Decree No. 79/2010/ND-CP on public debt management operations

DECREE

On public debt management operations

___________________

THE GOVERNMENT

Pursuant to the Law on Organization of the Government dated December 25, 2001;

Pursuant to the Law on State Budget dated December 16, 2002;

Pursuant to the Law on Public Debt Management dated June 17, 2009;

Considering the proposal of the Minister of Finance,

DECREE:

PART I

GENERAL PROVISIONS

Article 1. Scope of Regulation

This Decree stipulates on public debt management tools; management of public debt mobilization, utilization, repayment, and risk management, debt restructuring; accounting, statistics, and auditing of public debt; organization of information dissemination, reporting, and public disclosure of public debt.

Article 2. Interpretation of Terms

The terms used in this Decree shall be understood as follows:

1. Long-term public debt strategy is a document setting out objectives, directions, solutions, and policies for public debt management developed within the framework of the national financial strategy, consistent with the five-year socio-economic development plan and the ten-year socio-economic development strategy of the country.

2. Medium-term public debt management program is a document detailing the content of the long-term public debt strategy for the consecutive three-year period, consistent with the policy framework of the economy, finance, and medium-term government budget.

3. Annual detailed borrowing and repayment plan of the Government is a document prepared annually including the detailed borrowing and repayment plan of the Government.

4. Public debt database is a collection of data and reports on the implementation status, evaluation, and analysis of public debt of the country systematically stored in an organized manner, either in electronic data form or report format.

5. Public disclosure of public debt information is the wide provision to the public of information and data on public debt in accordance with the law.

6. Foreign commercial borrowing of the Government includes loans with conditions similar to financial borrowing, export credit from foreign commercial banks or through the issuance of international bonds by the Government.

7. Portfolio debt risk encompasses all risks that may occur due to market, credit, liquidity, exchange rate, interest rate fluctuations, and risks during the process of borrowing, utilizing, and repaying debt by the Government.

8. Financial income from debt restructuring, portfolio debt revaluation is determined by the difference between the debt obligations before and after the restructuring process, including principal, interest, and related costs incurred in implementing the debt restructuring. It includes both principal, interest, and related costs incurred in implementing the debt restructuring.

9. Managing Agency refers to ministries, ministerial-level agencies, provincial people's committees under the central government.

Chapter II

PUBLIC DEBT MANAGEMENT TOOLS

Article 3. Types of public debt management tools

1. The Government uniformly manages public debt comprehensively through the following tools:

a) Long-term public debt strategy;

b) Medium-term public debt management program;

c) Annual detailed borrowing and repayment plan of the Government;

d) Safety indicators and public debt monitoring.

2. Based on public debt management tools, the Ministry of Finance shall take the lead in building and submitting to the Government for submission to the National Assembly to decide on safety indicators regarding debt, set targets and directions for borrowing, utilizing funds, and managing public debt in each five-year phase; decide on the total amount, borrowing structure, and annual repayment of the Government according to Clause 2, Article 8 of the Law on Public Debt Management.

Article 4. Long-term public debt strategy

1. The long-term public debt strategy includes the following contents:

a) Evaluation of the current status of public debt and public debt management work in the previous strategy implementation phase;

b) Objectives, directions for borrowing, utilizing funds, and managing public debt;

c) Solutions and policies to ensure effective borrowing, utilization of funds, and financial security;

d) Implementation organization of the strategy.

2. Bases for developing the long-term public debt strategy:

a) Socio-economic development strategies in each period;

b) Resolutions and decisions on policies for borrowing, utilizing funds, and managing debt by the Party, National Assembly, and Government;

c) Five-year and ten-year socio-economic development plans, sectoral, field-specific, and territorial development plans;

d) Proposals for attracting and utilizing official development assistance (ODA) sources in each period;

e) Statistical systems, survey results, and relevant reference materials.

3. The Ministry of Finance shall take the lead and coordinate with the Ministry of Planning and Investment, the State Bank of Vietnam, and relevant ministries and sectors to build and submit to the Government the long-term public debt strategy within the framework of the national financial strategy and organize its implementation after approval by the Government.

Article 5. Medium-term Debt Management Program

1. The medium-term debt management program includes objectives, tasks, and solutions regarding the mobilization, utilization of borrowed capital, repayment, and mechanisms, policies, and organizational management of debt during a consecutive three-year period to implement the safety targets for debt that have been determined by the National Assembly in the objectives and directions for mobilizing, utilizing borrowed capital, and managing public debt.

