Vietnam raises foreign commercial borrowing ceiling to 10 billion USD for 2026

The Vietnamese Government has raised the ceiling for medium- and long-term foreign commercial borrowing by enterprises and credit institutions to 10 billion USD in 2026.

Enterprises and credit institutions in Vietnam will have greater room to mobilise capital from international markets following the Government's decision to increase the ceiling for foreign commercial borrowing under the self-borrowing, self-repayment mechanism for 2026.

Under Decision No. 2184/QD-TTg, signed on November 11, 2026, the annual ceiling for medium- and long-term foreign commercial borrowing has been raised to 10 billion USD, up nearly 3.9 billion USD from the previously approved level.

The decision, which took effect on the date of signing, amends Clause 3, Article 1 of Decision No. 352/QD-TTg dated February 27, 2026, concerning the public debt borrowing and repayment plan for 2026.

Under the original plan, the ceiling for medium- and long-term foreign commercial borrowing by enterprises and credit institutions under the self-borrowing, self-repayment mechanism was set at approximately 6.124 billion USD annually.

The revised ceiling represents an increase of around 3.876 billion USD, equivalent to 63.3%.

The Government has also adjusted the permitted growth rate of short-term foreign debt from the previously planned 19-20% to a maximum of 27% compared with the outstanding debt balance at the end of 2025.

According to the decision, the adjustments were made following proposals submitted by the State Bank of Vietnam (SBV) and the Ministry of Finance concerning foreign commercial borrowing limits for 2026.

The revised ceiling applies to aggregate foreign borrowing under the national foreign debt management plan and does not constitute a direct credit allocation to individual enterprises or credit institutions.

Borrowers must continue to comply with prevailing regulations on borrowing conditions, loan registration, capital utilisation, reporting obligations and foreign exchange management.

The higher ceiling is expected to facilitate access to international financing as demand for capital to support investment, production expansion and financial restructuring remains substantial.

For enterprises generating stable foreign currency revenues, overseas borrowing could help diversify financing sources, extend debt maturities and provide access to potentially more favourable borrowing costs than those available through certain domestic financing channels.

However, the expansion of borrowing capacity also entails greater exposure to financial risks, particularly those associated with exchange rate movements, international interest rates and debt maturity structures.

As foreign commercial loans under the mechanism are not guaranteed by the Government, borrowers remain solely responsible for repaying principal, interest and all associated expenses.

Exchange rate fluctuations represent a major concern for enterprises borrowing in foreign currencies while earning most of their revenues in Vietnamese dong.

An appreciation of the currency in which a loan is denominated could significantly increase repayment obligations, even when the borrower's underlying business performance remains unchanged.

International interest rate volatility poses another challenge, especially for loans carrying floating interest rates.

Changes in global financial conditions and benchmark interest rates could raise borrowing costs over the loan's duration, potentially affecting corporate cash flows and financial stability.

Enterprises may also face refinancing risks if loan maturities are not aligned with the cash flow generation schedules of their investment projects.

Where repayment obligations fall due before a project generates sufficient revenue, borrowers could be required to secure replacement financing under less favourable market conditions.

Against this backdrop, the expanded borrowing ceiling is expected to provide additional financing options rather than encourage enterprises to increase debt indiscriminately.

Financial management considerations require borrowers to ensure that their repayment capacity remains consistent with their borrowing commitments.

Enterprises are therefore expected to carefully assess interest expenses, potential exchange rate fluctuations, arrangement and guarantee fees, hedging costs and foreign currency liabilities throughout the life of their loans.

Businesses without stable foreign currency revenue streams may need to consider appropriate exchange rate hedging instruments during the loan negotiation process to mitigate potential currency risks.

At the same time, debt maturity schedules should be structured to avoid excessive repayment obligations becoming due within a short period.

For credit institutions, the higher foreign borrowing ceiling could create additional opportunities to mobilise funds for business operations and strengthen financing capacity.

Nevertheless, foreign borrowing activities must remain consistent with prudential requirements, foreign currency liquidity management and asset quality standards prescribed by the SBV.

The adjustment under Decision No. 2184/QD-TTg is therefore expected to expand financing opportunities for Vietnamese enterprises and credit institutions while underscoring the importance of prudent debt management.

With the annual ceiling increasing from approximately 6.1 billion USD to 10 billion USD, borrowers will need to place greater emphasis on controlling exchange rate exposure, selecting appropriate debt maturities and ensuring the efficient utilisation of borrowed funds.

The revised framework maintains the principle that expanded access to international capital must be accompanied by corresponding repayment capacity, with financial risks and obligations remaining the responsibility of individual borrowers.

Business & Integration - Vietnamese version: Mở thêm gần 3,9 tỷ USD dư địa vay nước ngoài cho doanh nghiệp; reported by Tran Linh