Currently,the large amount of domestic public debt plus large annual budget deficit will put more pressure on monetary policy and inflation in thecoming times. External public debt service is relatively stable over time. In the next three years, on average,Vietnam will pay about VND 32 trillion (USD 1.5 billion) in forms of interests and principal each year. The number is just above 10% of the country’s current reserves.Nevertheless, prolonged trade deficit is threatening
to deplete its reserves and weakening liquidity in the long run.