The National Assembly's Committee for Finance and Budget approved the government's proposal to sell international bonds worth 3 billion USD to restructure domestic debts due during 2015 and 2016. The committee expressed the support in a report on State bond issuance and government debt restructuring, at the National Assembly's (NA's) 13th tenure opened its 10th session on October 20. It noted that any issuance must guarantee that the costs of international borrowing are no higher than those of domestic ones. Minister of Finance Dinh Tien Dung said at a meeting on October 12 that the government was seeking permission from the NA to implement the 3 billion USD issuance scheme from 2017. He specified that while funds that the government borrowed to compensate for national budget overspending remained limited, the amount of State bonds maturing during 2015 to 2016 was estimated to be significant, at roughly 363.17 trillion VND (16.14 billion USD). The committee's report said the majority of its members believe that the international bond issuances are necessary, in a context that the country's mobilisation of finances from domestic bond issuances and official development assistance is facing significant obstacles. However, some of its members said the issuances must be scrutinised before they are carried out to assure financial security, because new borrowing will not reduce the government's responsibility to pay debts. Bond terms The committee also supports the government's proposal to diversify the terms of State bonds again, a plan expected to be implemented next month. The NA resolved in November last year that the finance ministry's state treasury would only be allowed to issue bonds with terms of five years or more, as a measure to ease pressure related to public debt burdens. However, the government has proposed the re-issuance of one-year, two-year and three-year bonds, expecting that more types of bonds will accelerate a slowing State bond market. Minister Dung reported that, in the first nine months of this year, State bond issuances totaled nearly 127.50 trillion VND (5.7 billion USD), representing more than half of the 250 trillion VND (11.1 billion USD) targeted for this year. The government figured that, if the bonds are not diversified, the bond issuances may reach only some 160 trillion VND (7.1 billion USD) in 2015. "If we only keep issuing State bonds with terms of five years or longer, between now and the end of the year, we will not be able to mobilise adequate capital for spending that serves socio-economic development goals in accordance with the NA's resolutions," the committee's report said. The government suggested that the bonds with terms of five years or more should account for 60 percent to 70 percent of all bond issuances, depending on the market situation for the next five years. Overspending The committee also agreed with the government's suggestion to use about 10 trillion VND (444 million USD) from State utility enterprises, which have divested from non-core lines of business, to compenstate for national budget overspending. Earlier this month, the State Bank of Vietnam lent the ministry 30 trillion VND (1.3 billion USD) to help ease tension related to the budget issue. The finance ministry reported that the overspending had reached some 27.54 trillion VND (1.2 billion USD) in September, driving the cumulative overspending for the first nine months of this year up to 140.97 trillion VND (6.3 billion USD).-VNA