THE PRIME MINISTER | SOCIALIST REPUBLIC OF VIETNAM |
No.: 856/QD-TTg | Hanoi, June 04, 2021 |
DECISION
ON 3-YEAR PUBLIC DEBT MANAGEMENT PROGRAM IN 2021-2023 PERIOD AND PLAN FOR BORROWING AND PUBLIC DEBT REPAYMENT IN 2021
PRIME MINISTER
Pursuant to the Law on Organization of Government dated June 19, 2015;
Pursuant to the Law on Public Debt Management dated November 23, 2017;
Pursuant to the Law on State Budget dated June 25, 2015;
Pursuant to the National Assembly’s Resolution No. 128/2020/QH14 dated November 12, 2020 on state budget estimates in 2021 and Resolution No. 129/2020/QH14 dated November 13, 2020 on allocation of central government budget in 2021;
Pursuant to the Government’s Resolution No. 32/NQ-CP dated March 16, 2021 on approval for Government guarantee limit and on-lending limit of the Government in 2021;
In consideration of the request of the Minister of Finance at the Statement No. 50/TTr-QLN dated March 30, 2021 on 03-year public debt management program in the 2021-2023 period and plan for borrowing and public debt repayment in 2021, and the Official Dispatch No. 4042/BTC-QLN dated April 19, 2021 of the Ministry of Finance;
HEREBY DECIDES:
Article 1. The plan for borrowing and public debt repayment in 2021 and the 03-year public debt management program in 2021-2023 period are hereby given approval with the following primary contents:
1. Objectives:
a) Ensure the mobilization of capital for balancing state budget and meeting social and economic development demands with rational levels of costs and risks.
b) Strictly control debt safety indicators which must fall within the limit approved by competent authorities in 2021-2025 period.
c) Promote the development of domestic capital market.
2. 03-year public debt management program in 2021-2023 period:
a) Regarding borrowing and debt repayment of the Government
- Total loan of the Government in 2021-2023 period is approximately VND 1.738,4 trillion, including VND 1.604,0 trillion allocated to the central government budget and VND 134,4 trillion used for on-lending.
- Assign the Ministry of Finance to proactively decide issuance terms, combine issuance and restructuring of debt portfolios, and develop the government bond market.
- Actively allocate funding for fulfilling debt repayment obligations of the Government in order to avoid overdue debts leading to adverse impacts on the Government’s implementation of international commitments.
b) Regarding Government guarantee
- Control the limit on Government-guaranteed bonds issued by two banks for social policies which shall not exceed their annual principal amounts payable.
- Limit the issuance of government guarantee for new applications for either domestic or foreign loans; ensure that the annual guarantee limit for domestic and foreign loans must be suitable for the growth rate of outstanding debts on Government-guaranteed loans which shall not exceed the gross domestic product (GDP) growth rate in the previous year.
c) Regarding provincial government’s borrowing and debt repayment: control the limits on budget deficits and debts of provincial governments in accordance with regulations of the 2015 Law on state budget; According to this law, the provincial-government budget deficit is about 0,2% of annual GDP. Total amount of debts payable by provincial governments is approximately VND 18,4 trillion.
d) Regarding foreign commercial loans taken by enterprises and credit institutions in the form of conventional loans: strictly control the growth rate of outstanding debts of short-term loans which shall not exceed 18-20%/year; control the annual net borrowing limit for medium- and long-term loans of not exceeding USD 6.350-7.000 million; ensure that the national foreign debt indicators fall within permitted limits.
3. Borrowing and public debt repayment plan in 2021:
a) Total loan amount of the Government is VND 624.221 billion, including VND 527.357 billion of domestic loans and VND 96.864 billion of foreign loans. In which:
- Total loan amount for balancing central-government budget is VND 579.772 billion, including VND 318.870 billion used for offsetting budget deficit and VND 260.902 billion used for paying principal amounts.
- Total loan amount used for on-lending is VND 44.449 billion.
b) Total amount of debts payable by the Government is VND 394.506 billion, including VND 366.224 billion of the Government’s debts and VND 28.282 billion of debts on on-lending projects.
c) Regarding government-guaranteed loans:
- The quantities of bonds issued by two banks for social policies under the Government guarantee shall be decided on the basis of appraisal results of their applications for bond issuance provided by the Ministry of Finance in accordance with the Government’s Decree No. 91/2018/ND-CP dated June 26, 2018.
- Total funds withdrawn from government-guaranteed domestic and foreign loans of enterprises shall not exceed their annual principal amounts payable.
d) Provincial-governments' borrowing and debt repayment plan in 2021:
- The sum of funds on-lent by the Government and other borrowed funds is approximately VND 28.797 billion.