2. Main bases for building the medium-term debt management program

a) Long-term public debt strategy;

b) Macroeconomic indicators, fiscal and monetary policies;

c) Current status of debt and safety targets for debt during the period.

3. The Ministry of Finance shall take the lead and coordinate with the Ministry of Planning and Investment, the State Bank of Vietnam, and relevant agencies to build the medium-term debt management program to be decided by the Prime Minister and organize its implementation after approval.

Article 6. Annual Detailed Borrowing and Repayment Plan of the Government

1. Contents of the annual detailed borrowing and repayment plan of the Government include:

a) Domestic borrowing plan: including plans to mobilize funds for the state budget and plans to mobilize funds for development investment;

b) Foreign borrowing plan: implemented through various forms of mobilization, including ODA loans, concessional loans, commercial loans, and detailed according to foreign creditors;

c) Repayment plan: detailed according to creditors, distinguishing principal repayment from interest repayment; domestic repayment and foreign repayment.

2. Bases for building the annual detailed borrowing and repayment plan of the Government:

a) Objectives and directions for mobilizing, utilizing borrowed capital, and managing government debt as decided by the National Assembly;

b) Long-term debt strategy on public debt and the medium-term debt management program;

c) Requirements and tasks for mobilizing funds to offset the state budget deficit and for development investment in the planning year;

d) Projected drawdown of funds according to loan agreements and new issuance of government bonds in the planning year;

đ) Government's obligations to repay maturing debts in the planning year (including forecasts of contingent liabilities arising from government guarantees that must be fulfilled);

e) Projected average interest rates and exchange rates in the planning year and the need to carry out restructuring operations of government debts;

3. The process of establishing and approving the borrowing plan is stipulated as follows:

a) Annually, in accordance with the time frame for preparing the state budget estimate, the supervisory agency directs subordinate project leaders to report on the implementation situation and prepare borrowing plans according to programs and projects consistent with the progress of implementation, to be submitted to the supervisory agency for consolidation;

b) The supervisory agency consolidates the plan for using borrowed capital of the Government and sends it to the Ministry of Finance and the Ministry of Planning and Investment for overall consolidation;

c) The Ministry of Finance takes the lead and coordinates with the Ministry of Planning and Investment and the State Bank of Vietnam to consolidate the annual detailed borrowing and repayment plan of the Government into the state budget estimate and report to the Government for submission to the National Assembly for approval;

d) Based on the total amount of borrowing and repayment of the Government approved by the National Assembly together with the state budget estimate, the Ministry of Finance proceeds to establish the detailed borrowing and repayment plan of the Government according to the contents stipulated in Clause 2 of this Article simultaneously with establishing the limit for commercial foreign borrowing and government guarantees for foreign borrowing to be approved by the Prime Minister;

4. The Ministry of Finance shall take the lead and coordinate with relevant ministries and sectors to organize the implementation of the annual detailed borrowing and repayment plan of the Government that has been approved.

Article 7. The system of indicators for monitoring public debt and foreign debt of the state

1. Indicators for monitoring public debt and foreign debt of the state include:

a) Public debt as a percentage of gross domestic product (GDP);

b) Foreign debt of the state as a percentage of GDP;

c) Obligations to repay foreign debt of the state as a percentage of total import and export turnover;

d) Government debt as a percentage of GDP;

đ) Government debt as a percentage of state budget revenue;

e) Government obligations as a percentage of state budget revenue;

g) Contingent liabilities as a percentage of state budget revenue;

h) Limits on commercial borrowing from abroad and government guarantees for foreign borrowing.

2. Main bases for establishing the system of indicators for monitoring public debt and foreign debt of the state:

a) The ten-year economic and social development strategy and the five-year economic and social development plan;

b) Implementation status of monitoring indicators and safety regarding debt over the previous five years;

c) Economic growth rate and internal savings ratio;

d) Balance between borrowing and repayment capacity; foreign exchange balance; demand and structure of investment capital for the whole society, ability to mobilize domestic and foreign loans for development investment; state budget balance and other macroeconomic balances of the economy;

đ) Situation and potential for export growth, international balance of payments, foreign exchange management policy and exchange rates in each period;

e) International experience and practices concerning safe thresholds for debt indicators.

