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Investing.com -- Vietnam’s aggressive pursuit of economic growth could lead to policy decisions that increase already high debt levels, raising risks to the country’s credit rating and domestic banks, Fitch Ratings warned.
"We believe there is a risk that the authorities could loosen monetary and credit policy significantly as they seek to achieve the government’s ambitious target," Fitch Ratings said in a statement Friday.
The rating agency noted that Vietnam’s debt level is already high, estimated at approximately 135% of gross domestic product by the end of 2024.
This figure significantly exceeds the 53% median for countries with a ’BB’ rating from Fitch.
The agency expects Vietnam’s debt ratio to increase further as the government implements measures to counter the impact of higher US tariffs.
Planned reforms, including the elimination of credit growth quotas for banks starting in 2026, may contribute to this upward trend in debt levels.
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