Making a breakthrough in public debt management

	Publicity and transparency to improve the efficiency of public debt management
	Improve the effectiveness of public debt management: Be careful of mobilization of capital, borrowing, controlling of allocation
	MoF responsible for public debt management: NASC

Minister of Finance Dinh Tien Dung stated at the conference.

Public debt reaching 61.3% of GDP

According to the report of Department of Debt Management, in 2017 the Department has successfully accomplished 3 targets set out including drastically deploying of Politburo‘s Resolution 07/NQ-TW on policies and solutions to restructure the State budget and public debt management to ensure a secure and sustainable finance; Successfully developing and submitting to the National Assembly to issue Revised Law on Public debt management; Promoting reforms and preparation for changing of public debt management in the new context and situation.

Mr. Hoang Hai – Deputy Director of Debt Management added that in 2017, public debt was controlled successfully in safety limits. As of 31st December 2017, Vietnam’s public debt was VND 3,068, 766 billion, equivalent to 61.3% of GDP and lower than 2016 (63.6%). In order to achieve this result, Department of Debt management reviewed and updated Public Debt Management Strategy for 2016-2020 and Vision 2030 in accordance with the new situation; developed medium-term debt management program for 2018-2020; Plan for public debt payment and loan 2017 towards strengthening management and controlling public debt.

In addition, strictly controlling each factor affecting the increase of public debt such as each capital source mobilized, each disbursement under plan, risk in using, re-borrowing or capital guaranteed by the Government for prompt submission to competent authorities for handling, studying and developing to apply the registration of loans for ministries, sectors and localities and project owners to have basis for controlling public debts right from the time of proposing investment projects and initially evaluating the impact of each loan.

For the capital mobilization, in 2017, 32 agreements for foreign loans with the value of US$ 2,983 million were negotiated and signed. The Department of debt Management also implemented the policy of increasing re-lending with 17 contracts with value about US $ 2,294 million, twice the amount in 2016.

Mr. Hoang Hai stated that the graduation from IDA (World Bank’ preferential loan) since 1st July 2017 suffered great pressures from foreign donors in increasing costs of loans and from ministries, sectors and localities and domestic project owners in accepting the increase of loan costs due to investment demand. For this situation, Department of Debt Management actively and persistently negotiated with the donors to make the most of the remaining ODA resources; drastically negotiated to gain preferential capital and reasonable costs; resolutely refused loans with high cost and consulted the Ministry of Finance to report the Government to change into domestic loans with cheaper costs for capital recovery projects.

Improving officers’ qualification

Monitoring performance of the Department of Debt Management in 2017, Deputy Minister of Finance Tran Xuan Ha said that debt management faced many difficulties, both subjective and objective.

The public debt ratio has fallen, but it still has potentials of increase; debt payment pressure on state budget after graduation from IDA; The capital market is developing well but not stable; some projects still face difficulties in capital and finance and have potential risks.

According to the Deputy Minister, the Department of Debt management needs to carefully assess these difficulties in the coming year to take solutions for removal, thereby, ensuring sustainable debt management.

At the conference, Minister of Finance Dinh Tien Dung recorded and praised efforts of all officers and staff of the Department in the year.

The Minister said that the Department contributed significantly to bring Vietnam’s public debt in 2017 within safety limits; proposed, developed and submitted to the Ministry, the Government and the National Assembly to promulgate the revised Law on public debt management, and especially performed the task of restructuring public debt well.

However, the task of public debt management in 2018 is extremely difficult. Thereby, the Minister Dinh Tien Dung emphasized some solution groups.

Firstly, requesting the Department of Debt management to coordinate with the Department of State budget and relevant units to study and take measures to resolve the increase of public debt and weak sustainability, in which making a plan to pay original debts. Besides, continuing to implement debt restructuring, making real breakthroughs in management and effective use of public debts, and determining mobilizing capital.

Continue to consult about the draft amended Law on Public Debt Management VCN- On 1st August 2017, in Vinh Phuc province, the Ministry of Finance in collaboration with the National Assembly's State Budget and Finance ...

For the deployment of revised Law on Public Debt, the Minister requested Department of Debt management and relevant departments to urgently develop and submit to issue guideline documents in accordance with process and time and actively propagandize.

Most importantly, in order to receive new tasks under the new Law, the Department needs to strengthen relationships with units in and outside the Ministry; To restructure the apparatus in the direction of not increasing the workforce but completing the functions and tasks; To strengthen training and improving the qualifications of officers.