3. The Ministry of Finance shall take the lead and coordinate with the Ministry of Planning and Investment and the State Bank of Vietnam to determine the calculation methods and establish the monitoring indicators for debt as stipulated in Clause 1 of this Article. The Ministry of Finance shall submit to the Government for approval the safe debt indicators as prescribed in Clause 1 of Article 7 of the Law on Public Debt Management. The Ministry of Planning and Investment shall compile these approved safe debt indicators into the five-year socio-economic development plan for submission to the Government for approval and report to the National Assembly for consideration and decision. As for the remaining monitoring debt indicators, the Ministry of Finance shall submit to the Prime Minister for decision together with the annual detailed borrowing and repayment plans of the Government.

Article 8. Organization for monitoring public debt

1. Contents of regular supervision work on public debt status:

a) Monitoring and calculating current and future debt indicators according to macroeconomic, financial, and monetary situations both domestically and internationally to identify the level of debt risk and take appropriate measures;

b) Supervising public debt indicators in relation to macroeconomic indicators to ensure safe debt thresholds;

c) Forecasting and warning about the level of risk for the portfolio of public debt and foreign debt of the state, and proposing timely solutions, reporting to the Prime Minister periodically or urgently;

d) Supervising the implementation of limits on commercial borrowing from abroad and government guarantees for foreign borrowing.

2. Contents of analysis and assessment of sustainable debt:

a) Quantitative analysis and assessment: quantitative analysis and assessment aimed at calculating the public debt indicators as prescribed in Clause 2 of Article 7 of this Decree;

b) Qualitative analysis and assessment:

- Analysis and assessment of the domestic and international environment related to the situation of public debt and foreign debt of the state;

- Qualitative analysis and assessment of policies related to determining safe debt indicators, including: budget policy, market analysis, exchange rate policy, trade policy, and national economic growth targets;

- Issues related to institutional and legal frameworks.

3. Methods for regularly supervising the status of public debt and periodic analysis and assessment of sustainable debt

a) Regular supervision of the status of public debt is carried out in conjunction with the process of raising, using, and repaying debt as a basis for evaluating and warning about the status of debt;

b) Periodic analysis and assessment of sustainable debt are conducted annually in conjunction with the medium-term debt management program to comprehensively, systematically, and objectively examine the appropriateness, cost of borrowing, effectiveness of capital use, repayment capacity, types of risks, levels of risk, impacts, and sustainability of the debt portfolio in the present and future.

4. Responsibilities of agencies in supervising the status of public debt

a) The Ministry of Finance: is the leading agency responsible for supervising the status of public debt, responsible for guiding the calculation methods of the system of debt monitoring indicators; leading the analysis and assessment of sustainable debt; managing public debt limits, limits on commercial borrowing from abroad, and government guarantees for foreign borrowing; coordinating with relevant agencies to conduct, inspect, and supervise the situation of borrowing and repaying public debt.

b) The State Bank of Vietnam: has the responsibility to cooperate with the Ministry of Finance to establish the system of debt monitoring indicators and manage limits on commercial borrowing from abroad and government guarantees for foreign borrowing; guiding subordinate units, credit organizations, and enterprises to implement reporting systems and provide information to carry out debt evaluation and supervision as prescribed in this Decree.

c) The Ministry of Planning and Investment: has the responsibility to cooperate with the Ministry of Finance to establish the system of debt monitoring indicators; leading the assessment of the current status and effectiveness of ODA borrowing as prescribed by the Government.

Chapter III

MANAGEMENT OF RAISING, USING, REPAYING DEBT AND MANAGING RISKS, RESTRUCTURING DEBT

Article 9. Management of raising funds through issuance of debt instruments and loan agreements:

1. The issuance of debt instruments and loan agreements shall be strictly managed according to the procedures stipulated in the Law on Public Debt Management and related legal documents, ensuring within the permissible debt limit and annual borrowing and repayment plan approved by the competent authority;

2. The issuance of domestic government bonds and international government bonds by the Government must comply with the provisions of the law on securities issuance and the Decree on the issuance of government bonds;

3. Foreign borrowing through loan agreements must comply with regulations on foreign borrowing and repayment, and foreign exchange management regulations. The negotiation, signing, and approval procedures for specific loan agreements shall be carried out in accordance with the provisions of Article 10 of this Decree;

4. Borrowing from legitimate financial sources shall be implemented in accordance with the provisions of the State Budget Law based on specific loan agreements or agreements, ensuring clarity and transparency regarding borrowing conditions such as the amount borrowed, term, interest rate, and repayment conditions;

Article 10. Procedures and formalities for signing and approving foreign loan agreements:

1. For framework agreements on ODA loans, specific loan agreements made in the name of the State shall be implemented in accordance with the Law on Signing, Joining and Implementing International Treaties;

