Gov't public debt payment suffers less impact from US dollar appreciation

Created 06 August 2022
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The Ministry of Finance (MoF) announced on Wednesday that the appreciation in the value of the greenback did not make much impact on the Government’s public debt and debt payment.

Rạch Giá Port in the southern province of Kiên Giang is under construction with investment capital from the Government. The Government's public debt is said not to be affected by the appreciation in value of the greenback this year. — VNA/VNS Photo

HÀ NỘI — The Ministry of Finance (MoF) has announced that the appreciation in the value of the greenback did not make much impact on the Government’s public debt and debt payment.

Under the exchange rate fluctuations of the three main currencies (US dollar, Japan yen and euro), the Government's outstanding debt by the end of this year is estimated to reduce by about VNĐ57 trillion (US$2.4 billion) or a decrease of 2 per cent compared to outstanding debt late last year.

Based on the selling rates of the central bank, one US dollar has strengthened by 1.1 per cent in value against one Vietnamese đồng since the beginning of this year. Thereby, the Government’s debt balance is estimated at $213 million (or VNĐ5 trillion compared to late 2021).

One euro has weakened by 9.5 per cent against one Vietnamese đồng compared to the beginning of this year. It is estimated to reduce the Government’s outstanding debt balance in 687 million euro (or VNĐ17 trillion compared to late 2021).

Meanwhile, the Japanese yen (JPY) has weakened by 13 per cent against one Vietnamese đồng compared to the beginning of this year. It is predicted that the Government’s debt balance reach about 250 million JPY (or VNĐ45 trillion compared to late 2021).

The Finance Ministry also reported that the Government's debt repayment obligation does not affected much by the appreciation in the value of the US dollar.

Currently, the Government’s domestic loans accounts for 90 per cent and foreign loans only account for about 10 per cent of the total value annually.

According to the ministry, since the begining this year, repayment of the Government’s debt reached about VNĐ192.1 trillion or 57.2 per cent of the plan.

Of the sum, domestic debt repayment accounted for VNĐ148.7 trillion and foreign debt repayment reached VNĐ43.4 trillion. Meanwhile, direct debt repayment is about VNĐ175.8 trillion (58.6 per cent of the plan) and on-lending is about VNĐ16.2 trillion (45.3 per cent of the plan). — VNS


Source: VNN

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