Laws of Vietnam

THE PRIME MINISTER

DECIDES:

Article 1.- The State Bank of Vietnam shall assume the prime responsibility and coordinate with the concerned ministries and branches in exercising the rights and performing the obligations of Vietnam as a signatory to the Memorandum on the ASEAN Swap Agreement.

Article 2.- When Vietnam receives requests for loans under the ASEAN Swap Agreement, the Vietnam State Bank Governor shall be allowed to:

1. Decide on Vietnam’s total, partial or non-participation in the loan provision for each swap transaction according to the provisions of the Memorandum on the ASEAN Swap Agreement.

2. Decide on the loan amount and the type of foreign currency for each swap transaction and the extension of swap transactions when so requested.

3. Use money from the State’s foreign exchange reserve to provide loans, provided that the total loan amount does not exceed USD 60 million (the maximum level Vietnam committed to when acceding to the ASEAN Swap Agreement).

Article 3.-

1. The State Bank of Vietnam shall report to the Prime Minister and concurrently send copies of such report to the Ministry of Finance, the Ministry of Planning and Investment and the Ministry of Trade on Vietnam’s loans right after they are disbursed.

2. The State Bank of Vietnam shall have to regularly monitor the situation and detect in time problems arising in the course of implementing the ASEAN Swap Agreement, then report them to the Prime Minister for his opinions on handling direction.

Article 4.- When the repayment is due, the State Bank of Vietnam shall receive back the principals and interests of foreign-currency loans Vietnam has provided, then remit them into the State’s foreign-currency reserve; report such to the Prime Minister, and concurrently send copies of such report to the Ministry of Finance, the Ministry of Planning and Investment and the Ministry of Trade on all lending transactions of Vietnam under the ASEAN Swap Agreement.

Article 5.- When Vietnam wishes to borrow under the ASEAN Swap Agreement:

1. Borrowing principles:

The Government shall borrow foreign currencies under the ASEAN Swap Agreement to supplement the State’s foreign-exchange reserve, with a view to materializing the national monetary policy.

a/ Vietnam shall borrow under the ASEAN Swap Agreement only when its international payment balance suffers a severe deficit or its economy falls into the state of international payment insolvency, or in other emergency cases.

b/ Vietnam shall borrow only when it can envisage its repayment capability.

2. Borrowing purposes and repayment sources:

The State Bank of Vietnam shall be responsible for repaying loan principals and interests with the State’s foreign exchange reserve, and balancing corresponding VND sources from money issued under annual plans or plans for issuance of supplementary supply money, when such plans are approved.

3. The State Bank of Vietnam shall assume the prime responsibility for and coordinate with the Ministry of Planning and Investment, the Ministry of Finance and the Ministry of Trade in proposing to the Prime Minister for approval Vietnam’s borrowing scheme under the ASEAN Swap Agreement. Vietnam’s borrowing scheme shall include total borrowing amount, borrowing term, plan for use of borrowed capital and plan for repayment of debt.

4. Basing itself on the borrowing plan already approved by the Prime Minister, the State Bank of Vietnam shall carry out the procedures for receiving loans, effecting the opening of VND account for each lending country and crediting the VND amounts on books for such accounts corresponding to foreign-currency amounts Vietnam is lent. Upon the receipt of loans, the State Bank of Vietnam shall make credit entries to the State’s foreign-currency reserve, report such to the Prime Minister, and concurrently send copies of such report to the Ministry of Finance, the Ministry of Planning and Investment and the Ministry of Trade, and then use the loans according to the approved plan.

5. After completing all borrowing and repaying transactions of Vietnam under the ASEAN Swap Agreement, the State Bank of Vietnam shall report such to the Prime Minister, and concurrently send copies of such report to the Ministry of Finance, the Ministry of Planning and Investment and the Ministry of Trade.

Article 6.- The State Bank of Vietnam shall be responsible for organizing the cost accounting of Vietnam’s operations and transactions related to the ASEAN Swap Agreement according to the current law provisions.

The collected foreign-currency interests when Vietnam is the lender and the payable interests when Vietnam is the borrower as well as arising costs shall be accounted into banking operation incomes and expenses of the State Bank of Vietnam.

Article 7.- When its turn comes or when it is requested, the State Bank of Vietnam shall act as an agent bank according to the provisions of the Memorandum on the ASEAN Swap Agreement.

Article 8.- The State Bank of Vietnam shall formulate its internal administration mechanism for a quick and safe performance of professional operations defined in the Memorandum on the ASEAN Swap Agreement.

Article 9.- All information and data or documents related to the Memorandum on the ASEAN Swap Agreement; borrowing and lending transactions of Vietnam under the ASEAN Swap Agreement shall be kept under the secret regime.

Article 10.- This Decision takes effect as from the date of its signing.

Article 11.- The State Bank of Vietnam shall assume the prime responsibility and coordinate with the concerned agencies in implementing this Decision.

Prime Minister
PHAN VAN KHAI