2. For other specific loan agreements, the following provisions shall apply:

a) The agency entrusted by the Prime Minister to lead negotiations shall actively discuss and reach consensus with the foreign lending party on the draft loan agreement;

b) After reaching consensus with the foreign lending party, the leading negotiation agency shall compile the negotiation results to send to relevant agencies for comments, including seeking the review opinion of the Ministry of Foreign Affairs and the examination opinion of the Ministry of Justice. Agencies requested for comments shall have the responsibility to respond in writing within seven working days from the date of receipt of the request for comments;

c) Based on the opinions of relevant agencies, the leading negotiation agency shall re-discuss with the foreign lending party to finalize the draft loan agreement and submit to the Prime Minister for signing;

d) After receiving the Prime Minister's decision to allow signing, the head of the leading negotiation agency shall proceed to sign or authorize the signing of the specific loan agreement with the foreign lending party;

đ) In cases where the content of the draft specific loan agreement is similar to the model loan agreement or framework loan agreement already approved by the Prime Minister, the leading negotiation agency shall submit to the Prime Minister for a decision on signing after negotiating and reaching consensus with the foreign lending party. For contents different from the model loan agreement or framework loan agreement already approved by the Prime Minister, specific financial conditions not mentioned in the model loan agreement or framework loan agreement, the leading negotiation agency must report to the Prime Minister for approval before signing;

Article 11. Amendment and supplementation of specific foreign loan agreements:

1. For amendments and supplements to specific foreign loan agreements that increase the Government's foreign debt obligations compared to before (such as interest rates, loan terms, loan amounts, fees), the leading negotiation agency shall submit to the Prime Minister for a decision;

2. For amendments and supplements to specific foreign loan agreements not covered under Clause 1 of this Article: The Prime Minister authorizes the leading negotiation agency to negotiate and sign with the foreign lending party.

Article 12. Use of domestic government loans

1. Domestic loans shall be allocated to programs and projects for infrastructure investment, social welfare, and other programs and projects that cannot directly recover funds and are part of the state budget expenditure tasks approved annually by the National Assembly.

2. Domestic loans shall be used to restructure debts not included in the state budget balance and shall be utilized according to the annual detailed borrowing and repayment plan of the Government and debt restructuring schemes approved by the Prime Minister.

Article 13. Financial Mechanism for the Use of Foreign Government Loans

1. For ODA and preferential loans tied to programs and projects:

a) The mechanism for allocating state budget funds shall apply to programs and projects for infrastructure investment, social welfare, and other projects that cannot directly recover funds and are state budget expenditure items, including cases where local budgets borrow foreign loans from the central budget to allocate to programs and projects;

b) The mechanism for refinancing fully or partially and allocating partially from the state budget shall apply to development programs and projects capable of recovering all or part of the capital, depending on the ability to repay.

2. For commercial foreign loans of the Government:

a) The refinancing mechanism shall apply to key national development programs and projects requiring the import of equipment and technology, capable of direct repayment and able to service the loan;

b) Such loans shall be used for restructuring the Government's foreign debt according to the annual detailed borrowing and repayment plan of the Government or according to debt restructuring schemes approved by the Prime Minister.

3. Based on the results of project investment appraisals by competent authorities and the results of refinancing appraisal agencies, the Ministry of Finance, in coordination with the Ministry of Planning and Investment, shall determine the financial mechanism applicable to programs and projects to be submitted to the Prime Minister for decision.

4. For foreign loans denominated in foreign currency or goods not directly linked to programs and projects:

a) Foreign loans denominated in foreign currency:

- Budget support loans and international balance of payments support loans (within the scope of government debt) shall be balanced against the state budget according to the approved state budget estimate by the competent authority;

- The use of foreign currency borrowed from abroad shall be carried out according to specific decisions of the Prime Minister and consistent with commitments in loan agreements.

b) Foreign loans denominated in goods:

- In cases where the loan agreement specifies domestic users of goods: The Ministry of Finance shall convert the value of the loan into Vietnamese dong to balance against the state budget and implement allocation or refinancing for the domestic users of goods. The exchange rate for conversion shall be the accounting exchange rate published by the Ministry of Finance at the time of conversion;

- In cases where the loan agreement specifies domestic users of proceeds from selling goods: The Ministry of Finance shall organize the importation, auction sale, and deposit of proceeds into the state budget for use in accordance with the provisions of the loan agreement and the financial mechanism decided by the Prime Minister;

- In cases where the loan agreement does not specify users of proceeds from selling goods: The Ministry of Finance shall organize the importation, auction sale, and deposit of proceeds into the state budget for use according to the decision of the Prime Minister.

