Guarantee of foreign debt payment by state budget

(Baonghean) - In the first 9 months of the year, in the context of the global economy still facing many risks; domestically, the macro economy is stable, GDP growth is positive; inflation is controlled at a low level; credit growth is quite good; industrial production, especially the processing and manufacturing industry continues to grow at a high rate... However, there are still many difficulties and challenges that have had an unfavorable impact on the implementation of socio-economic development goals and the State budget in 2015. Nghe An Newspaper had an interview with Ms. Vu Thi Mai, Deputy Minister of Finance.

PV: With domestic and international conditions in the first 9 months of the year, can the Deputy Minister tell us what results the implementation of the State budget estimate has achieved?

Deputy Minister Vu Thi Mai

Deputy Minister Vu Thi Mai: As reported by the Ministry of Finance to the Government, the total state budget revenue in September is estimated at 61.3 trillion VND; the accumulated revenue for the first 9 months is 683 trillion VND, equal to 75% of the estimate, up 7% over the same period in 2014. Of which, domestic revenue is quite good, with the estimated implementation in September at 42.8 trillion VND; the accumulated revenue for the first 9 months is 504.3 trillion VND, equal to 79% of the estimate, up 17.1% over the same period in 2014; of which many revenue items have progressed quite well, some have completed the annual estimate. Although the revenue from crude oil in the first 9 months reached 51.78 trillion VND, equal to 55.7% of the estimate, down 34.8% compared to the same period in 2014, the balance revenue from import-export activities is estimated at 187.4 trillion VND, equal to 72.1% of the estimate, up 0.4% compared to the same period in 2014. After implementing the value added tax refund under the 64 trillion VND regime, the balance revenue from import-export activities is estimated at 123.4 trillion VND, equal to 70.5% of the estimate.

Regarding state budget expenditure, with total accumulated expenditure in the first 9 months reaching 823.97 trillion VND, equal to 71.8% of the estimate, up 7.8% over the same period in 2014, it can be said that the state budget expenditure situation is still stable. In particular, expenditure for development investment is prioritized, with accumulated expenditure in the first 9 months reaching 127.28 trillion VND, equal to 65.3% of the estimate, up 7.4% over the same period in 2014. Regarding the implementation of capital for construction investment, by the end of September, disbursed capital for projects is estimated at 123.5 trillion VND, equal to 64.8% of the estimate (same period in 2014 reached 63.6%). Consistent with the target from the beginning of the year, the Ministry of Finance has kept the accumulated debt payment and aid payment for the first 9 months at 114.79 trillion VND, equal to 76.5% of the estimate, up 12.5% ​​over the same period in 2014, ensuring full and timely payment of debts due as committed.

In addition, the expenditure for socio-economic development, national defense, security, and administrative management was timely met according to the assigned budget and the implementation progress of the using units. Accordingly, the accumulated expenditure for the first 9 months reached 574.89 trillion VND, equal to 75% of the budget, up 5.6% over the same period in 2014. Regarding budget balance, the state budget deficit in September was estimated at 27.54 trillion VND; the accumulated expenditure for the first 9 months was estimated at 140.97 trillion VND, approximately 62.4% of the annual budget.

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PV: Dear Deputy Minister, in the third quarter of 2015, the financial and monetary market did not develop favorably for capital mobilization for the State budget. So how is the capital mobilization situation for the State budget, and what is the next solution?

Deputy Minister Vu Thi Mai: As of September 30, 2015, the State Treasury has mobilized a total of VND2,563 billion in government bonds. Accumulated to September 30, 2015, the State Treasury mobilized VND127,473 billion (including USD1 billion in foreign currency bonds, equivalent to VND21,458 billion), reaching 51% of the 2015 plan, equal to 61% compared to the same period in 2014. The financial and monetary market encountered unfavorable developments for capital mobilization for the State budget, so the State Bank adjusted the average interbank exchange rate from 2% to 3% and widened the exchange rate fluctuation range. The developments in the foreign exchange market have strongly affected the psychology of investors in the bond market, leading to a decrease in demand for purchasing government bonds.

