The Government will keep close control on public debt and strive to bring bad debt ratio to around three percent, according to a resolution adopted following the Cabinet regular meeting in October.

Accordingly, the State Bank is required to improve businesses’ access to credit, stimulate credit growth and ensure credit quality while tightening control of the banking system and firmly restructuring weak credit organisations.

Regarding bad debt, the government said 54.3 percent of total bad debts have been resolved by October, while the bad debt ratio as reported by credit organisations is around 3.8 percent and shows sign of declining.

The Government will continue to push the settlement of bad debt in parallel with restructuring credit organisations through completing the legal framework and enhancing the capacity of the Vietnam Asset Management Company (VAMC). At the same time, efforts will be exerted to maintain macroeconomic stability, the healthy development of the stock and property markets and economic growth to facilitate the settlement of bad debt with the goal of reducing the bad debt ratio to around 3 percent by the end of 2015.

Regarding public debt, the Government noted that public debt has increased rapidly, from 51.7 percent of the GDP in 2010 to 60.3 percent at the end of this year, explaining that the borrowings are to pay for measures to stimulate economic growth and ensure social welfare in the context of diminishing budget revenues as the country’s economic growth slowed down due to impacts of the global financial crisis and economic slump.

However, the rate is still within the acceptable level in line with the National Assembly’s resolution, the Government affirmed, noting that more than 98 percent of public borrowings were spent on infrastructure, 1.5 percent were pumped into the State budget for investment spending and only 0.4 percent were used for administrative purposes in ODA projects.

The Government is resolved to keep strict control of public debt, particularly new loans, to ensure the debt ratio is within the permitted level while tightening the monitoring and inspection of the use of capital from this source.

At the same time, the Government will take urgent measures to restructure public debt in the direction of raising the ratio of long-term, low-interest borrowing.

The Government’s resolution also instructed the Government Inspectorate to coordinate with other ministries, agencies and local governments to timely deal with complaints and petitions, particularly those involving a large number of people and having been delayed for a long time.

VNA/VNN