Article 14. Counterpart Capital for Programs and Projects Using Foreign Loans from the Government

1. All programs and projects using foreign loans from the Government must establish annual financial plans. The content of the financial plan includes the foreign loan plan (classified by country or funding organization) and the domestic counterpart capital plan (central government budget funds, local government budget funds, domestic credit funds, self-owned capital of the project investors, other lawful sources of capital as prescribed by law).

2. For programs and projects that apply the mechanism of full disbursement from foreign loans provided by the Government:

a) The central government budget shall be responsible for allocating counterpart capital for projects or project components under the central government's expenditure responsibilities and directly managed and implemented by central agencies as the project sponsors.

b) The local government budget shall be responsible for allocating counterpart capital for projects or project components under the local government's expenditure responsibilities and directly managed and implemented by local agencies as the project sponsors in accordance with the laws on state budget management.

c) Project sponsors and supervisory agencies must fully calculate the need for counterpart capital, establish annual financial plans, and submit them to planning and finance agencies for consolidation into the annual state budget estimate.

3. For programs and projects that apply the mechanism of refinancing (in whole or in part) of foreign loans provided by the Government: the refiner must arrange the counterpart capital themselves.

4. The Ministry of Finance shall provide detailed guidance on establishing financial plans for each type of project using Government loans (disbursement projects, refinancing projects, credit projects, hybrid projects combining disbursement and refinancing) to consolidate into the annual state budget estimate.

Article 15. Debt Repayment Reserve Fund

1. Establishing the Debt Repayment Reserve Fund to ensure the ability to fulfill debt obligations arising from foreign loans provided by the Government for refinancing or contingent liabilities of the state budget arising from Government guarantees.

2. The sources of income and expenditures of the Debt Repayment Reserve Fund shall be carried out in accordance with the provisions of Clause 2 and 3, Article 29 of the Law on State Debt Management. The Prime Minister shall specify the details of the income and expenditure of the Debt Repayment Reserve Fund.

3. The management of the fund shall be conducted in accordance with the principles:

a) Collecting all sources of income of the Fund in a timely manner;

b) Using the Fund's capital for its intended purpose in accordance with the law;

c) Safeguarding and developing temporarily idle capital of the Fund.

4. Entrusting the Ministry of Finance to manage the Debt Repayment Reserve Fund. The Ministry of Finance shall draft and submit to the Prime Minister for promulgation the Regulations on the establishment, use, and management of the Debt Repayment Reserve Fund; issue accounting regulations for the Debt Repayment Reserve Fund within its authority, and specify detailed provisions on the organization and operation of the Fund.

Article 16. Management of the Government's Debt Portfolio and Portfolio Risk

1. The Ministry of Finance shall take the lead in managing the Government's debt portfolio, organizing sustainable debt analysis, proposing, submitting to the Prime Minister for approval, and implementing projects to address portfolio risk.

2. Requirements and principles for managing the debt portfolio and portfolio risk:

a) The Government's debt portfolio must be evaluated and classified to determine the level of risk and proactively addressed to ensure debt safety and national financial security;

b) Solutions for addressing portfolio risk must be effectively and flexibly implemented based on the situation of domestic and international capital market fluctuations;

c) The handling of portfolio risk and Government debt restructuring shall not increase the current debt obligations of the Government.

3. The process for addressing portfolio risk is specified as follows:

a) Identifying risks associated with the debt portfolio;

b) Developing a project to address portfolio risk, submitting it to the Prime Minister for approval;

c) Organizing implementation, monitoring, supervision, and evaluation of results;

d) Reporting to the Prime Minister any changes related to portfolio risk in public debt management and recommending appropriate solutions.

4. Main tools for addressing portfolio risk: The Ministry of Finance may use financial instruments on the market to ensure safety and effectiveness such as interest rate swaps, currency swaps; option transactions; extending debt, deferring debt, reducing debt, writing off debt, buying and selling debt, swapping debt, and refinancing.

Article 17. Restructuring of Government Debt Portfolio

1. Based on the medium-term debt management program and the detailed annual borrowing and repayment plan of the Government approved by the Prime Minister, the Ministry of Finance shall organize the implementation of measures to restructure the Government's debt portfolio.

