Despite signs of recovery in the economy during the first half of the
year, many difficulties and challenges remain, impacting State budget
revenues and spending.

According to the Ministry of
Finance (MoF), State budget revenues during the first six months
reached over 356 trillion VND (some 16 billion USD), only 43.7 percent
of forecast. Domestic revenues achieved only 43.3 percent of estimates,
the lowest level for the past several years.

Major
contributors to the State budget such as Hanoi , Ho Chi Minh City ,
Hai Phong and Da Nang also reported domestic revenues at under 50
percent of the yearly budget collection estimates.

During the same period, state budget spending totalled 448.9 trillion
VND (21 billion USD), equivalent to 45.9 percent of estimates, up 7.5
percent over last year’s first half.

At this pace
of collection and with some upcoming tax preferential policies, the MoF
forecasts that there is a big possibility that the state budget revenue
will decrease, while new demands are arising in budget spending.

For the remaining half of the year, ministries and related agencies
are urged to boost production and business development, timely remove
difficulties for enterprises, strictly control the budget collecting and
spending, settle debts and practise thrift.

In
order to remove difficulties and foster production and business, the
ministry has, together with the State Bank of Vietnam , evaluated the
situation and drafted a proposal on measures to settle bad debts in the
credit institution system.

The ministry is also working on a decree on debt management and settlement of bad debts in State-owned enterprises (SOEs).

In addition, the ministry has submitted to the government proposals on
stepping up SOEs’ withdrawal of capital from non-core
business areas.-VNA