The Prime Minister’s Working Group, led by Minister-Chairman of the Government Office Mai Tien Dung, on December 20 held a working session with relevant ministries and agencies to clarify responsibilities for delayed payment of several foreign loans. 

At the working session. Photo: VGP

The session was convened after credit rating agency Moody’s confirmed Viet Nam's ratings at Ba3, changes outlook to negative.

Specifically, the participants, including representatives from the ministries of finance, planning and investment, transport, industry and trade and the central bank, discussed reasons leading to slow payment for foreign loans for projects: La Son-Tuy Loan Highway, National Road 20 and Hoi Xuan Hydropower Plant.

The related ministries and agencies reported on management and payment of foreign loans, explaining reasons for delayed payment of these loans, and putting forwards measures to avoid repeated delay.

Speaking at the session, Dung said that the Prime Minister is not satisfied with the delayed payment, asking the relevant agencies and individuals to hold responsible for and report the issue to the Government and the PM.

Dung said the PM had issued a number of documents figuring out ministries’ specific responsibilities for payment of foreign debts in order to avoid delay that may affect Viet Nam’s credit profile.

He conveyed the PM’s request that the relevant ministries and agencies must ensure information transparency and timely rectify shortcomings in coordination.

Earlier on December 18, Moody's Investors Service confirmed the Government of Viet Nam's Ba3 local and foreign currency issuer and senior unsecured ratings, and changed the outlook to negative, concluding the review for downgrade that was initiated on 9 October 2019.

The confirmation of the rating reflects Moody's assessment that enhanced attention by the administration on forthcoming payments of all the government's debt obligations, direct and indirect, reduces the risk of renewed payment delays.

The negative outlook reflects some ongoing risk of payment delays on some of the government's indirect debt obligations, in the absence of more tangible and significant measures to improve the coordination and transparency around debt management within the administration.

Viet Nam's long-term foreign currency bond ceiling at Ba1, its long-term FC deposit ceiling at B1 and its local currency bond and deposit ceilings at Baa3 are unchanged.