2. For restructuring measures for the Government's debt portfolio that have not been anticipated in the detailed annual borrowing and repayment plan, the Ministry of Finance shall take the lead in drafting and submitting to the Prime Minister for approval a restructuring project for the Government's debt portfolio, including the following main contents:

a) The Government's obligation to repay the debt before the restructuring of the debt portfolio is planned;

b) Analysis of the necessity to restructure the debt portfolio;

c) The business operations expected to be carried out to restructure the debt portfolio, the basis for selecting these operations, and the source of funds for implementation;

d) Anticipated results after implementing the operations to restructure the debt portfolio according to two basic criteria: the Government's obligation to repay the debt and the level of risk; financial income generated from the restructuring of the debt portfolio.

Chapter IV

MANAGEMENT OF BORROWING AND REPAYMENT BY LOCAL AUTHORITIES

Article 18. Establishing Borrowing Limits for Local Authorities

1. Based on the legal provisions on budget management, the People's Committee of the province shall establish the borrowing limit for the local budget and report it to the Provincial People's Council for approval and submit it to the Prime Minister for approval.

2. All borrowings and bond issuances by local authorities must be within the approved borrowing limit. In cases where the provincial People's Committee needs to exceed the limit, the provincial People's Committee shall submit a specific project to the Ministry of Finance for review and report to the Prime Minister for decision.

Article 19. Borrowing and Repayment Plan of the Provincial People's Committee

1. Based on the borrowing limit prescribed by the State Budget Law, the provincial budget's ability to balance payments to repay debts, the progress of implementation, and the capital requirements of borrowing-funded projects, the provincial People's Committee shall draft a detailed annual borrowing and repayment plan and submit it to the Provincial People's Council for approval.

2. The detailed annual borrowing plan of the provincial People's Committee shall be developed in detail according to sources of borrowing, including bond issuance, other legitimate financial sources, and borrowing from the Government's foreign loans; according to purposes of use, including borrowing for economic and social development investment under the provincial budget's expenditure responsibilities, and borrowing for investment in projects with potential for local repayment.

3. The detailed annual repayment plan of the provincial People's Committee shall be developed in detail according to the amount repaid from the provincial budget and the amount recovered from projects.

4. After being approved by the Provincial People's Council, the provincial People's Committee shall send the detailed borrowing and repayment plans to the Ministry of Finance for consolidation.

Article 20. Implementation of Borrowing and Repayment by Local Authorities

1. Regarding bond issuance:

a) The provincial People's Committee shall draft a bond issuance project, submit it to the Ministry of Finance for review, and may only issue bonds after receiving written approval from the Ministry of Finance;

b) The bond issuance project shall clearly state the volume of bonds issued, repayment period, purpose of use, anticipated interest rate, and the ability to recover investment capital;

c) The procedures for issuing bonds shall be carried out in accordance with the laws on government bond issuance, local authority bond issuance, and guaranteed bonds.

2. Regarding borrowing from the Government's foreign loans:

a) The provincial People's Committee shall proactively coordinate with relevant ministries and sectors to develop investment programs and projects using borrowed funds from the Government's foreign loans. At the same time, they shall strive to exploit the financing capabilities of foreign parties;

b) Negotiations and signing of foreign loan agreements by local authorities shall be conducted by relevant ministries and sectors in accordance with the Public Debt Management Law and related guiding documents. The provincial People's Committee shall participate in discussions with ministries and sectors during negotiations;

c) The lending of borrowed funds from the Government's foreign loans to local authorities shall be implemented in accordance with the laws on lending from the Government's foreign loans.

Article 21. Management and Supervision of Local Government Debt

1. The People's Committee of the province shall implement borrowing and repayment of local government debt within the approved borrowing limit and plan. The Ministry of Finance shall supervise the borrowing and repayment activities of local governments.

2. The allocation of funds for debt repayment shall be carried out according to the following principles:

a) If the revenue from borrowing is included in the budget balance, the provincial budget must allocate funds for timely debt repayment.

b) If the borrowing revenue is used for programs and projects, the revenue from these programs and projects shall be used for debt repayment. In cases where the revenue from programs and projects is insufficient, the provincial budget must allocate funds for debt repayment.

3. The People's Committee of the province shall direct relevant departments at the local level to strictly manage and supervise the use of capital for programs and projects. Program and project managers shall report quarterly to the People's Committee of the province on the implementation status, capital withdrawal, disbursement, payment, and debt repayment of their programs and projects.

4. The People's Committee of the province shall report on the borrowing and repayment status of local government debt in accordance with Clause 4, Point d of Article 24 of this Decree. The database of local government borrowing and repayment shall be compiled to the Ministry of Finance for comprehensive evaluation and supervision of public debt as prescribed by the Ministry of Finance.

