World Bank committees to support Vietnam Government in economic reform process

Both parties take photos after the working session.

Speaking at the ceremony, Minister Dinh Tien Dung thanked World Bank (WB) for their cooperation and support to Vietnam Government as well as Ministry of Finance. Through that, it contributes importantly to Vietnam’s socio-economic development over previous years.

World Bank has also provided the Ministry of Finance (MOF) with technical assistance to improve the capacity of public finance management, debt management, and impact assessment. The MOF affirmed that they will implement the project which using the capital of the WB in a practical and effective way.

The Minister hoped that WB would continue to provide technical assistance and share more experience to Vietnam in general and to the Ministry of Finance in particular in order to meet requirements of integration in the future.

Discussing on issues related to the use of loans from IBRD and mobilizing other resources into Vietnam's development process, Minister Dinh Tien Dung said that the Government and the Ministry Finance is very concerned about the effectiveness of using funds from foreign organizations, including WB.

According to the World Bank's recommendations, in the current context, Vietnam needs to tighten control over deficit spending and public debt management. On the other hand, Vietnam needs a huge capital to invest in development. Vietnam's public debt is in the allowed ceiling of National assembly's limits, as well as difficulties in public debt framework (domestic debts and foreign debt) in the past, loan terms and basic rates that have been solved.

Moreover, the Minister stressed that: Recently, Vietnam had refused some loans from international financial institutions because interest rates were higher than domestic borrowing. The Minister said that with the development of the domestic government bond market, the mobilization of capital for development investment is necessary but there must be a choice. Therefore, in the coming time, the Ministry of Finance should consider and evaluate the impact of medium-term public investment loans for the period 2016-2020, as well as assess the impact on the loan portfolio, assess the impact of using the loans for local authorities on lending and the repayment capacity of the local government.

In response, Vice President Sandi Okoro congratulated Vietnam for their achievements in economic development over the past time as well as important reforms that Vietnam Government is implementing. On behalf of Senior Vice President and General Counsel for World Bank Group, Ms. Sandi Okoro highly appreciated the close relationship between the World Bank and Vietnam, affirming that the WB is committed to continuing supporting and co-operating with Vietnam Government in the process of economic reform as well as reform of fiscal management and public debt management.

She also said that the WB is adopting a new approach to mobilizing capital for Vietnam, especially in the area of infrastructure development and energy. Thus, Sandi Okoro wishes to share achievements to Vietnam in using this new asymptote.

At the end of the meeting, Minister Dinh Tien Dung emphasized that in the coming time, the demand for mobilizing resources for investment is very large, but the issue of state budget management is very necessary, the criteria should be closely monitored.

Appreciate WB has accompanied with the Government and the Ministry of Finance of Vietnam in mobilizing resources for institutional reform, especially in the financial sector, Minister Dinh Tien Dung expects the WB to continue to support Viet Nam to improve its institutions, manages its budget in a thrifty and efficient way, ensuring national security and safety in the context of international economic integration.