Deputy PM Vuong Dinh Hue meets the State Securities Commission leaders of the Ministry of Finance, the Ministry of Planning and Investment, the State Bank and the Office of Government in Ha Noi on April 27.— Photo tinhnhanhchungkhoan.vn

Viet Nam News -HÀ NỘI — Deputy Prime Minister Vương Đình Huệ asked all ministries to learn more about the stock market.

The deputy PM said he wanted to make the stock market an important channel for capital mobilisation so it could share the burden with the banking sector.

At a meeting with the State Securities Commission (SSC) and leaders of the Ministry of Finance, the Ministry of Planning and Investment, the State Bank and the Office of Government in Hà Nội on Wednesday, Huệ said Việt Nam needed to mobilise its financial resources, rather than rely solely on development budgets, which were decreasing.

He said all ministries should be fully aware of the potential of the stock market so they could contribute to building a complete legal system and institution for stock market development. The market could become an important channel for raising capital for development.

Huệ said the local market has witnessed significant development, contributing to increasing the liquidity and improving the transparency of the financial markets.

According to the SSC, the market index grew by 65 per cent compared with 2011. The local market is showing signs of becoming a channel for capital mobilisation, having already contributed some 23 per cent to total social investment.

The SSC said there were 686 companies listed on the stock market and 256 companies that traded on the unofficial market of UpCom, a two-fold increase compared with 2011.

Until the end of 2015, the market capitalisation of shares was almost 35 per cent of the local GDP, 1.5 times higher than in 2011 and 145 times higher than in 2005.

The Government bond market reported an average growth rate of 31 per cent, also becoming an important channel for capital mobilisation for the Government. So far, the G-bond market comprises 59 per cent of total GDP, accounting for over half of banking system loans.

Huệ asked the SSC to find solutions to attract more foreign investors to the market. He said the SSC should work with other sectors and ministries to open venture capital funds, develop the corporate bond market and run the derivatives market.

He also asked SSC to reform its administrative procedures and improve the quality of staff and facilities to create favourable conditions for businesses and investors.

Huệ said the government would continue to promote the equitisation of state enterprises in both quantity and quality to create more resources to develop the market.

In response, SSC Chairman Vũ Bằng said the commission would continue to focus on enhancing and restructuring the stock market. He said the SSC had recommended the Government remove obstacles to attract foreign capital by enabling foreign banks to open branches in Việt Nam.

The SSC also asked the Government to allow more foreign ownership in the local market, reduce administrative procedures in portfolio investment, increase publicity and encourage transparency in the flow of capital to develop the market. — VNS