Vietnam’s budget deficit could reach VND130.6 trillion this year

March 03, 2011 | 14:30

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The Ministry of Finance estimates that this year Vietnam’s budget deficit could reach VND130.6 trillion ($6.3 billion).

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State budget revenues are expected to be around VND595 trillion ($28.7 billion), while expenditures are projected at VND725.6 trillion ($35 billion) this year.

The biggest sources of the state revenue are expected to be business and manufacturing, which will contribute VND382 trillion to government coffers. This will be followed by import and export activities with VND138.7 trillion, crude oil with VND69.3 trillion, land use with VND30 trillion.

This year, the country is also expected to receive VND5 trillion worth of aid in the form of grants from foreign countries.

Meanwhile, of the total expenditure equalling VND725 trillion, VND152 trillion will go to investment in various development projects, VND442.1 trillion will go towards regular spending and VND86 trillion for loan repayment.

In 2011, the country plans to issue VND45 trillion worth of government bonds to carry out major projects in the areas of transport, agriculture and education.

The government’s recent Resolution No. 11 means to lower credit growth to below 20 per cent, and money supply by between 15 per cent and 16 per cent this year. The government has set a goal to reduce the state deficit spending to less than 5 per cent this year. These measures are meant to curb spiraling inflation.

Last year, Vietnam’s deficit spending amounted to VND109.4 trillion ($5.28 billion), or 5.6 per cent of GDP.

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