Vietnam’s public debt decreases significantly
Vietnam’s public debt in the 2017-2021 period decreased dramatically from 61.4% of its GDP to 43.1%, according to the latest information released by the Ministry of Finance.
Government debt, government-guaranteed debt and local government debt also decreased. Specifically, government debt, government-guaranteed debt and local government debt dropped from 51.7%, 9.1%, and 1.1% of GDP in 2017 to 39.1%, 3.8% and 0.6% in 2021, respectively.
In addition, the country’s foreign debt also decreased to 38.4% of GDP by the end of 2021 compared to 49% in 2017.
As of 2021, the country’s obligation of foreign debt repayment on total exports last year was 6.2%, while the government’s debt repayment obligation compared to state budget revenue was about 21.8%.
Notably, foreign debt decreased while domestic debt increased. By the end of 2021, foreign debt was about 1.075 quadrillion VND (45.9 billion USD), while domestic debt rose to more than 2.2 quadrillion VND, accounting for 67.2% of outstanding government debt.
The Ministry of Finance’s report showed that by 2021, Vietnam’s largest bilateral creditor was Japan with more than 316 trillion VND, followed by the Republic of Korea (32 trillion VND), France (30 trillion VND) and Germany (14 trillion VND).
Meanwhile, the World Bank was the biggest multilateral lender of Vietnam with over 380 trillion VND, followed by the Asian Development Bank with 188 trillion VND.
In April, Deputy Prime Minister Le Minh Khai signed a decision approving the public debt strategy until 2030, which sets a target of keeping it at under 60% of the GDP and Government debt not exceeding 50% of the GDP in 2030./.