Exciting developments ahead in the securities market

14:31 | 20/02/2017 Finance - Banking

(VEN) - Minister of Finance Dinh Tien Dung, addressing this year’s first trading session on the Hanoi Stock Exchange (HNX), said the ministry will continue proposing solutions to the government and the National Assembly in order to promote the development of Vietnam’s stock market in a modern, safe, and effective manner.

After 20 years of operation and development, Vietnam’s stock market has contributed to raising capital for the economy. By the end of 2016, the Vietnamese stock market provided 25 percent of the total capital for its economy, while total stock market capitalization was equal to 74 percent of GDP, an increase of 35 percent compared to 2015.

The total capital raised through the Vietnamese stock market in 2016 reached VND348 trillion, a year-on-year increase of 54 percent, including VND312 trillion from government bonds.

Some 108 state-owned enterprises that had undergone equitization and been turned into joint stock companies were put on the Unlisted Public Company Market (UPCoM) in 2016, bringing the total number of such traded enterprises to 408.

Dung said that the state is willing to promote stronger development of Vietnam’s stock market. To achieve this goal, it requires further improvements in mechanisms and policies in accordance with international practices and national conditions, and the restructuring of Vietnam’s stock market and its management agencies. In particular, the unification of the HNX and the Hochiminh Stock Exchange needs to be accelerated, to ensure a safe, efficient, sustainable and transparent market.

The introduction of the Vietnamese derivative securities market in the second quarter of 2017 is also expected to provide additional tools to prevent risks and meet investor demand for high-level financial products in Vietnam’s stock market. Moreover, the legal framework and technical conditions for the launch of Vietnam’s first corporate bond-trading platform by 2018 need to be completed, while the biddings and transactions of government bonds to raise capital for the state budget must be well organized.

The Ministry of Finance plans to propose solutions to the government and the National Assembly in order to promote the development of Vietnam’s stock market, resolve difficulties and obstacles for businesses and protect the legitimate interests of investors. At the same time it will direct the State Securities Commission and other relevant authorities to fine tune mechanisms and policies to develop Vietnam’s stock market.

At the first trading session of 2017, two major state-owned companies - Vietnam Airlines and Vietnam National Textile and

Garment Group (Vinatex) - made their debut on the UPCoM.

Lan Ngoc