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Saturday, June 15, 2024

Public debt to be maintained at 60% of GDP by 2030

By Van Phong

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HCMC – The Government has set a target to keep the public debt cap at 60% of the country’s gross domestic product (GDP) by 2030.

In addition, the Government’s debt should not exceed half of the GDP, according to a decision signed by Deputy Prime Minister Le Minh Khai approving the public debt strategy by 2030.

In the 2021-2025 period, the Government looked to control the State budget overspending as approved by the National Assembly in the State budget collection and spending plan and the national financial plan in the five-year period.

By 2030, the country’s foreign debt was targeted not to exceed 45% of the GDP.

To reach these targets, the Government will regularly assess the impact of loans on public debt, the Government’s debt and the debt payment obligation, and maintain the State budget overspending and the capital sourced from the State budget for the debt payment within the approved caps.

The Government will also issue bonds, mainly those with a term of five years and above, and sovereign bonds in the local market to meet the capital mobilization demand and develop the Government bond market.

Sovereign bond issues to compensate for the budget deficit, restructure Government debt and fund development projects will be implemented when conditions are favorable.

With official development assistance and foreign preferential loans until the end of 2020, the Government required new loans to be offered to key sectors to improve the capital effectiveness, specifically those promoting sustainable development, such as those on climate change adaption, environment quality improvement, education, healthcare and technology.

In addition, some public investment programs will be developed to execute important projects and address national and regional development and regional connectivity issues.

The Government will also manage loans under its guarantee in line with the law and focus on providing the guarantee for loans for key national projects approved by the National Assembly and the Government.

Local enterprises’ and credit institutions’ foreign loans will be controlled to remain within the limit. The Government will also improve regulations to control foreign loans in line with international practices.

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