Vietnam is reaping the rewards of fiscal prudence, with public debt figures falling sharply over the past five years, offering breathing room for the State budget and signalling improved financial security.
According to a newly released report from the Ministry of Finance, the country’s public debt has dropped from 55.9 percent of GDP in 2020 to just 34 percent in 2024 — well below the statutory ceiling.
The national public debt report for the 2020–24 period reveals that government debt accounted for 31.8 percent of GDP in 2024, a significant reduction from 49.9 percent in 2020.
Government-guaranteed debt declined to 2.2 percent, while local government debt held steady at approximately 0.6 percent of GDP.
The Ministry of Finance attributed this shift to tighter fiscal discipline and improved debt management by the State. Beyond the overall reduction, the report noted a clear slowing in public debt growth, laying a more stable foundation for budgetary balance.
External borrowing has also been curbed. The country’s foreign debt-to-GDP ratio dropped from 47.9 per cent in 2020 to 27.9 per cent in 2024, further reducing reliance on overseas loans and enhancing national financial security.
The pressure of debt servicing has eased as well.
The Government’s debt repayment obligations fell from 21.2 percent of State budget revenue in 2020 to 18.9 percent in 2024. This ratio is considered a key indicator of repayment pressure, and maintaining a low and downward trend is seen as vital for long-term fiscal sustainability.
However, the report also noted that the country's foreign debt repayment obligation compared to the export turnover of goods and services recorded an increasing trend from 5.7 percent in 2020 to 7.8 percent in 2024.
Although this increase has not created much pressure, it reflects the fact that Việt Nam needs to continue to promote exports and maintain a stable trade balance to ensure room for debt repayment in the long term.
