Measures for risk prevention in state treasury management activities in Vietnam from March 10, 2025

Measures for risk prevention in state treasury management activities in Vietnam

Risk prevention measures for state treasury management activities in Vietnam include:

- Regulations on the limit of using temporarily idle state treasury funds for temporary advances and loans for the central budget.

- Regulations on the total limit of using temporarily idle state treasury funds for temporary advances and loans for the provincial local budget.

- Regulations on the limit of using temporarily idle state treasury funds to repurchase Government of Vietnam bonds.

- Regulations on the limit of using temporarily idle state treasury funds for term deposits at commercial banks, ensuring no more than 50% of the temporarily idle state treasury capacity.

- Determination of the minimum state treasury reserve that the State Treasury must maintain as an account balance to ensure the safety of payment capabilities and disbursement for the state budget and transaction units.

- Monthly, the State Treasury conducts an evaluation of the state treasury forecast situation. In cases where there is a discrepancy between the forecast data and actual state treasury revenue and expenditure exceeding the threshold decided by the Ministry of Finance in the quarterly state treasury management plan, the State Treasury reports to the Ministry of Finance to adjust the use limit of temporarily idle state treasury funds as stipulated above.

Risks in state treasury management activities in Vietnam

The risks in state treasury management activities in Vietnam include:

- Payment risk: This type of risk arises when state treasury revenue does not meet the expenditure tasks of the state treasury; or due to temporarily idle state treasury uses as stipulated in Article 7 of Decree 24/2016/ND-CP have not yet reached maturity; or loans and issuance of treasury bills are insufficient to ensure the expenditure tasks of the state treasury.

- Risk in the use of state treasury funds: This type of risk arises when temporarily idle state treasury uses as stipulated in Article 7 of Decree 24/2016/ND-CP cannot be promptly and fully recovered (principal, interest) when due; or due to adverse fluctuations in interest rates on the money market or adverse fluctuations in exchange rates.

- Other types of risks: This type of risk arises due to inaccurate assessment of the temporarily idle state treasury level or temporary deficit; or due to IT system malfunctions; or due to other force majeure events.

Refer to detailed content at Decree 14/2025/ND-CP effective from March 10, 2025.

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