HCMC — The National Assembly (NA) on November 3 discussed amendments to the Law on Public Debt Management, focusing on oversight of official development assistance (ODA) and foreign concessional loans.
The reviewing committee backed several provisions in the draft, including updated public debt classifications, revised management principles, and expanded authority for the prime minister and the Ministry of Finance. The revisions also aim to increase the autonomy and accountability of local authorities in budget decisions.
The draft adds rules on the allocation and use of ODA. The Government would define cases in which provincial authorities and public service units may receive grant-based support. NA Chairman Tran Thanh Man asked the Government to set strict conditions, grant ratios, and assessments of the impact on the central budget.
Man said provinces may seek higher levels of foreign borrowing, while repayment obligations rest mainly with the central budget. He called for stronger supervision and clearer sanctions to ensure effective use of redistributed loan funds.
The draft also proposes new ODA lending mechanisms. Commercial banks would relend ODA to public service units without assuming credit risk, and relend to businesses investing in priority projects under a partial credit-risk model.
The NA chairman requested a detailed assessment of these proposals. He warned that removing credit-risk responsibility could weaken borrower screening and increase risk exposure for state agencies. He asked lawmakers to clarify commercial banks’ obligations if borrowers default, or assign the Government to issue regulations if the law cannot specify them.
The draft further revises rules on Government guarantees, allowing the Ministry of Finance to rely on assessments from selected credit institutions instead of conducting its own evaluation of applicants’ financial plans.
