The State budget in 2022 will devote resources to the prevention and control of the Covid-19 pandemic. Photo: Tra Huong

The budget deficit is equivalent to 4% of GDP

Under Resolution 34/2021/QH15 on the State budget estimate in 2022, the National Assembly approved key targets for State budget revenue and expenditure estimates. Accordingly, the total State budget revenue is expected to raise by 3.4% year-on-year to VND1,411,700 billion. Total State budget expenditure is expected to raise 4.5% year-on-year, to VND1,784,600 billion.

In 2022, the State budget deficit approved by the National Assembly is estimated at VND372,900 billion, equivalent to 4% of GDP, including a central budget deficit of VND347,900 billion, equivalent to 3.7% of GDP, and a local budget deficit of VND25,000 billion, equivalent to 0.3% of GDP. In 2022, the total loan amount of the State budget will be VND572,686 billion.

In the Budget Report for Citizens for 2022, the Ministry of Finance said that the overall goal of the State budget estimate is to mobilize, allocate and effectively use the State's funds to suppress the Covid-19 pandemic, make good use of opportunities, to promote socio-economic recovery and development, maintain macroeconomic stability, control inflation, ensure social security and further restructure the State budget. Also to manage public debt, ensure the key role of the central budget and promote the initiative of ministries, central agencies and local agencies. In 2022, the Government will also accelerate administrative reform, associated with reorganizing apparatus, streamlining payroll, reforming the public service sector, tightening discipline and reducing State budget spending.

According to the Ministry of Finance, the State budget estimate in 2022 is built based on an economic growth of 6-6.5%, an average growth rate of the consumer price index of 4%and an export growth of 5.2%, as well as as crude oil price of US$ 60/barrel.

As for spending on Covid-19 prevention and control, the National Assembly also adjusted the State budget estimate in 2021. If local budgets and other funds are used up by the Covid-19 pandemic and wage policy reform, local agencies will be allowed to use their remaining wage policy reform resources to pay for Covid-19 prevention and control in 2021 and 2022. In addition, the local agencies will be allowed to transfer VND16,000 billion of the 2021 central budget investment plan to the 2022 plan, to allocate and assign investment plans to three national target programs. Of which, the National Target Programme on socio-economic development in ethnic minority and mountainous areas is VND6,000 billion; the National Target Programme on New-Style Rural Areas is VND6,000 billion and the National Target Programme for Sustainable Poverty Reduction is VND 4,000 billion.

Total central budget expenditure is estimated at VND1,087,032 billion

As for State budget allocation in 2022, according to Resolution 40/2021/QH15, , the total central budget revenue is VNDD739,132 billion and the total local budget revenue is VND672,568 billion . In addition, the total central budget expenditure is VND1,087,032 billion.

The National Assembly asked the Government to guide ministries, central agencies, provinces and centrally-run cities to effectively allocate State budget investment capital. In which, priority will be given to paying outstanding loans for capital construction and recovering at least 50% of the remaining advance capital in the medium-term public investment plan for the 2021 – 2025 period,

They also asked the Government to allocate sufficient capital for projects that have been completed, handed over and put into use before 2022, and allocate reciprocal capital for ODA projects and foreign concessional loans and PPP projects with State budget capital, and to prepare for investment and planning tasks and transitional projects that must be completed in 2022.

The National Assembly also directs the allocation of capital to national important projects as well as connectivity projects which have inter-regional impacts, in order to promote fast and sustainable economic development