With public debt accounting for 48% of the GDP, each Vietnamese citizen currently owes VND18.6 million (USD886).

The Vietnamese public debt has been estimated at USD80 billion, spread over a the total population of 90.5 million people. Vietnam’s public debt increased by 11.2% on year by the end of 2013.

Early this year, the Vietnamese government issued Resolution No.1, requesting a curbing of the state budget deficit at no more than 5.3% of the GDP and controlling loans without government guarantees.

The government has also asked the Ministry of Finance to take measures to manage public debt and use loans more efficiently in order to keep debt at manageable level, below 65% of the GDP.

With the above-mentioned figures, Vietnamese public debt is still considered manageable, but the country faces the risk of a debt increase.

At a National Assembly meeting, held in November 2013, Prime Minister Nguyen Tan Dung said with the state budget deficit would be around VND224 trillion (USD10.6 billion) in 2014 and government bonds would total VND170 trillion (USD8.1 billion), Vietnam’s public debt is expected not account for 65% of the GDP this year and repayment is a major concern.

At a seminar in late 2013, Dr. Pham The Anh warned that the biggest potential risk for the Vietnamese public debt is not the debt on paper, but bad debt from state-owned enterprises (SOEs) which may require the state budget for their repayment.

Dr. Anh cited a report submitted to the National Assembly by the government which said that the total debt of wholly state-owned enterprises was estimated at VND1,550 trillion (USD73.8 billion) in late 2012, equal to around 52.5% of the GDP.

After deducting 11.7% of the debt guaranteed by the government, 40.9% of the SOE debt was not guaranteed.

Despite not receiving government guarantees, the government still supports SOEs, in hopes of saving them from bankruptcy.

If SOE debt, which is not guaranteed, as well as the debts accrued in the construction sector are included, Vietnam’s real public debt will account for 98.2% of the national GDP, Anh said.