Public debt borrowing and repayment plan in 2024

The 2024 public debt borrowing and repayment plan and the 3-year public debt management program for the 2024-2026 period aim to ensure resources to fully and timely repay public debts, without affecting the national credit rating; continue to restructure the government bond debt portfolio in accordance with market conditions and implementation needs.

At the same time, ensure the task of mobilizing loans through diversifying capital sources and borrowing methods domestically and internationally to meet the needs of balancing the state budget and socio -economic development with appropriate levels of cost and risk, focusing on prioritizing foreign capital mobilization for large and important projects that are of a situation-changing and status-changing nature.

In addition, strictly control debt safety indicators within the ceiling and warning threshold approved by competent authorities; promote the development of the domestic capital market; and make the most of foreign preferential loans.

**Public debt borrowing and repayment plan in 2024 (*)**

The decision clearly states that the Government's borrowing plan is a maximum of VND676,057 billion, including: Maximum borrowing for balancing the central budget is VND659,934 billion, of which maximum borrowing to cover the central budget deficit is VND372,900 billion; borrowing to repay principal is not more than VND287,034 billion; borrowing for re-lending is about VND16,123 billion.

Flexible mobilization of resources from tools: (i) issuing government bonds; (ii) borrowing ODA, foreign preferential loans; (iii) if necessary, borrowing from other legal financial sources.

Government debt repayment is about 453,990 billion VND, of which direct debt repayment of the Government is not more than 395,874 billion VND, debt repayment of re-lending projects is about 58,116 billion VND.

On government-guaranteed loans

The decision clearly states that the bond issuance guarantee level for the Vietnam Development Bank is a maximum of VND 1,160 billion, equal to the principal repayment of government-guaranteed bonds due in 2024. For the Vietnam Bank for Social Policies, no government-guaranteed bonds will be issued in 2024.

The specific bond issuance guarantee level for the Vietnam Development Bank is determined based on the Ministry of Finance's appraisal of the application for issuance of bonds guaranteed by the Government in accordance with the provisions of Decree No. 91/2018/ND-CP dated June 26, 2018 of the Government on the issuance and management of Government guarantees.

For guarantees for domestic and foreign loans for enterprises, there is no government guarantee limit in 2024 because the projects do not need to withdraw capital, only repay debt.

Local government borrowing and debt repayment plan

The decision clearly states that the loan from the Government's foreign loan re-lending source and other loan sources is about 30,619 billion VND.

Local government debt repayment is about 6,993 billion VND, including principal payment of about 4,119 billion VND and interest payment of about 2,874 billion VND.

Foreign commercial loans of enterprises not guaranteed by the Government in 2024: The limit of medium- and long-term foreign commercial loans of enterprises and credit institutions by self-borrowing and self-repayment is about 6,599 million USD; the growth rate of short-term foreign debt is about 18-20% compared to the outstanding debt as of December 31, 2020. (**)

The Decision clearly states that the 2024 borrowing and debt repayment plan is implemented within the maximum levels stated in (*) and (**); in case of arising demand exceeding the above maximum levels, the Ministry of Finance shall submit to the Prime Minister for adjustment of the plan.

3-year public debt management program for the period 2024-2026

According to the decision, regarding borrowing and debt repayment of the Government, the total borrowing of the Government in the period of 2024-2026 is a maximum of about 1,862.2 trillion VND, of which borrowing for the central budget is about 1,818.3 trillion VND, borrowing for re-lending is about 43.9 trillion VND.

The total debt repayment of the Government in the 2024-2026 period is a maximum of VND 1,102.8 trillion, of which direct debt repayment is about VND 976.4 trillion and re-loan repayment is about VND 126.4 trillion.

Proactively arrange resources to fully fulfill the Government's debt repayment obligations, avoid overdue debt, and prevent it from affecting the Government's international commitments.

On Government guarantee limits

The decision clearly states that, for the guarantee for 2 policy banks issuing bonds: The guarantee level for the Vietnam Development Bank in the 2024-2026 period is a maximum of VND 8,620 billion, the guarantee level for the Vietnam Bank for Social Policies in the 2024-2026 period is a maximum of VND 11,590 billion; equal to the obligation to repay the principal of government-guaranteed bonds due in the 2024-2026 period.

Thoroughly implement the goal of strictly controlling the issuance of Government guarantees for loans within the guarantee limit approved by competent authorities; the withdrawal level must not exceed the principal repayment obligation within the year.

Regarding borrowing and debt repayment of local governments, the Decision clearly states that local governments' deficit and debt limits must be controlled according to the provisions of the State Budget Law, the National Assembly's Resolutions on piloting a number of specific mechanisms and policies of some localities and Resolution No. 23/2021/QH15 dated July 28, 2021 of the National Assembly on the National Financial Plan and borrowing and debt repayment for the 5-year period 2021-2025.

Tight control of budget deficit

The Prime Minister assigned the Ministry of Finance to strictly control the state budget deficit, local budget deficit, local budget debt level, and the Government's debt repayment obligation ratio.

The Ministry of Finance is studying new methods of mobilizing loans, ensuring sufficient loans for development investment, meeting major projects on transport infrastructure, climate change response, zero net emissions commitment, digital transformation, and controlling public debt and national foreign debt within the ceiling limit and warning threshold for the 2021-2025 period and the following period.

In addition, the Ministry of Finance proactively manages the volume of government bond issuance according to the market's demand and absorption capacity, ensuring that the central budget's capital needs are met with interest rates appropriate to market conditions. Issue a variety of government bond maturities, ensuring the average government bond issuance maturities according to the National Assembly's targets.

The Ministry of Finance submits to the Prime Minister for approval the specific level of government-guaranteed bond issuance guarantee for the Vietnam Development Bank in 2024 based on the provisions of Decree No. 91/2018/ND-CP dated June 26, 2018 of the Government on the issuance and management of government guarantees, this decision and the project of issuing government-guaranteed bonds of the Vietnam Development Bank. Strengthen inspection and supervision of the use of loans and debt repayment.

The State Bank of Vietnam shall strictly control the implementation of the foreign debt limit for self-borrowing and self-payment by enterprises not guaranteed or secured by the Government within the approved limit; preside over the management of foreign debt of the private sector and preside over and coordinate with the Ministry of Finance to report to the Prime Minister in case of negative developments.

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