- Total amount of debts payable by provincial governments is VND 6.662 billion, including VND 3.997 billion of outstanding principal and VND 2.665 billion of outstanding interest.
dd) Regarding foreign commercial loans taken by enterprises without the Government guarantee:
Total amount of medium and long-term commercial loans of enterprises and credit institutions in the form of conventional loans shall not exceed USD 6.350 million; the outstanding debts on foreign short-term loans shall not exceed 18%-20% of those as at December 31, 2020.
4. Implementation organization
a) Ministries, ministerial agencies and provincial People's Committees shall:
- Continue strictly and consistently implementing directives, policies and solutions for state budget restructuring and public debt management as to as ensure the national safe and sustainable finance under the Poliburo’s Resolution No. 07-NQ/TW dated November 18, 2016 and the Government’s Resolution No. 51/NQ-CP dated June 19, 2017.
- With regard to foreign loans received by the Government for implementing programs/projects, assign Ministries, central and local government authorities to allocate the plan for public investments with central government budget in 2021, sorted by investment portfolio and funding allocated for each project, and send the plan for allocation of funds from foreign loans to the Ministry of Planning and Investment and the Ministry of Finance for monitoring and controlling disbursement progress specified in cost estimates.
- The Ministry of Planning and Investment shall cooperate with the Ministry of Transport in ensuring the payment of debts on schedule, especially in allocating the medium-term public investment plan in 2021-2025 period and annual cost estimates from the year 2021, and repaying debts on government-guaranteed foreign loans for projects in the form of BT contracts in full and on schedule so as to avoid any negative impacts on the sovereign credit rating of Vietnam and the Government’s prestige. Ministries should intensify their cooperation in strictly implementing the Government's commitments and avoid ineffective cooperation and failure to fulfill responsibility resulting in late repayment of debts.
- Perform state management tasks, monitor, supervise, inspect, provide reports and information on public debts, Government’s debts and debts of provincial governments as prescribed.
b) Ministry of Finance shall:
- Develop the 5-year borrowing and public debt repayment plan in 2021-2025 period and submit it to the Government for submission to the National Assembly for consideration and approval; develop the strategic scheme for public debts in 2021-2030 period, the scheme for improvement of national sovereign credit rating in 2021-2025 period with a vision by 2030, the scheme for enhancing application of information technology to public debt management, and submit them to the Prime Minister for consideration.
- Submit reports to the Prime Minister on quantities of government-guaranteed bonds issued by Vietnam Bank for Social Policies and Vietnam Development Bank in 2021 which are decided according to the Government’s Decree No. 91/2018/ND-CP dated June 26, 2018, this Decision and their schemes for bond issuance.
- Continue promoting the in-width and in-depth development of domestic capital market and government bond market towards diversification of products and investor types while giving priority to long-term investors and attracting foreign investors to make investments in domestic capital market and bond market.
- Increase capability for managing public debts in accordance with 2017 Law on public debt management and focus on innovation of organizational model, improvement of officials’ competence and development of database and statistical systems; since 2021, make statistical reports on foreign debts in both public and private sectors adopting the “residency” principle so as to meet international standards.
c) The State Bank of Vietnam shall:
- Strictly control foreign loans taken by enterprises in the form of concessional loans without the Government guarantee and ensure that they fall within the approved limits.
- Cooperate with the Ministry of Finance to consider revising the legal framework and tools for management of national foreign debts towards separating foreign debts in public sector from those in private sector so as to meet economic development demands of a middle-income country.
- Prepare and submit orientations for roadmap for revising the legal framework for managing and supervising borrowing and repaying foreign debts on foreign loans without the Government guarantee in conformity with international practices and Vietnam’s actual conditions to competent authorities for approval.
5. Funding for implementing the 03-year public debt management program in 2021-2023 period is derived from the following sources:
a) Funding derived from state budget for implementing programs and tasks, foreign sponsorship, and usable amounts of on-lending fees and guarantee fees as prescribed in 2017 Law on public debt management, Government’s Decree No. 91/2018/ND-CP, Government’s Decree No. 94/2018/ND-CP and Decision No. 05/2016/QD-TTg dated February 05, 2016 of the Prime Minister, and Decision No. 11/2021/QD-TTg dated March 17, 2021 of the Prime Minister.
b) Ministry of Finance shall take charge of and cooperate with relevant agencies in balancing and aggregating necessary expenditures in the annual state budget estimates for implementing the Program.
Article 2. This Decision comes into force from the date on which it is signed.
Article 3. Ministers, heads of ministerial agencies, heads of Governmental agencies, and Chairpersons of people’s committees of central-affiliated cities or provinces shall be responsible for implementation of this Decision./.
| PP. PRIME MINISTER |
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