Most of such loans are from foreign invested companies, especially large-scale FDI companies, accounting for 76% of total foreign debt incurred by enterprises in Vietnam.
Corporate loans made up 48.4% of Vietnam’s foreign debt in 2018, significantly higher than the rate of 25.6% in 2011 and 40.4% in 2016, according to Deputy Prime Minister Vuong Dinh Hue.
Most of such loans are from foreign invested companies, especially large scale FDI companies, accounting for 76% of total foreign debt incurred by enterprises in Vietnam, Hue said at a meeting on August 9 discussing Vietnam’s foreign debt situation in the 2011 – 2018 period.
On the contrary, external debt incurred by the government is fast declining, Hue noted.
Meanwhile, the ratio of repayment to trade and service turnover was estimated at 25%, meeting international regulations and requirements.
An increase in foreign debt has met capital needs for socio-economic development and higher growth rate, but also impacts the repayment capability of the country, Hue added.
To ensure the safety limit of public and foreign debts, as well as the stability of the macro-economy, Hue requested government agencies to tighten debt management in compliance with the current regulation.
Additionally, Hue expected the Ministry of Planning and Investment to make a comprehensive assessment on foreign investment, especially large-scale FDI projects and the impact of foreign debts on the country’s economic growth target.
As of the end of 2017, Vietnam’s foreign debt to GDP reached 48.9%, fast approaching the threshold of 50% set by the National Assembly. A year later, this figure declined to 46%, of which debts of the government accounted for 19.3% of GDP, government-guaranteed debt 4.4% and corporate debt 22.3%.
In 2018, the Vietnamese government set the limit for government-guaranteed debt of US$700 million, however, no project has been qualified for the loan as the government shifts its priority to lending from domestic source with better interest rate.
Illustrative photo.
|
On the contrary, external debt incurred by the government is fast declining, Hue noted.
Meanwhile, the ratio of repayment to trade and service turnover was estimated at 25%, meeting international regulations and requirements.
An increase in foreign debt has met capital needs for socio-economic development and higher growth rate, but also impacts the repayment capability of the country, Hue added.
To ensure the safety limit of public and foreign debts, as well as the stability of the macro-economy, Hue requested government agencies to tighten debt management in compliance with the current regulation.
Additionally, Hue expected the Ministry of Planning and Investment to make a comprehensive assessment on foreign investment, especially large-scale FDI projects and the impact of foreign debts on the country’s economic growth target.
As of the end of 2017, Vietnam’s foreign debt to GDP reached 48.9%, fast approaching the threshold of 50% set by the National Assembly. A year later, this figure declined to 46%, of which debts of the government accounted for 19.3% of GDP, government-guaranteed debt 4.4% and corporate debt 22.3%.
In 2018, the Vietnamese government set the limit for government-guaranteed debt of US$700 million, however, no project has been qualified for the loan as the government shifts its priority to lending from domestic source with better interest rate.
Other News
- 3,400 taels of gold purchased at the first-in-11-year auction
- HoSE to launch KRX-developed transaction system in early May
- Central bank moves gold auction to tomorrow
- Vietnam’s c.bank sells USD to stabilize exchange rate
- Central bank to auction gold to calm domestic market
- Vietnam's Central Bank ready to steady foreign exchange market
- Finance ministry clears bottlenecks to pave way for stock market upgrade
- Over 60% of Vietnamese use QR codes to pay
- Casinos contribute US$370 million to state budget over 5 years
- Standard Chartered and IATA partner to launch IATA Pay in Vietnam
Trending
-
Hanoi, UNESCO pledge further cooperation
-
Vietnam news in brief - April 25
-
Vietnamese contemporary ballet celebrates Europe Day
-
Capital Law revision helps Hanoi promote role as nation’s socio-economic hub
-
IT training urged to focus on semiconductors
-
Voluntary social security should cover larger part of informal sector: Experts
-
ASEAN Future Forum 2024: Promoting regional centrality
-
Central bank moves gold auction to tomorrow
-
[Video]Hanoi beauty spots featured in saxophone legend Kenny G's music video