Additional ODA required, modest capital disbursed hinh anh 1Illustrative image (Source: VNA)

Hanoi (VNA) - Although budget collection goes higher than estimate, the disbursement of investment capital remains slow, the Minister of Finance pointed out, adding the disbursement of Government bond capital reached only 35.5 percent.

Total state budget collection as of December 28 reached roughly 1.397 quadrillion VND (about 60.2 billion USD), accounting for 105.9 percent of estimates. Nevertheless, the disbursement of investment capital remains slow, even the disbursement of Government bond capital reached only 35.5 percent.

Overspending below 3.6 percent of GDP

The figure was released by Minister of Finance Dinh Tien Dung at a teleconference between the government and localities on December 28.

The Government official said state budget collection reached 103.4 percent and locality budget collection reached 109.3 percent of estimates.

The Minister said the Government since the beginning of the year has instructed tax and customs agencies to work efficiently and support enterprises, ensuring proper and adequate budget collection.

In the light of the direction, state budget collection is estimated to hit 80,000 billion VND, six percent higher than estimate and makes up 25 percent of the GDP, said the Minister.

In terms of investment expenditure, despite under Government’s close instruction, the disbursement of investment capital remained slow.

As of December 31, the disbursement of state budget capital reached only about 66.6 percent, of which Government bond capital reached some 35.5 percent.

Many ministries, sectors and localities have requested additional mid-term ODA capital, but the disbursement for 2018 hit only 40 percent. That is the point, according to the Government official.

For state budget over-expenditure, thanks to more collection and less spending, the ratio stands below 3.6 percent (reported earlier to the National Assembly 3.67 percent), Minister Dung said.

Budget collection reaches three percent higher than estimate

According to the commander of the finance sector, public debt in 2018 is estimated to hit 61 percent of GDP (reported earlier to the National Assembly 61.4 percent). Minister Dung said debt structure has been improved. Average tenor of government bonds in 2018 is 12.6 year and its average interests standing at 4.67 percent (it was 5.98 percent in 2017).

In addition, the amount of investments from social insurance funds, investment funds and insurers in government bonds increased by nearly 50 percent in 2018, Dung said. He added Vietnam has been reducing its reliance on foreign loans thanks to the development of domestic capital market.

Regarding the restructuring of State-owned enterprises (SOEs), Dung said the State collected 21.6 trillion VND (929 million USD) from initial public offerings of 21 businesses and divested 18.3 trillion VND (787 million USD). 

However, the work remains slow. As planned, at least 85 SOEs must have their equitisations completed in 2018. However, only 15 firms had been equitised as of December 20.

In addition, 667 equitized State-owned enterprises have yet to list their shares on the stock exchanges. This has caused negative impacts on the renovation of SOEs, which focus on increasing their openness, transparency, management efficacy.

Budget collection in 2019 is expected to reach three percent high than estimate, standing at over 23.5 percent of GDP, said Dung.

With regard to budget expenditure, the Minister also stressed practicing thrift and preventing wastefulness, as well as increasing investment and development spending to 27-27.5 percent, bringing budget over-spending down to below 3.6 percent of GDP, and remaining public debt at 61 percent of GDP./.

Addressing the meeting, Prime Minister Phuc stressed the government’s effective measures: “Implementing the resolutions of Party and National Assembly, the government has taken aggressive measures to undertake this year’s tasks. The government and the Prime Minister are determined to build an incorruptible and enabling administrative system to serve the people and businesses.

Mr. Phuc said this year many socio-economic indexes were high with business development and improvements in law making, boosting the people’s trust in the Party and State./.

VNA