Foreign debts under Government’s control: Deputy PM

10:37 | 13/08/2019 Economy

The Government’s foreign debts have been declining sharply and under the Government’s control, Deputy Prime Minister Vuong Dinh Hue said while chairing a meeting with leaders of some ministries, sectors and the National Financial Supervisory Commission in Hanoi on August 9.

Deputy Prime Minister Vuong Dinh Hue speaks at the meeting - Photo: VGP

The Ministry of Finance reported that in the 2011-2017 period, Vietnam’s foreign debts averagely increased by 16.7% per year.

The country’s foreign debts reduced to 46% of its gross domestic product (GDP) by the end of 2018 from 48.9% a year earlier.

The ratio of debt repayment to total import and export turnover was about 25%, meeting international regulations and practices.

With the aforesaid outcomes, Hue affirmed that the country’s foreign debts are still below the ceiling rate of 50% set by the National Assembly and under the Government’s control.

The Deputy PM asked ministries and related sectors to strengthen management of foreign debts according to legal regulations, including the law on public debt management, and resolutions of the NA and Government on public debts to ensure the capital demand of the economy in general as well as the rights and obligations of enterprises.

He assigned the Ministry of Finance and the State Bank of Vietnam to coordinate with relevant ministries to better the law on self-repayment debt management of enterprises and focus on supervising the total debts and debt structure as well as take into account risks for each business, in accordance with international practices.

The Ministry of Planning and Investment was tasked to review and evaluate the overall foreign investment, especially large-scale projects, and the impacts of foreign loan conditions on FDI growth and attraction.

According to the Ministry of Finance, in the first six months of 2019, the total corporate bond issuance exceeded VND116 trillion (US$4.98 billion), a year-on-year rise of 7.4%. Of which, VND36.7 trillion were issued by commercial banks (making up 36%) and real estate firms VND22.12 trillion (19%). The remainders were issued by stock companies, 3.5%, and other businesses.

As of June, the capitalisation of the corporate bond market was equivalent to 10.22% of the GDP, surpassing the set target of 7% in 2020.