G-bonds: easy to sell, harder to disburse capital
The state treasury of Vietnam plans to issue government bonds worth 50 trillion VND (2.24 billion USD) in the third quarter of 2016.
Illustrative image (Photo: VNA)The treasury will issue three-year bonds worth 5 trillion VND, five-year bonds worth 22 trillion VND and seven-year bonds worth 10 trillion VND.
It will also issue 10-year bonds worth 2 trillion VND, 15-year bonds worth 7 trillion VND, 20-year bond worth 1 trillion VND, and the longest term of 30-year bonds worth 3 trillion VND.
According to the treasury, the capital mobilisation from G-bonds in the first half of the year was effective, selling bonds worth more than 182 trillion VND, nearly 83 percent of the initial plan for the entire year.
After the first half, the treasury decided to add bonds worth another 30 trillion VND - bringing the total for the year to 250 trillion VND.
While the G-bond mobilisation was considered successful, the process of the G-bond capital disbursement was slow and failed to support the GDP growth in the context of low economic growth in the first six months, according to the Ministry of Planning and Investment (MPI).
The MPI said all ministries, sectors and localities disbursed about 81.8 trillion VND of public investment capital in the first five months of this year, completing 32.6 percent of the disbursement plan for 2016.
The MPI said complicated procedures and slow processes in some ministries and localities caused the problem. Some with the lowest disbursement percentages included the Ministry of National Defence with 9.8 percent, Hanoi with 2.9 percent, Phu Tho Province with 2.6 percent and Tien Giang Province with 2.3 percent, besides Son La Province with 1.1 percent.
On July 7, Prime Minister Nguyen Xuan Phuc asked all relevant agencies and local authorities to fast-track the disbursement of public investment capital to accomplish socio-economic development targets by the end of 2016.-VNA
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