Strive for a 5-7% increase in domestic revenue in 2024

According to the State Treasury (ST), of the 164,952 billion VND mobilized, 102,375 billion VND was used to repay the due principal debt of the central budget, and the remainder (62,577 billion VND) was used to offset the deficit for development investment, essentially meeting central budget's funding needs. The average maturity of government bond issuance is 12.17 years; the average maturity of the government bond portfolio is 9.14 years; and the average issuance yield is 3.78% per year.

The ST stated that over the past few years, the balance of State budget revenue and expenditure, in general, has had a surplus, but primarily the balance of the local budget has had a significant surplus, while that of the State budget has remained in deficit.

Furthermore, the annual due principal repayment requirement is extremely high, focusing on the central budget's mission. According to the State budget estimate for 2023, the State budget's deficit demand is 430,500 billion VND, while the due principal repayment demand is 190,515 billion VND. Domestic loans through the issuance of government bonds are the primary source of compensation.

At the same time, the State Budget Law stipulates that this budget is not used to spend on the tasks of other budgets. Therefore, if a government bond is not issued, the State budget will not have the source to pay the principal debt and invest in development.

As a result, the ST issues government bonds to offset the deficit and repayment of the due principal of the State budget in compliance with the provisions of the State Budget Law and the Law on Public Debt Management. The volume of government bonds mobilized under the Ministry of Finance's tasks (within the total amount of State budget loans determined by the National Assembly and the Prime Minister).

Indeed, to link and improve the efficiency of State budget management along with fundraising, the ST annually balances the temporarily idle State budget in order to lend to the central budget when the issuance of government bonds in the market is facing difficulty, ensuring not exceed the total loan amount decided by the National Assembly and the Prime Minister; thereby, helping to reduce borrowing costs by trillions of VND per year.

However, since this is a short-term idle source (less than 12 months), it must be lent at an appropriate level so as not to affect the ST’s capacity to meet the repayment needs and avoid creating pressure for short-term repayment of the State budget, which is not in line with the policy of "Continuing to restructure public debt in the direction of extending the term, de-stress short-term repayment and reduce borrowing costs" in Resolution No. 07-NQ/TW of the Politburo and the requirement of "strictly controlling the use of State budget loans under the provisions of the State Budget Law, the Law on Public Debt Management and the legislation on State budget management " in Resolution No. 74/2022/QH15 dated November 15, 2022, of the National Assembly on promoting the implementation of policies and laws on saving and anti-waste practice.

Moreover, government bond issuance must be kept on a regular basis to maintain operations and develop the domestic fund market, maintain the fundraising channel for the State budget at all times, and create standard interest rates for other debt instruments in the market in accordance with international practices./.