Vietnam boosts Government bond offerings to fuel economic expansion
Rewritten Article:
Vietnam tacks on global trade tensions and economic pressure points by ramping up Government bond issuance, funneling funds into strategic investments and domestic spending to spur a targeted 8% GDP growth.
Amid looming US tariffs and a volatile market, these fiscal moves aim to bolster the nation's economy and support businesses.
The United States poses one of the biggest threats to Vietnam's economic growth, as hefty tariffs have choked export activities—a significant catalyst for the country's expansion.
The Government's swift response includes implementing fiscal measures to safeguard economic expansion despite external challenges.
Recent figures from the Hà Nội Stock Exchange indicate that Vietnam has raked in an estimated VNĐ130.8 trillion (roughly US$5 billion) in the initial four months of 2025, spurred by government bond sales. This marks a nearly 27% increase over the same period the previous year.
This surge in bond issuance forms part of a broader financial scheme targeted at mobilizing approximately VNĐ500 trillion ($19.3 billion), equating to 4% of the country's GDP.
These funds will be channeled into critical sectors such as railway infrastructure, power generation, and domestic consumption—vital areas designed to counter the contracting export demand due to uncertainties with the US.
The Ministry of Finance revealed the rise in public spending isn't solely about hitting full disbursement of investment capital allocated to various entities, but also to address the unused budget from previous years (an estimated $19 billion).
PM Phạm Minh Chính emphasized the necessity of speeding up public investment disbursement, branding it as the secret to stimulating growth.
According to economist Cấn Văn Lực, even a 1% boost in public investment could contribute 0.06 percentage points to Vietnam's GDP growth.
Although Vietnam advances with domestic investment initiatives, the nation still relies heavily on exports, particularly to the US. Temporary US tariffs on certain goods remain a significant barrier, with anxiety mounting over plans to increase the tariff to a staggering 46% in July—initiatives proposed by US President Donald Trump.
Should the higher tariff be implemented, Vietnam's economic growth may drop by up to 3 percentage points, according to BMI Research estimates. The nation is actively negotiating to delay or eliminate the tariff.
Governmend bonds.
The success of Vietnam's economic strategies hinges upon several factors—notably the outcomes of ongoing bilateral trade negotiations with the US, and the efficiency of public spending programs.
These government bond issuance initiatives mark a significant step in Vietnam's economic policy to attain the 8% GDP growth target while steering clear of global trade tensions, particularly with the US. To summarize, the bond offerings are part of a broader strategy to channel investments into vital sectors and support domestic consumption, ultimately offsetting export slowdowns and stimulating growth.
Meanwhile, Vietnam has instituted stricter corporate bond regulations to ensure financial stability and foster investor confidence, as part of a dual approach that secures external trade risks and sustained growth through infrastructure-led development.
- The Government is using bond issuance as a key strategy to funnel funds into essential sectors like railway infrastructure, power generation, and domestic consumption.
- This surge in government bond sales has generated an estimated VNĐ130.8 trillion (approximately US$5 billion), marking a significant increase from the same period the previous year.
- The Ministry of Finance has revealed that these funds will also help address the unused budget from previous years, amounting to an estimated $19 billion.
- The Prime Minister emphasized the importance of speeding up public investment disbursement, stating that it could stimulate growth.
- Economist Cân Văn Luệc suggests that even a 1% boost in public investment could contribute 0.06 percentage points to Vietnam's GDP growth.
- In addition to domestic investment initiatives, Vietnam heavily relies on exports, particularly to the US. The anxiety over potential increased tariffs from the US remains a significant barrier.
- To counter the contracting export demand due to uncertainties with the US, these funds will be used to offset the slowdowns and stimulate growth in the economy.
