4 key tasks to soon upgrade Vietnam's stock market

At the regular Government press conference on the afternoon of February 1, the press asked representatives of the Ministry of Finance about the prospect of upgrading the Vietnamese stock market.

Deputy Minister of Finance Nguyen Duc Chi said that the upgrading has been clearly set out by the Government in the Stock Market Development Strategy to 2030. The Ministry of Finance also identified this as the overarching goal during this period.

According to Mr. Chi, in order to achieve the goal of upgrading the stock market as early as 2025, in 2024, the Ministry of Finance and related ministries must actively carry out preparatory work, including 4 key tasks.

One is handling the margin requirement. This is one of the barriers, according to the assessment of market rating organizations. Mr. Chi said that the Ministry of Finance has coordinated with international rating organizations as well as market members to review and evaluate this issue and will submit to competent authorities a good and feasible solution to handle it.

Second is the issue of transparency and clarity regarding the ownership ratio of foreign investors in enterprises listed on the stock market. The Ministry of Finance has coordinated with the Ministry of Planning and Investment to publish information in the clearest and most transparent manner in both Vietnamese and English.

"We will also require listed businesses to update and publish information clearly and in real time," said Mr. Chi.

Finance - Banking - 4 key tasks to soon upgrade Vietnam's stock market — Deputy Minister of Finance Nguyen Duc Chi.

Third is the issue of information transparency of listed enterprises in both Vietnamese and English. According to Deputy Minister Nguyen Duc Chi, the Ministry of Finance will implement this in the first half of 2024, so that by the end of 2024, enterprises will basically meet this requirement.

Fourth, the new securities trading system must be put into operation as soon as possible, ensuring the requirements of transactions, payment and custody.

"Upgrading the Vietnamese stock market depends a lot on legal regulations and must be reflected in the reality of the market. Although the goal is very important, in any solution, the Ministry of Finance must manage risks, especially systemic risks, to ensure the market operates stably, safely and sustainably," Mr. Chi affirmed.

According to the Stock Market Development Strategy to 2030, the Government sets the stock market capitalization scale to reach 100% of GDP by 2025 and 120% of GDP by 2030.

Outstanding debt in the bond market will reach at least 47% of GDP (of which outstanding debt in corporate bonds will reach at least 20% of GDP) by 2025 and at least 58% of GDP (of which outstanding debt in corporate bonds will reach at least 25% of GDP) by 2030; the derivatives market will grow at an average of about 20 - 30% per year in the period 2021 - 2030.

The number of securities trading accounts of investors in the stock market will reach 9 million accounts by 2025 and 11 million accounts by 2030, focusing on developing institutional investors, professional investors and attracting the participation of foreign investors.

Increase the proportion of government bonds held by non-bank institutional investors to 55% by 2025 and 60% by 2030.

Strive to upgrade the Vietnamese stock market from a frontier market to an emerging market by 2025 according to the stock market classification standards of international organizations. Actively integrate into the world financial and stock markets, meet the requirements of financial security, improve competitiveness, risk management, apply international standards and practices; aim to reach the development level of the group of 4 leading countries in the ASEAN region by 2025 .

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