Vietnam is expected to borrow nearly VND970 trillion (US$37 billion) this year, almost 20% higher than the level set in last year’s plan, as the government moves to balance financing needs with debt safety.
Of the total planned borrowing, around 60% will be used to cover the State budget deficit while the remainder will go towards principal debt repayment, according to the public borrowing and debt repayment plan for this year recently accounced by the Ministry of Finance.
The main funding source this year will be domestic government bond issuance, with an estimated volume of VND500 trillion to be raised through auctions at the Hanoi Stock Exchange. This is expected to help ensure proactiveness and stability in the domestic capital market.
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An employee counts Vietnamese banknotes at a bank. Photo by VnExpress/Thanh Tung |
Regarding debt obligations, total repayments are estimated at over VND530 trillion this year, including more than VND490 trillion in direct government debt repayments, with the remainder allocated to on-lending obligations.
The Ministry of Finance said public debt safety indicators are projected to remain within permitted thresholds and well below statutory ceilings.
For instance, the public debt-to-GDP ratio is estimated at around 35–36%, significantly lower than the 60% ceiling, while government debt-to-GDP is projected at 33–34% compared with the 50% cap.
Direct government debt repayment obligations are expected to account for 20–21% of State budget revenue, below the 25% warning threshold.
In addition, the debt portfolio remains well managed, with an average maturity of 9.1 years and a weighted average interest rate of around 3.1%, reflecting overall safety and sustainability in public debt management.
According to the Ministry of Finance, the annual disclosure of the public borrowing and debt repayment plan helps the country align more closely with international best practices in debt management.
