Budget Deficit in Vietnam from 2008 - 2012 - 5259 Words

TABLE OF CONTENT I. Definition and Current Situation in Vietnam 3 I.1.What is budget deficit 3 a. Definition 3 b. How to measure 3 I.2.Overview the budget deficit in Viet Nam for the latest 5 years 4 II. Factors influencing budget deficit in Vietnam 4 II.1 State Budget Revenue 4 a. High tax rate 4 b. Revenues from unsustainable non tax resources 5 II.2 State Budget Spending 6 a. High public spending continuously 6 b. Widely spread public investment 6 c. Low investment efficiency from the SOE sector 7 III. Impact of Budget Deficit to Macroeconomic Variables in Theory and Practice 8 III.1 Inflation 8 III.2 Interest rate 8 III.3 Trade balance exchange rate 9 III.4 Economic Growth 10 IV. Recommendations for†¦show more content†¦Deficits are financed by borrowings that itself increase the debt. If the ratio debt-to-GDP gets too high, investors will worry that the government will either default on this debt or will devaluate by monetising its debt and in this way engineer a high inflation rate. According to the Maastricht Treaty, the EU countries should not have a budget deficit higher than 3% of the GDP and a debt higher than 60% of the GDP. I.2.Overview the budget deficit in Viet Nam for the latest 5 years Macroeconomic Report 2012 titled â€Å"from macroeconomic instability to restructuring† released by the National Assembly’s Economic Committee announced that Vietnam’s state budget deficit and public debts have increased rapidly. The report (Figure 1 Annex) pointed out that the country has suffered constantly increasing the state budget deficit for more than a decade. Particularly, the average state budget deficit (excluding repayments for Vietnam’s original debts) in the 2003 – 2007 period was only 1.3 percent of GDP, but this figure had more than doubled to 2.7 percent of GDP in the 2008 – 2012 period. Especially in recent years, ongoing budget deficits have led to the rapid growth of public debt. Vietnam’s total public debts have increased from about 40 percent of GDP in late 2007 to 57 percent of GDP at the end of 2010 and only declined slightly in 2011. At the same time, Vietnam’s foreign debts have surgedShow MoreRelatedThe National Debt Of The United States Essay1644 Words   |  7 PagesWhen we talk about national deficit and surplus we refer to the government budget balance from year to year, not a cumulative total of all debt. I want to review the background of the US debt, how it has reached its all-time highs along with the components, our obligations, measurements, risks, and foreign holdings and also discuss if there are causes for concern. Background The â€Å"Nixon Shock† as it’s referred to, is said to have opened up the door for our large deficit. Before President Nixon removedRead MoreExport And Import Markets And Trade Balance Essay1534 Words   |  7 PagesDollar 0.000105 9481.559315 Swiss Franc 0.000075 13342.599438 Malaysian Ringgit 0.000329 3044.057124 Japanese Yen 0.008360 119.614523 10. Government Deficits and Debt Figure 15. Government budget deficit trend of Indonesia In 2015, Indonesia’s Government budget deficit was 2.53 percent of the country s Gross Domestic Product. The budget reached to an all-time high level of 3.02 % in 1995 and a record low of -2.53 in 2015. Figure 16. Debt to GDP trend of Indonesia Indonesian Government’sRead MoreVietnam : A Successful Development Process2161 Words   |  9 PagesMacroeconomic Overview of Vietnam Vietnam has gone through a successful development process, known to be one of south east Asia’s fastest growing economy and could possibly become a developed nation by 2020 (BBC News, 2014). Vietnam was once one of the poorest countries in the world in 1986 with per capita income below $100. As of present, Vietnam has transformed into a lower middle income country with per capita income of $1,960 by 2013 (The World Bank, 2014). Vietnam’s GDP per capita have beenRead MoreWas the Vietnam War Necessary?1771 Words   |  8 PagesThe Vietnam War was not necessary Donna Baker COM/172 Version 3 October 29, 2012 Donna Hooley The Vietnam War started in 1954 with the defeat of the French and ended in 1975 with the fall and withdrawal of Saigon. The United States’ (U.S.’s) involvement in the Vietnam War started in 1963 with support of weapons, military training, advisement, and supplies until 1965 when U.S. troops went into battle with the North Vietnamese (Szczepanski, n.d.). American troops did not pull out of the war untilRead MoreFiscal Deficits And Government Debts3391 Words   |  14 PagesFiscal deficits and Government Debts. The growth of government debt can have disastrous consequences for an economy in the long-run. How can one explain these occurrences and how, if at all, can they be stopped or prevented? When federal revenues and government spending are equal in a given fiscal year, then the government has a balanced budget. When the revenues are greater than spending, the result is a surplus. But if government spending is greater than tax collections, the result is a deficitRead MoreThe United States Foreign Aid to Developing Countries: A Research Report1679 Words   |  7 PagesThis aid comes in the form of money, food, humanitarian work, and military assistance. The countries who receive the foreign aid certainly need assistance, but do not always use the aid wisely. Now that our country is undergoing serious fiscal deficits, the nations costly foreign aid commitments must be reexamined. Thesis: The U.S. should stop giving foreign aid because the original purpose of foreign aid, to stop the threat of Communism, has expired. Foreign aid given for economic developmentRead MoreThe Past During The 19th Century1771 Words   |  8 Pagestime our economy was colonial. Our investments had first come from France and then Britain. Growth was established on exports of natural resources like furs, fish, lumber, wheat, and minerals, while our imports were of manufactured goods. By the 19th Century, our Canadian economy started to reconstruct from colonial to a continental one. In the 1840s, Britain withdrew from the Commercialism systems that have given priority to imports from the colonies, including Canada. In return, Canada looked toRead MoreLife Expectancy At The Philippines1795 Words   |  8 Pagesdependency ratio will hover below 10% until it starts rising to 14% around 2050. Conclusion Unlike Thailand, Indonesia and Vietnam, the Philippines have a relatively complicated benefit calculation. Replacement rates were too high for non-high earners, up to 78.1% for an average earner, therefore not achieving the pension goal of providing old-age financial security. Learning from the Philippines, we see that actuarial valuations need to be done every few years to review the sustainability of the pensionRead MoreMgm Resorts International Case Study1684 Words   |  7 Pagesvenues. After part of the recession, only the gaming was hit harder than expected, and it is recovering slower than projected. Internationally, MGM is working to offset a weak dollar with new growth ventures in China and Vietnam and has experienced higher than anticipated returns from its Macau (China) property. MGM began in the 1960’s under the leadership of Kirk Kerkorian. In 1973, Kirk opened the MGM Grand Las Vegas on The Strip with 2100 rooms. The late 80’s and early 90’s had several venturesRead MoreShould South Africa Stay with BRICS and CIVETS or Focus on Africa?2056 Words   |  8 Pagesemerging markets, and none in Africa. In me essay I’ll be discussing whether South Africa should stay with these emerging markets or rather focus on Africa. BRICS (Brazil, Russia, India, China and South Africa) and CIVETS (Columbia, Indonesia, Vietnam, Egypt, Turkey, and South Africa) are all examples of some of the emerging markets in the world. BRICS are the world’s largest emerging markets and CIVETS are the second largest emerging markets in the world. Emerging markets are also known as; emerging