Vietnam PM confirms overspending, GDP growth set to hit 5.4 percent

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Prime Minister Nguyen Tan Dung told a National Assembly session opening Monday that state budget overspending this year would likely be significantly higher than desired.


Dung made the statement while delivering a report on the country's current socio-economic situation that estimated Vietnam's GDP growth at 5.4 percent this year.

Dung told lawmakers that state budget overspending in 2013 may reach 5.3 percent of GDP, while the government's goal was to keep it below 4.8 percent.

According to the report, total public spending this year will reach an estimated at VND986.3 trillion (US$46.75 billion), 0.8 percent higher than the government's budget forecast.

This is the first time the government has conceded that state budget overspending has exceeded the ceiling rate set by the National Assembly, Vietnam's legislature, earlier this year.

Early this month, the government urged the house to increase the debt ceiling from 4.8 percent of GDP this year to 5.3 percent next year, saying it needs money for public spending.


It made the proposal at a meeting organized by the assembly's Economic Committee, and lawmakers are expected to vote on it in this session.


However, no one from the government or the Ministry of Finance mentioned state budget overspending at the committee meeting.


Dung reassured the house that Vietnam's government debts, public debts and foreign debts were still at safe levels.

The prime minister also pointed to some positive developments in his speech.

He said inflation has been cut from 18.13 percent in 2011 to 6.81 percent in 2012, and is expected to hover around 7 percent this year.

He also mentioned that the country is still enjoying "reasonable" growth and people's living standards have continued to improve over the last few years.


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