Decree No. 164/1999/ND-CP On the Management of Vietnam's Balance of Payments

DECREE

On the management of Vietnam's balance of payments

____________________

THE GOVERNMENT

Pursuant to the Government Organization Law dated September 30, 1992;

Pursuant to the Law on the State Bank of Vietnam No. 01/1997/QH10 dated December 12, 1997;

At the proposal of the Governor of the State Bank of Vietnam.

DECREE:

PART I

GENERAL PROVISIONS

Article 1. Scope of application

This Decree stipulates the establishment, monitoring, and analysis of Vietnam's balance of payments.

Vietnam's balance of payments (hereinafter referred to as the balance of payments) is a systematic consolidated table of all indicators of economic transactions between Residents and Non-residents during a specific period.

Article 2. Establishment, monitoring, and analysis of the balance of payments

1. The State Bank of Vietnam (hereinafter referred to as the State Bank) is the agency responsible for leading the establishment, monitoring, and analysis of the balance of payments.

2. The Ministry of Planning and Investment, the Ministry of Finance, the Ministry of Trade, the General Statistics Office, and the General Department of Customs shall cooperate with the State Bank in establishing, monitoring, and analyzing the balance of payments.

Article 3. Definitions

In this Decree, the following terms are understood as follows:

1. "Economic transaction" refers to transactions involving goods, services, labor income, investment income, unilateral transfers, capital transfers, capital inflows into Vietnam, capital outflows from Vietnam in the field of direct investment, investment in securities, foreign borrowing and repayment, foreign lending and recovery of debt, other forms of investment, and other transactions as prescribed by Vietnamese law that increase or decrease assets or liabilities between Residents and Non-residents.

2. "Resident" means organizations or individuals including:

a) State-owned enterprises, private enterprises, companies, cooperatives, and other economic organizations of various economic sectors in Vietnam established and operating in Vietnam (hereinafter referred to as Vietnamese economic organizations);

b) Foreign-invested enterprises and foreign parties participating in joint business contracts operating under the Law on Foreign Investment in Vietnam; overseas branches of foreign companies, foreign contractors, joint venture contractors with foreign parties, and other economic organizations with foreign capital operating in Vietnam not under the Law on Foreign Investment in Vietnam;

c) Vietnamese credit institutions, joint venture credit institutions, non-bank credit institutions with 100% foreign capital, and foreign bank branches operating in Vietnam (hereinafter referred to as credit institutions in Vietnam);

d) State agencies, armed forces units, political organizations, political-social organizations, social organizations, social-professional organizations, social funds, charitable funds of Vietnam operating in Vietnam;

đ) Diplomatic, consular, armed forces, and political, political-social, social, social-professional organizations, social funds, charitable funds of Vietnam operating abroad; Vietnamese citizens working in these organizations and accompanying individuals;

e) Representative offices of Vietnamese economic organizations, representative offices of foreign-invested enterprises in Vietnam, and representative offices of credit institutions in Vietnam operating abroad;

g) Vietnamese citizens residing in Vietnam; Vietnamese citizens residing abroad for less than 12 months;

h) Foreign nationals residing in Vietnam for 12 months or more;

i) Vietnamese citizens traveling, studying, receiving medical treatment, and visiting abroad (regardless of duration);

3. "Non-resident" means organizations or individuals including:

a) Foreign economic organizations established and operating abroad;

b) Vietnamese economic organizations, foreign-invested enterprises in Vietnam operating abroad;

c) Vietnamese credit institutions, foreign credit institutions in Vietnam established and operating abroad;

d) State agencies, armed forces units, political organizations, political-social organizations, social organizations, social-professional organizations, social funds, charitable funds of foreign countries operating abroad;

đ) Diplomatic, consular, international organization, intergovernmental organization, non-governmental organization, armed forces, and political, political-social, social, social-professional organizations of foreign countries operating in Vietnam; foreign nationals working in these organizations and accompanying individuals;

e) Representative offices of foreign economic organizations; representative offices of foreign credit institutions operating in Vietnam;

g) Foreign nationals residing abroad; foreign nationals residing in Vietnam for less than 12 months;

h) Vietnamese citizens residing abroad for 12 months or more;

i) Foreign nationals traveling, studying, receiving medical treatment, and visiting Vietnam (regardless of duration);

In cases where it cannot be determined whether an organization or individual is a Resident or Non-resident, the Governor of the State Bank shall decide.

4. "Service receipts and payments" refer to amounts received and paid from service activities related to transportation, tourism, postal services, telecommunications, insurance, aviation, banking, information, construction, and other service activities between Residents and Non-residents.

5. "Labor income" refers to wages, bonuses, and other monetary and in-kind income paid by Non-residents to Residents and vice versa.

6. "Investment income" refers to profits from direct investment, interest from investment in securities, and interest due on loans and debts between Residents and Non-residents and vice versa.

7. "Unilateral transfers" refer to non-repayable grants, gifts, and other monetary and in-kind transfers for consumption purposes made by Non-residents to Residents and vice versa.

8. "Unilateral capital transfers" refer to non-repayable grants for investment purposes, debt cancellations between Residents and Non-residents; monetary and in-kind assets of Residents emigrating to another country and of Non-residents immigrating to Vietnam.

9. "Net foreign currency assets" refers to the difference between foreign currency assets and foreign currency liabilities reflected in the consolidated monetary balance sheet of the State Bank and credit institutions.

10. "Change in net foreign assets" refers to the increase or decrease in net foreign assets from the beginning to the end of the reporting period.

11. "Errors and omissions" reflect the discrepancy due to statistical errors in all items of the balance of payments.

