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The Public Debt Strategy Project by 2030 is one of the nine strategies in the finance sector’s strategic system which has been approved by the Prime Minister, and is an important basis to continue reforming public debt management in a sustainable and effective manner, ensuring debt safety and national financial security, said Deputy Minister of Finance Ta Anh Tuan at the workshop on Public Debt Strategy Project by 2030.
Towards enhancing macro stability, supporting the economy, promoting investment
The dissemination workshop on public debt strategy by 2030 was jointly held by the Ministry of Finance and the World Bank and the Swiss Federal Department of Economic Affairs on June 20 and 21 with the participation of representatives of ministries, Government agencies, National Assembly agencies, local People's Committees and Departments of Finance, representatives of international organizations World Bank, International Monetary Fund (IMF), businesses and commercial banks. Deputy Minister of Finance Ta Anh Tuan attended and chaired this important workshop.
Within the framework of the workshop, Session I took place with the topic of Overview and orientation of mobilizing and using loans until 2030.
At the workshop, Deputy Minister Ta Anh Tuan said that the 10-year socio-economic development strategy for the 2021-2030 period, approved by the 13th Party Congress, demonstrates the Party's vision for the country's socio-economic development policy in the new period.
To contribute to succeeding in the Socio-Economic Development Strategy for the 2021-2030 period, the Prime Minister issued Decision 460/QD-TTg dated April 14, 2022 approving the Public Debt Strategy by 2030, this has great significance.
“This is one of the nine strategies in the financial sector’s strategic system approved by the Prime Minister and an important basis to continue reforming public debt management in a sustainable and effective manner, ensuring debt safety and national financial security," said Deputy Minister Ta Anh Tuan.
The public debt strategy is built on the basis of the Socio-Economic Development Strategy for the 2021-2030 period, the Party's major policies and orientations, and the National Assembly's Resolution on the Socio-Economic Development Plan, National financial plan and borrowing and repayment of public debt, five-year medium-term public investment plan for the 2021-2025 period.
Accordingly, the strategy set goals such as GDP growth rate is averaged at about 7%/year; GDP per capita by 2030 will reach about US$7,500; state budget deficit is about 3% of GDP by 2030.
According to the Deputy Minister, the Public Debt Strategy has inherited the active role of the public debt management policy in the past, contributing to enhancing macro stability, supporting the economy, promoting investment and development for socio-economic infrastructure, and strengthening discipline in finance and state budget field.
Public debt strategy by 2030 - a very ambitious program
Speaking at the workshop, Ms. Carolyn Turk, World Bank Country Director for Vietnam, highly appreciated the Ministry of Finance for directing the development of the public debt strategy by 2030.
“We recognize the Public Debt Strategy by 2030 as a very ambitious program in terms of both fiscal policy and debt management, which defines the overall fiscal framework through debt limits and budget, and guides and orients the government's spending and borrowing activities.”
The Public Debt Strategy by 2030 sets out a number of key points and objectives in public debt management.
The Strategy closely follows Resolution 07-NQ/TW of the Politburo on policies and solutions to restructure the state budget and manage public debt to ensure a safe and sustainable national finance; strengthen the management of finance, state budget and public debt according to the medium-term plan; improve the efficiency of loan use; ensure debt repayment capacity, proactively restructure debt portfolio and enhance digital transformation in public debt management.
In terms of goals, by 2030, the public debt should not exceed 60% of GDP, the Government debt should not exceed 50% of GDP, the country's foreign debt should not exceed 45% of GDP, the Government's direct debt repayment obligation should not exceed more than 50% of GDP and the debt repayment liability of the Government should not exceed 25% of total state budget revenue.
In addition, the Public Debt Strategy also sets out six major orientations in mobilizing and using loan capital, eight groups of tasks and solutions to implement the Strategy, focusing on perfecting the instructions and policies and tools for debt management; developing modern tools and methods for debt management; effectively mobilizing and using loan capital; developing domestic financial market and capital market; managing contingency debt obligation; developing organizational structure and applying information and technology; conducting inspection and supervision and disclosing information.
According to the organizers of the workshop, in the context of the global economy with many challenges and profound impacts on the recovery and growth of the domestic economy, agencies, organizations and localities should study and make detailed plans and roadmaps for each target, assign specific tasks to each agency, organization, and locality, offer solutions to mobilize, manage and use using loan capital to implement the Public Debt Strategy by 2030 effectively
“In the 2016-2020 period, the average state budget deficit was controlled at about 3.45% of GDP, ensuring the targets of the Debt Strategy. The state budget deficit was below 4% of GDP by 2020 according to Resolution 07-NQ/TW of the Politburo, and no more than 3.9% of GDP according to Resolution 25/2016/QH14 of the National Assembly.
Five of six targets of public debts are ensured within allowable limits, of which public debt (including government debt, government-guaranteed debt and local government debt) was about 55.9% of GDP by the end of 2020, within the limit of no more than 65% of GDP".
Source: Customs News