Instead of announcing the plans quarterly, as previously, the VST this year will announce the plans monthly, to help investors to be more proactive in their capital sources. Photo tinnhanhchungkhoan.vn

HÀ NỘI — The Vietnam State Treasury (VST) plans to mobilise VNĐ500 trillion (US$19.6 billion) through issuing government bonds in 2025, Director of the VST’s Treasury Management Department Lưu Hoàng said.

Hoàng said this is a huge challenge for the treasury because it has never mobilised such a large capital amount. The target is very significant, 1.25 times the planned level for 2024 and 1.7 times the amount gained in 2024.

Explaining the reasons, Hoàng said, firstly, the Government this year has set a very high growth rate of about 8 per cent, even looking to perhaps a double-digit increase. To achieve the high growth, it will have to mobilise a large amount of capital to meet the demand for public investment spending.

Secondly, he said, the principal debt repayment of the central budget this year is higher than that last year. The budget expenditure estimate approved by the National Assembly shows that Việt Nam this year has to repay more than VNĐ360 trillion of the principal debt of the central budget, against VNĐ270 trillion last year.

Finally, due to the ambitious Government growth targets, credit growth must also be higher, Hoàng said.

Hoàng said the VST will closely follow the markets, as well as the State Bank of Việt Nam’s monetary policy, in advising and reporting back to the Ministry of Finance and competent authorities on appropriate management solutions.

From the beginning of this year, the VST will announce plans to mobilise government bonds to make the information more transparent and public than in previous years. Instead of announcing the plans quarterly, as previously, the VST this year will announce the plans monthly, helping investors to be more proactive in their capital sources so that they can have appropriate investment plans and participate more actively in government bond auctions, Hoàng said.

In addition, the VST will issue government bonds immediately from the beginning of the year, similar to what happened in 2024. When the market is favourable, interest rates are reasonable and investor demand is high, the VST will take advantage of the attractive environment to attract interest.

Hoàng noted during the implementation process, the VST will closely follow the market so that the process is consistent with the market situation and the disbursement progress of public investment projects to ensure the capital is used most effectively.

In 2024, the VST raised nearly VNĐ330.38 trillion in government bonds, reaching 83 per cent of the plan. The bonds had an average issuance term of 11.12 years and an average maturity of 9.02 years, an average issuance interest rate of 2.52 per cent per year, 69 percentage points lower than that in 2023, contributing to reducing borrowing costs for the State budget.

According to last year's Government report on public borrowing, the total demand for 2025 is expected to be nearly VNĐ815.24 trillion, an increase of 20.6 per cent compared to the Government's plan in 2024.

In 2025, the Government's direct debt repayment obligation is expected to be about VNĐ468.54 trillion, nearly 40 per cent higher than the average rate over the previous four years. Of which, principal repayment is about VNĐ361.14 trillion and interest repayment is about VNĐ107.4 trillion. — VNS