May 4, 2012

Vietnam - Vietnam's public debts increasing sharply


It is expected that Vietnam's public debts would be equal to about 58.4 percent of gross domestic product (GDP) by the end of 2012, and 65 percent of GDP by 2015, the local newswire Phat Luat TP HCM reported citing some specialists as saying at the conference on restructuring public investment and state-owned enterprises (SOEs) held by Vietnam Institute of Economics on May 3 in Hanoi.

According to the statistics from the Ministry of Finance (MoF) cited by economist Vu Dinh Anh, as of the end of 2011, the country's public debts accounted for 54.6 percent of GDP, equalling to $50 billion.

It is estimated that by the end of 2012, Vietnam's public debts would be about 58.4 percent of GDP and it would be 65 percent of GDP by 2015.

As forecasted by International Monetary Fund (IMF), by 2015, Vietnam's public debts would be about $86.2 billion.

Anh said that Vietnam's public investments account for high proportion in the total social investment capital. The investment capital ratio from the State budget accounted for more than 50 percent during 2005-2009 period and 2011.

To complete projects, Vietnam mostly has to borrow domestic and foreign capital sources and therefore the state budget is facing a spiral of debt with increasing debt scale. And added that this is a barrier for growth and more importantly Vietnam now has no agency that is responsible for public debt management.

VietBiz24



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