Chapter V

ACCOUNTING AND AUDITING

Article 22. Organization of Accounting and Auditing of Public Debt

1. Government debts and local government debts shall be reflected in accounting books in accordance with the law on accounting. The Ministry of Finance shall specify the detailed procedures for accounting of government debts and local government debts.

2. The auditing of government borrowing and repayment, and local government debts shall be conducted by the State Audit Agency in accordance with the law on auditing.

3. For government guarantees, the obligations of government contingent liabilities must be recorded and monitored. The Ministry of Finance shall specify the detailed procedures for opening books to record and monitor government guarantees.

Article 23. Auditing of Programs and Projects Using Government and Local Government Borrowed Funds

1. Programs and projects using borrowed funds from the government and local governments must be audited by the State Audit Agency or independent auditors.

2. The audit shall be carried out in accordance with the provisions of the government's foreign loan agreement (if applicable), the annual audit plan of the State Audit Agency, or the audit contract signed between the program/project sponsor and an independent auditor established and operating in accordance with the law on auditing.

3. Annually, the program/project sponsor shall be responsible for signing an audit contract with an independent auditor to conduct financial statement audits and final investment settlement audits (upon completion of the program/project) in accordance with the law on auditing. In cases where the program/project is included in the mandatory audit plan of the State Audit Agency during the year, the program/project sponsor may use the results of the State Audit Agency and does not need to use independent auditors.

4. The costs of auditing programs and projects shall be included in the investment costs of the programs and projects (except in cases where the foreign lender provides non-reimbursable aid not linked to the program/project).

The program/project sponsor shall submit a copy of the annual audit report to the Ministry of Finance (if using government borrowed funds) or to the People's Committee of the province (if using local government borrowed funds) within thirty (30) working days from the date the audit report is signed or published by the State Audit Agency or the independent auditor. The annual audit report serves as a basis for evaluating the effectiveness of borrowed fund utilization.

Chapter VI

ORGANIZATION OF INFORMATION, REPORTING, AND PUBLIC DISCLOSURE ON PUBLIC DEBT

Article 24. Organization of information on public debt

1. The organization of information on public debt includes:

a) Collecting, compiling, and reporting on the situation of signing loans, withdrawing funds, and repaying foreign debts of the Government, foreign debts guaranteed by the Government, and lending and recovering lent funds of the Government;

b) Collecting, compiling, and reporting on the situation of domestic borrowing and repayment by the Government; borrowing and repayment by local authorities; borrowing and repayment by domestic borrowing entities guaranteed by the Government;

c) Sharing data and documents on public debt among relevant agencies;

d) Publishing reports on public debt.

2. Information on public debt is collected, reported, shared, and published according to the following main classification criteria:

a) By source of borrowing including: foreign borrowing; domestic borrowing;

b) By borrower including the Government; local authorities; enterprises and financial and credit organizations guaranteed by the Government;

c) By type of borrowing including: official development assistance loans (ODA loans); concessional loans; commercial loans;

d) By term of borrowing including: short-term borrowing; medium- to long-term borrowing;

đ) By interest rate type including: fixed interest rates; floating interest rates;

e) By creditor and creditor groups: formal creditors (including bilateral creditors which are governments or government representatives and multilateral creditors which are international multilateral financial organizations); private creditors (including commercial banks; bondholders; other private creditors not belonging to the government or not representing the government);

g) By debt instruments including: loan agreements; promissory notes; bonds; treasury bills and other debt instruments.

3. Principles for collecting data and preparing reports on public debt:

a) Ensuring truthfulness, objectivity, accuracy, completeness, and timeliness;

b) For information not included in the list of state secrets, organizations and individuals may provide such information to the Ministry of Finance in writing, via fax, or through electronic data transmitted over computer networks;

c) For information included in the list of state secrets, organizations must provide such information to the Ministry of Finance in accordance with the laws on protecting state secrets.

