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National Assembly unlikely to rush decision to sell more Gov’t bonds
The sale of more Government bonds is one of 21 suggestions to limit the impact of the financial crisis. NA Deputy Chairman Nguyen Duc Kien spoke with Viet Nam Investment Review about the move.
The suggested increase in the total Government bonds cannot be decided until the National Assembly sits in May. Is that too late?
The National Assembly has allowed the Government to mobilise VND36 trillion (US$2.1 billion) from the sale of bonds, VND6 trillion ($353 million) more than planned.
Often the sale of bonds and the disbursement of the capital do not meet the yearly plan and it will be difficult for the Government to disburse the amount already approved by July.
But if the disbursement goes well in the first half of the year and the assembly agrees to increase the issue, the Government will be able to disburse the money without being late.
Do you mean that the amount already approved is sufficient?
Yes. Money from the State budget and Government bonds for the current year will continue to be allocated until June 30. I think there is enough to accelerate projects for at least six or seven months. Increasing the amount to be raised through Government bonds this year is not urgent.
Will an increase in the amount of money raised through Government bonds make it difficult to limit the budget deficit to less than 5 per cent of Gross Domestic Product?
The assembly has approved overspending of VND87.3 trillion ($5.1 billion), equal to 4.82 per cent of GDP, for 2009.
Budget accumulation has had numerous jolts in this difficult time. The issuing of more bonds will definitely increase the overspending. That’s why the Government must calculate carefully and explain precisely its plans to the National Assembly before it offers more bonds for sale. Only when the assembly gives its nod, can the Government proceed.
Should national assembly hold an extraordinary plenary session to decide the Government’s proposals to deal with the economy?
The National Assembly has never held an extraordinary plenary session to deal with such an issue. Many people say that all the deputies should become full time delegates to respond to "hot" issues.
We also want all deputies to eventually become full-time members of the legislature. But in the prevailing conditions, we have set a target of between 50 – 70 per cent. This would allow obstacles facing the Government to be timely removed.
The global insolvency crisis has adversely affected many macro economic targets. These include the rate of economic growth and import-export turnover. Should the National Assembly adjust these targets?
The crisis has impacted our economy as shown by the fall in business.
We are trying to implement our socio-economic targets at a difficult time. But as both domestic and international economists have failed to accurately forecast the future, the assembly can’t immediately change its macro economic goals.
Government agencies will have to chart the world’s economic development from now until May so that the assembly can have the data base needed to first adjust its socio-economic targets and then suggestions as to how to do it in time for its next sittings.
But we must strive for economic growth of 6.5 per cent and export revenue of 13 per cent as planned.
Viet Nam News
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