HÀ NỘI — Việt Nam’s stock market had become a launch pad for the business community, supporting the equitisation of State-owned enterprises and helping create a more balanced and efficient structure in Việt Nam’s financial market, said Prime Minister Nguyễn Xuân Phúc.

PM Phúc made the statement at a gong ceremony held at the Hà Nội Stock Exchange on Tuesday to open the first trading session after the Lunar New Year.

At the ceremony, Phúc expressed his delight at the vigorous expansion of the stock market over the past 20 years, noting that market capitalisation had increased by almost 17-fold in 12 years to the equivalent of 72 per cent of gross domestic product (GDP) last year, compared to only 22.7 per cent in 2006.

The capital private businesses mobilised through issuing corporate bonds and stocks soared by 70 per cent in 2017 and 30 per cent in 2018 to VNĐ68 trillion (US$2.9 billion), turning Việt Nam into one of the Southeast Asia’s biggest markets.

Via the stock market, the Government had mobilised capital with 20-30-year terms, helping it gear up long-term capital for public investment and public debt restructuring, the PM said.

Pointing out the stock market’s shortcomings and complicated international situations, PM Phúc said the Government would press on with improving the investment and business climate, stabilising the macro-economy and reforming the growth model.

It would also continue to consider the private sector an important driving force for economic development.

He underlined the importance of the sustainable development of the stock market and promoting its role in creating medium- and long-term capital for the economy, enhancing growth quality and boosting economic transparency.

In his speech, the PM asked the Ministry of Finance and relevant agencies to improve the legal framework for securities-related activities, take measures to upgrade Việt Nam’s stock market from a frontier to an emerging market status in the rankings of ratings agencies, and apply the achievements of the Fourth Industrial Revolution in the stock market.

He also said inspections, monitoring and settlement of violations must be stepped up to boost discipline in the market and consolidate public and investor trust.

At the ceremony, chairman of the HNX Nguyễn Thanh Long said Việt Nam’s stock market in 2018 had maintained healthy growth and was an attractive channel for investment flows inside and outside.

The stock market value reached VNĐ3.96 quadrillion in 2018, up 12.7 per cent year-on-year. The figure was equal to 72 per cent of the nation’s total GDP, Long said.

The value of foreign investors’ portfolios was estimated at $33 billion last year, indicating that the securities market was an attractive channel for foreign investments.

Long said the stock market played an important role in promoting the equitisation process of State-owned firms and corporate governance, and enhancing the openness, competitiveness, transparency and operational efficiency of businesses.

For his part, Minister of Finance Đinh Tiến Dũng said the financial sector would strive to develop a sustainable Vietnamese stock market according to international standards.

HOSE contribution

Also on Tuesday morning, HCM City chairman Nguyễn Thành Phong attended a gong ceremony at the Hồ Chí Minh Stock Exchange (HOSE).

Phong hailed the HOSE for contributing to the steady development of the country’s stock market, the city’s financial market and the equitisation of State-owned enterprises in the city.

By the end of last year the bourse had 375 listed companies with a combined charter capital of VNĐ780 trillion.

Its market capitalisation was already over 70 per cent of the city’s gross regional domestic product (GRDP), a target set only for 2020, and daily average trading was VNĐ5.6 trillion, or 85 per cent of the country’s total, he said.

“These clearly demonstrate the significance of the securities market to the country.”

“The establishment of the Vietnam Stock Exchange based on a parent-subsidiary model by rearranging the Hồ Chí Minh and Hà Nội stock exchanges along with speeding up the equitisation of State-owned enterprises would be the focal point of the city’s as well as the country’s stock market.”

Phong expected HOSE, as a pioneer of the Vietnamese securities market, to continue to perform its role well, contributing more to the development of the country’s socio-economic development.

The city would continue to back the exchange and speed up the equitisation of State-owned enterprises to create investment opportunities for investors and enable businesses to mobilise capital, he said. — VNS