Chapter IV

BALANCE OF PAYMENTS RECORDING

Article 4. The balance of payments includes the projected balance of payments and the actual balance of payments.

1. The projected balance of payments is established based on forecasted economic and financial indicators for the upcoming period.

2. The actual balance of payments is established based on actual economic and financial data generated during the reporting period.

Article 5. Principles for establishing the balance of payments

1. The balance of payments reflects all indicators of economic transactions between Residents and Non-residents.

2. The balance of payments is established using the appropriate currency unit selected by the Governor of the State Bank.

3. Data on economic transactions are recorded at the time of transfer of ownership.

4. The value of economic transactions is calculated based on market prices and converted into the appropriate currency unit according to the exchange rate specified by the State Bank.

Article 6. Structure and main contents of the balance of payments

1. The current account aggregates all indicators of economic transactions between Residents and Non-residents concerning goods, services, labor income, direct investment income, income from securities investment, interest on foreign loans and deposits, unilateral transfers, and other transactions as prescribed by law.

2. The capital and financial account aggregates all indicators of economic transactions between Residents and Non-residents concerning the inflow and outflow of capital from abroad into Vietnam and vice versa in the areas of direct investment, securities investment, foreign borrowing and repayment, foreign lending and recovery of debt, unilateral transfers, other forms of investment, and other transactions as prescribed by Vietnamese law that increase or decrease assets or liabilities.

3. The overall balance is the aggregate of the current account and the capital and financial account.

4. The reserve account is aggregated based on changes in net foreign assets, overdue debt changes, and other sources of financing.

Detailed contents of the balance of payments are stipulated in Appendix 1 issued together with this Decree.

Article 7. Responsibilities of Ministries and sectors in establishing the balance of payments

1. The Ministry of Planning and Investment, the Ministry of Finance, the Ministry of Trade, the General Statistics Office, the General Department of Customs, and other related Ministries and sectors have the responsibility to provide information and data forecasts and actual data on economic transactions between Residents and Non-residents and other relevant data as detailed in Appendix 2 issued together with this Decree to the State Bank.

2. The State Bank has the responsibility to take the lead:

a) To determine in detail the content and scope of collecting information and data on the balance of payments within the responsibilities of Ministries and sectors, credit institutions, and other economic organizations;

b) To coordinate with the Ministry of Planning and Investment, the Ministry of Finance, the Ministry of Trade, the General Statistics Office, and the General Department of Customs to establish the projected balance of payments and the actual balance of payments of Vietnam for each period.

3. The State Bank coordinates with the General Statistics Office and related Ministries and sectors to conduct periodic and non-periodic sample surveys to collect necessary information and data for establishing the balance of payments.

Article 8. Reporting deadlines and information on data

1. Deadline for providing information on data to the State Bank:

a) Relevant Ministries and sectors as prescribed in Clause 1 of Article 7 of this Decree shall provide quarterly forecast data no later than the 15th day of the last month of the quarter before (according to Appendix 2); annual forecast data no later than September 10 of the previous year;

b) Relevant Ministries and sectors as prescribed in Clause 1 of Article 7 of this Decree shall provide actual quarterly data no later than the 20th day of the first month of the following quarter (according to Appendix 2) and actual annual data no later than January 31 of the following year;

c) Credit institutions and other economic organizations shall provide monthly data no later than the 20th day of the following month; quarterly and annual data as prescribed in Point b of Clause 1 of this Article.

2. Deadline for the State Bank to report to the Prime Minister the balance of payments:

a) Report on the projected balance of payments quarterly no later than the 25th day of the last month of the quarter before and the projected balance of payments annually no later than September 25 of the previous year;

b) Report on the implementation of the actual balance of payments quarterly no later than the last working day of the first month of the following quarter; the actual balance of payments annually no later than February 10 of the following year.

Chapter III

MONITORING AND ANALYSIS OF THE BALANCE OF PAYMENTS

Article 9. The State Bank has the responsibility

1. To take the lead with the Ministry of Planning and Investment, the Ministry of Trade, the Ministry of Finance, the General Statistics Office, and the General Department of Customs to monitor and analyze the actual balance of payments and the projected balance of payments, examine the causes of surpluses or deficits in the balance of payments, and propose measures to improve the balance of payments to be submitted to the Government.

2. To proactively manage monetary policy, credit activities, foreign exchange management, and propose measures to manage foreign borrowing and repayment by the business sector to improve the balance of payments;

3. To provide the actual balance of payments table and the projected balance of payments table to relevant Ministries and sectors;

4. To submit to the Prime Minister the projected balance of payments and the actual balance of payments accompanied by an analysis report on the balance of payments.

Article 10. The Ministry of Planning and Investment has the responsibility to monitor and analyze the impact of the balance of payments on macroeconomic indicators, propose policies and solutions for economic management to be submitted to the Government.

Article 11. The Ministry of Trade has the responsibility to monitor and analyze the impact of imports and exports on the balance of payments to propose trade policies and measures to ensure balance in the trade account.

Article 12. The Ministry of Finance is responsible for proposing measures and budgetary fiscal policies related to foreign borrowing and debt repayment through the management of fiscal policy to ensure balance in capital and financial accounts.

Chapter IV

IMPLEMENTING PROVISIONS

Article 13. This Decree shall take effect fifteen days from the date of signature.

Article 14. Any violation of the content, reporting system, and deadlines stipulated in this Decree shall be subject to administrative penalties as prescribed by law.

Article 15. The Governor of the State Bank is responsible for guiding and supervising the implementation of this Decree.

Ministers, Heads of ministerial-level agencies, Heads of government agencies, and Chairpersons of provincial People's Committees directly under the central government are responsible for implementing this Decree.