Minister of Finance Ho Duc Phoc (Photo: VOV)

According to assessments by international organizations, Vietnam’s public debt has become more sustainable, which is enabling expansionary fiscal policies to aid economic recovery and development, such as value-added tax (VAT) cut by 2% in 2023 and the first half of 2024. 

A report by the Ministry of Finance said that in 2021, Vietnam’s public debt stood at 43.1% of its GDP. By early 2024, it dropped to 37%, much lower than the debt ceiling rate of 60% set out by the National Assembly. Foreign debt, in particular, was only 34% of GDP.

Minister of Finance Ho Duc Phoc said, “There's ample room for more public borrowing to invest in critical infrastructure and projects that enable future development. These projects must have the highest efficiency and contribute the most to economic growth."

He continued, "We only borrow once we can pay off debt and only borrow to implement effective and efficient projects that can bring about breakthrough economic development.”