published

on

On June 29, two affiliated funds, CTBC Vietnam Equity Fund and Norges Bank, bought 2.3 million shares of the lender while a third, Samsung Vietnam Securities Master Investment Trust, sold 200,000 shares.

The value of the deal is estimated at VND47.5 billion (US$2.03 million) based on the share’s closing price last Wednesday.

Funds under Dragon Capital own 114.8 million shares or a 6.09 percent stake in the bank.

In March, Dragon Capital had raised its stake from 4.98 percent to 5.05 percent, after its largest fund, Vietnam Enterprise Investment Limited, bought 1.25 million shares.

Source: VnExpress

Source: https://e.nhipcaudautu.vn/companies/dragon-capital-buys-21-million-shares-of-sacombank-3346515/

Continue Reading

Business

Vietnam targets 7% GDP growth this year: minister

Published

on

HANOI — Vietnam is aiming for economic growth of 7% this year, the country’s planning and investment minister said on Monday, higher than an official target of 6.0%-6.5% set previously.

To achieve this, year-on-year economic growth in the third quarter needs to be 9.0% and in the fourth quarter 6.3%, minister Nguyen Chi Dung also said during a government meeting.

Dung said Vietnam’s budget was in surplus, giving scope for fiscal policy to be used to support businesses and residents.

“Credit institutions will need to further cut their lending interest rates to reduce input cost pressure for businesses and for the economy,” he said.

Vietnam, a regional manufacturing hub, started lifting its coronavirus curbs late last year, allowing factories to resume full operations.

The economy is recovering after growing only 2.58% last year, the slowest pace in decades.

The Southeast Asian country reported GDP growth of 7.72% in the second quarter, backed by strong export growth, but warned of upward inflation pressure for the rest of the year. 

Source: https://tuoitrenews.vn/news/business/20220704/vietnam-targets-7-gdp-growth-this-year-minister/67932.html

Continue Reading

Trending