Therefore, one of the key tasks in the last months of the year of the Ministry of Finance is to focus on capital mobilization. Accordingly, it is necessary to synchronously and flexibly implement capital mobilization solutions, striving to mobilize to achieve the assigned plan. Review, negotiate, and accelerate the disbursement of foreign capital in cash to balance the State budget; mobilize and disburse foreign loans according to plan.

PVAccording to the Deputy Minister, what issues need to be addressed, resolved, and removed in the management of state finance and budget in the first 9 months of the year?

Deputy Minister Vu Thi Mai: Regarding the management of state budget collection, it can be said that the Ministry of Finance has closely followed the Government's direction to carry out this most important task. Right from the beginning of the year, the Ministry of Finance has focused on directing tax and customs agencies to synchronously and effectively implement newly issued tax laws, strengthen solutions to improve the quality of collection management, promote propaganda and support for taxpayers; at the same time, strengthen tax inspection and examination activities, combat smuggling and trade fraud; focus on handling tax arrears.

The results of the inspection and examination of nearly 52 thousand enterprises, an increase of 13.5% compared to the same period in 2014; the amount of tax handled increased through inspection and examination by about 8.4 thousand billion VND, paid to the State budget over 6 thousand billion VND; reduced deductions and losses by nearly 16.2 thousand billion VND; collected over 24.5 thousand billion VND of tax debt as of December 31, 2014. The Customs Department conducted 1,835 post-clearance inspections, equal to 57% of the plan; handled and collected to the State budget about 1,189 billion VND, an increase of 3 times compared to the same period in 2014.

Regarding the management of state budget expenditures, budget expenditure tasks are generally ensured according to the estimates and progress of implementation of tasks of investors and budget spending units, ensuring social security. In addition, over 77 thousand tons of national reserve rice have been issued for relief, hunger relief for people and support for students in disadvantaged areas. In the first 9 months of the year, the State Treasury system has controlled the expenditure of over 500 thousand billion VND of regular expenditures and about 165 thousand billion VND of development investment capital, thereby detecting about 22.6 thousand expenditures that have not complied with the prescribed procedures and regimes.

One of the important tasks of the Ministry of Finance is to strengthen price and market control. It can be seen that the price management of some important and essential goods continues to be persistently implemented according to market principles, with strict management by the State. In particular, regarding transportation fares, from the beginning of 2015 until now, most localities have requested transportation business units to declare prices in accordance with fluctuations in input costs; some automobile transportation business units in many provinces/cities have declared fare reductions. Regarding milk prices, by the end of September 2015, 768 milk products for children under 6 years old had announced maximum prices, registered prices, and declared prices. The price of milk for children under 6 years old has established a maximum price level, and prices are basically controlled. Retail prices of milk products for children under 6 years old have now decreased by about 0.1 - 34% compared to the time before the State applied price stabilization measures.

With these results, the Ministry of Finance believes that the focus of work is still to organize the implementation of the 2015 State budget estimate and assign the 2016 State budget estimate. The actual situation is dynamic, with many unexpected and unforeseen changes, but the important thing is that the basic scenarios that may occur are all anticipated to have appropriate, quick and synchronous countermeasures. The Ministry of Finance will continue to monitor developments and implement the State budget revenue and expenditure estimates in accordance with the goals and directions of the Government and the Prime Minister; ensure the balance of budget revenue and expenditure; synchronously deploy solutions to strive to increase budget revenue, combat fraud, tax evasion, loss and reduce outstanding debts; manage budget expenditures closely, economically and effectively, minimize additional budgetary additions; strive to collect the State budget for the whole year to reach and exceed the assigned estimate.

PV: Thank you, Deputy Minister!

Red River(Perform)