Prospects for Vietnam’s capital market in new era
People and technology are considered as two pillars for the development of Vietnam's capital market.
Haiphong Paper JSC (HAPACO) has owned an equity of over VND1 trillion (US$43 million), one hundred times larger than what it had before privatization.
Thanks to the advent of the stock market, the company and many other businesses have raised hundreds of trillion dongs from public investors, thereby being able to expand investment, shareholders, partners, and reach wider-scale market.
| An overview of the forum on March 30 in Hanoi. Photo: Khac Kien |
Before the establishment of the stock market, businesses like HAPACO only raised capital through bank loans, Nguyen Duc Hau, Deputy General Director of HAPACO, the first listed enterprise in the north of Vietnam, told Hanoitimes.
Local businesses have the aspiration to develop, create jobs for workers, and contribute to the development of the country, Hau said, adding: “We needed a developed capital market to help businesses raise capital and improve their performance,” said Hau.
Ta Thanh Binh Director of the Securities Market Development Department under the State Securities Commission, said that, over the past 20 years, Vietnam's stock market has made great progress, promoting its role as a medium-and-long-term capital mobilization channel to the economy. “However, more efforts are still needed to achieve the stock market upcoming development goals,” she said.
Dang Quyet Tien, Director of the Corporate Finance Department under the Ministry of Finance assessed that capital market development will encourage state-owned enterprises to raise capital, reduce the proportion of commercial credit loans and diversify forms of mobilization.
According to Can Van Luc, a Vietnamese independent expert, there is great opportunity for a balanced development of Vietnam's capital market. “However, the new era requires businesses to improve corporate governance, and the ability of regulators to operate the market. “People and technology are two pillars for the development of Vietnam's capital market,” he told Hanoitimes.
Regarding investment prospects in the new decade, Pham Tien Dung, Research Director of Bao Viet Securities Company predicted that the era 4.0 will change the way of interaction between banks, securities companies, investment funds with customers, and traditional business models.
“The rise of automation in the financial industry has changed the speed and form in which the stock market operates,” he added.
