Vietnam’s public debt rate remains at safe level

Vietnam’s public debt rate remains at a safe level, Japanese Ambassador to Vietnam Mitsuo Sakaba said on May 31.
Vietnam’s public debt rate remains at a safe level, Japanese Ambassador to Vietnam Mitsuo Sakaba said on May 31.

Talking with the Vietnam News Agency reporter on the threshold of the upcoming mid-term consultative group (CG) meeting for Vietnam in the Mekong Delta province of Kien Giang , Ambassador Sakaba said that Vietnam ’s public debt is much lower than that of Japan which is almost 80 percent of its gross domestic product (GDP).

The safe level of public debt depends on each country’s economic development and GDP growth, said the Japanese diplomat, noting that Vietnam ’s debt will no longer be a worry if the country maintains its GDP growth of 7-8 percent.

On Vietnam ’s development plan for the next decade, Sakaba suggested the country conduct tax, monetary and financial reform to increase the Government’s revenues.

He also emphasised the necessity for renovating the management of state-owned enterprises so that these enterprises can pay more taxes and bring greater economic benefits.

Regarding the express railway construction project in Vietnam under Japan’s Shinkansen bullet train model, Sakaba said that Japanese experts has found a close link between the express railway system and economic development when conducting a survey on Vietnam’s transport system.

This railway route will help develop urban areas and increase economic benefits along the route from Hanoi to HCM City , he added.

Experts said that not many passengers will choose this express railway for travelling between Hanoi and HCM City as it will take around six hours by this express train compared with less than two hours by plane.

However, potential passengers for this route are those who travel short distances between Hanoi-Vinh, Vinh-Hue and Vinh-Da Nang, they said.

The report concluded that the railway route will be profitable in 2030 and 2035 when the central province of Thanh Hoa and the central cities of Vinh and Danang develop at a certain level with larger populations and higher living conditions.

Based on Japanese experts’ study results, Japanese Transport Minister Seiji Maehara, who visited Vietnam in early May, also said that it will be more suitable to build the express railway in short distances than the whole route, said Ambassador Sakaba.

He also confirmed that his government is willing to cooperate with Vietnam in building this railway system.

However, he said, the cooperation form depends on the feasibility study that is underway and will be completed in the next few years./.

See more