4. Responsibilities of agencies in collecting and preparing reports on public debt:

a) The Ministry of Finance is responsible for organizing the collection of data on loans and issuance of bonds both domestically and internationally by the Government, loans by enterprises and financial and credit organizations guaranteed by the Government, and loans and issuance of bonds by local authorities to prepare reports as stipulated in Clause 1, Article 44 of the Law on Public Debt Management to report to the National Assembly;

b) The Ministry of Planning and Investment is responsible for preparing reports according to its functions and tasks assigned under Article 11 of the Law on Public Debt Management and providing them to the Ministry of Finance, including: reports on the implementation of the plan for attracting investment and using ODA funds during each period, annual lists of official aid requirements, annual planning reports on attracting and listing official development assistance (ODA) funding requirements; reports on the mobilization and use of ODA funds annually as stipulated in current regulations on managing and using ODA funds; providing quarterly and annual data related to the National Accounts to the Ministry of Finance, including:

- Gross Domestic Product (GDP) at current prices and constant prices;

- Consumer Price Index (CPI);

- Value of export goods and services trade; growth rate of export goods and services trade;

c) The State Bank of Vietnam is responsible for guiding and organizing the registration, collection of data, and reporting on foreign borrowing by enterprises to prepare and provide reports to the Ministry of Finance, including: comprehensive reports on the situation of foreign borrowing and repayment and limits on foreign commercial borrowing by enterprises and financial and credit organizations; reports on the balance of payments and foreign exchange reserves serving the supervision of the country's foreign debt status;

d) Ministries and ministerial-level agencies are responsible for preparing comprehensive reports as stipulated in Clause 3, Article 13 of the Law on Public Debt Management, including: six-monthly and annual comprehensive reports on borrowing, using borrowed funds, and repayment by subordinate units; reports on the budget estimates of the Ministry annually, specifying the expected withdrawal of foreign loans, allocation of matching funds for programs and projects in accordance with the general schedule for preparing the annual state budget of the Government;

đ) Provincial People's Committees are responsible for preparing reports as stipulated in Clause 2, Article 44 of the Law on Public Debt Management, including: annual plans and six-monthly and annual reports on the implementation of local government bond issuance, borrowing from legitimate sources, and detailed annual repayment of the locality after approval by the same-level People's Council; reports on the implementation of programs and projects using borrowed funds, and projects borrowing repaid foreign government loans as stipulated in the Government's Decree on lending back foreign government loans;

e) Lending agencies are responsible for collecting information and data on lending and repaying loans to prepare and send periodic reports to relevant agencies as stipulated in the loan authorization agreements;

g) Program and project ODA sponsors are responsible for collecting and preparing reports on foreign borrowing and repayment according to current government regulations on managing and using ODA funds;

h) Enterprises and credit organizations are responsible for reporting on the situation of borrowing and repaying domestic and foreign loans guaranteed by the Government as stipulated in the Government's Decree on issuing and managing government guarantees;

5. The Minister of Finance shall specify forms of reports and guidelines for implementing this Article.

Article 25. Reporting System on Public Debt

1. For annual plan reports: Ministries, sectors, localities shall submit their reports to the Ministry of Finance no later than July 20 each year (in accordance with the regulations on the preparation of the State budget for each year).

2. For mid-year implementation reports: Ministries, ministerial-level agencies, provincial People's Committees shall submit their reports to the Ministry of Finance no later than July 31 each year. After consolidating the reports, the Ministry of Finance shall send them to relevant agencies no later than August 31 each year.

3. For annual implementation reports: Ministries, ministerial-level agencies, provincial People's Committees shall submit their reports to the Ministry of Finance no later than February 15 of the following year.

4. For reports specified in point a, Clause 4, Article 24 of this Decree, the Ministry of Finance shall be responsible for reporting to the Government to present to the National Assembly and its agencies, and simultaneously send to relevant agencies before March 31 of the following year.

Article 26. Disclosure of Information on Public Debt

1. The Minister of Finance shall disclose and provide information on the borrowing and repayment situation of the Government both domestically and internationally, guaranteed debt, foreign borrowing and repayment of the State, and local government debt in accordance with the provisions of the law through the issuance of Public Debt Reports.

2. Public Debt Reports shall be issued twice a year in Vietnamese by the Ministry of Finance and translated into English in printed form and data on the Ministry of Finance’s website. The costs for printing, issuing, and disclosing Public Debt Reports shall be allocated within the annual budget of the Ministry of Finance.

3. The Minister of Finance shall specify detailed forms to be used for the issuance of Public Debt Reports.

Chapter VII

IMPLEMENTING PROVISIONS

Article 27. Effective Date

1. This Decree takes effect from August 30, 2010.

2. Previous Government regulations, those of ministries, ministerial-level agencies, and agencies under the Government that conflict with the contents of this Decree shall cease to be effective from the date this Decree takes effect.

Article 28. Responsibility for Implementation

Ministers, heads of ministerial-level agencies, heads of agencies under the Government, Chairpersons of provincial and centrally-administered city People's Committees, related enterprises, organizations, and individuals are responsible for implementing this Decree./.