Illustration. (Photo: World Bank)The Lao lawmakers have expressed concern over rising publicdebt against a backdrop of steep depreciation of the local currency, risinginflation, and economic vulnerabilities caused by the war in Ukraine.
When it comes to the public debt, the government can assurethat management is at a high degree of safety, Bounchom told parliament lastweek.
“We will not allow our country to slide into default,”Vientiane Times quoted the minister as saying.
Public debt levels have increased considerably since 2019, rising to 88 percent of GDP in 2021, with the energy sector accounting forover 30 percent of the debt stock, according to the World Bank.
During his speech at the NA session, Finance MinisterBounchom said that the government has sufficient funds to repay debts untilAugust this year.
The government has sold bonds to help pay off domesticobligations and is negotiating with foreign creditors to extend repayment termsfor debts due beyond August.
While a budget was approved by the NA to repay domestic andforeign debts amounting to 7.15 trillion LAK (476.96 million USD) and 1.598billion USD, respectively, this year.
By May, only 1.62 trillion USD in domestic debt had beenpaid, accounting for just 24.53 percent of the target.
At the same time, only 137.9 million USD of planned foreigndebt repayments had been made, accounting for only 8.62 percent of the target.
Minister Bounchom explained these small amounts by sayingthat the majority of debts were not due until the third and fourth quarters ofthis year.
He said that the sale of government bonds had netted thegovernment over 9.57 trillion USD, or 95.78 percent of the target./.
VNA
