Prime Minister: Establish an international advisory team to build a financial center in Vietnam

On the evening of January 17 local time, Prime Minister Pham Minh Chinh chaired a discussion on "Potential and investment opportunities in Vietnam's financial market". Photo: VGP/Nhat Bac

The event was organized by the Ministry of Planning and Investment, the Swiss Bankers Association, VinaCapital Investment Fund and CT Group. This is one of the important events during the Prime Minister's working trip to Switzerland, because this country with a small area and population is one of the largest financial centers in the world.

Attending the seminar were Minister of Planning and Investment Nguyen Chi Dung; Minister of Foreign Affairs Bui Thanh Son; Minister of Industry and Trade Nguyen Hong Dien; Minister of Science and Technology Huynh Thanh Dat; Minister of Education and Training Nguyen Kim Son; Governor of the State Bank of Vietnam Nguyen Thi Hong; Chairman of Ho Chi Minh City People's Committee Phan Van Mai; leaders of a number of ministries, branches and localities.

In particular, the seminar was attended by many experts and leaders of large financial corporations such as: Former Swedish Prime Minister Carl Bildt; former German Deputy Prime Minister, Dr. Philipp Rösler; Chairman of the Swiss Association of Banks and Asset Managers (VAV) Pascal Gentinetta; Chairman of the largest Northern European banking group SEB Marcus Wallenberg; Vice Chairman of the Swiss Stock Exchange Soren Mose; leaders of the largest Swiss bank UBS, Blackrock Switzerland (Switzerland's No. 1 asset manager), Standard Chartered, Commerzbank Switzerland (Switzerland's leading bank), HSBC Asia Pacific, Hyosung Group (Korea)...

Dr. Philipp Rösler commented that Vietnam has been one of the fastest growing countries in the world in recent years, but this is just the beginning and countries are looking towards Vietnam. Photo: VGP/Nhat Bac

Countries are looking towards Vietnam

In his opening remarks, Dr. Philipp Rösler stated that Vietnam is one of the fastest growing countries in the world in recent years, but this is just the beginning and other countries are looking towards Vietnam.

With the assessment that Vietnam is on the way to becoming a financial center and can completely make a leap in this field, representatives of corporations and banks expressed their impressions of Vietnam's achievements after the COVID-19 pandemic; focusing on analyzing Vietnam's potential, advantages, models and experiences in building an international financial center - recommendations for Vietnam, conditions and foundations for building a financial center and attracting investment, such as legal conditions, tax policies, electricity infrastructure, information technology, transportation, skilled labor, macroeconomic stability, etc.

Mr. Claudio Cisullo - representative of UBS Bank said that Vietnam is one of the countries with very good conditions to develop a financial center, and also has a very special opportunity to transform itself through technology and can avoid the "mistakes" and wrong choices of previous countries.

Mr. Cho Huyn-sang, Vice President of Hyosung, said that many Korean companies want to be present in Vietnam. With an annual revenue of 25 billion USD, this group has invested 3.5 billion USD in Vietnam and has about 9,000 Vietnamese employees.

Assessing the investment in Vietnam as one of the most reasonable and effective investments, Hyosung plans to increase its investment capital in Vietnam to 5.5 billion USD by 2024.

He assessed that Vietnam's strengths are the strong and effective leadership and management of the Central Government, the active support of local authorities, and the hard-working and serious spirit of the Vietnamese people.

Mr. Don Lam, General Director of VinaCapital, said that there are currently 200 YPO member enterprises interested in Vietnam in a variety of fields - Photo: VGP/Nhat Bac

Mr. Don Lam - CEO of VinaCapital said that the Young Global Leaders Organization (YPO) decided right after the discussion with the Prime Minister to organize a business delegation to Vietnam (expected in February 2025). Currently, there are 200 YPO member businesses interested in Vietnam in very diverse fields.

Delegates also asked many questions about Vietnam's regulations and policies. Photo: VGP/Nhat Bac

According to leaders of ministries, sectors and Ho Chi Minh City at the seminar, Vietnam is assessed by international organizations as a potential financial center, converging many factors to develop a modern financial market, aiming to form a highly connected financial center.

These factors include stable macroeconomic and political conditions; favorable geographical location, high connectivity; different time zones from the 21 largest financial centers in the world associated with strategic geo-economic location, this is a unique and special advantage in attracting idle capital during trading breaks from these centers.

At the same time, institutions, mechanisms and policies have been improved; administrative procedures and business regulations have been reduced; the investment and business environment has been improved; innovation and start-up have been strongly promoted. The scale of the economy and the level of development of the financial market have been increasingly improved.

Vietnam is gradually perfecting its legal framework, promoting restructuring and building strategies for developing financial markets (banking, insurance, securities). This has attracted the attention of many investors, especially foreign investors, to participate in the financial market.

Delegates also asked many questions about Vietnam's regulations and policies related to the capital ownership ratio of foreign investors in credit institutions, human resource training, talent attraction, roadmap for opening the financial market to retail companies, and implementation plan of the Political Declaration on the Fair Energy Transition Partnership (JETP).

Minister of Planning and Investment Nguyen Chi Dung said Vietnam is in great need of advice, initiatives and support from major financial institutions in building a financial center in Ho Chi Minh City - Photo: VGP/Nhat Bac

Chairman of Ho Chi Minh City People's Committee Phan Van Mai said that according to the plan, by 2030, the City will form a regional financial center and this year must submit to the National Assembly a legal framework for this center and continue to update and supplement it.

The city will also continue to improve infrastructure, especially in District 1 and Thu Thiem; train and attract high-quality human resources to meet the requirements of an international financial center.

Chairman of the Ho Chi Minh City People's Committee Phan Van Mai said that according to the plan, by 2030, the city will form a regional financial center. Photo: VGP/Nhat Bac

In response to delegates’ concerns about the foreign investor ownership ratio, SBV Governor Nguyen Thi Hong said that according to current regulations, the share ownership ratio of a foreign individual cannot exceed 5% of the charter capital of a Vietnamese credit institution. This ratio for a foreign organization is not to exceed 15%, and for a foreign strategic investor is not to exceed 20%. The total share ownership ratio of foreign investors is not to exceed 30% of the charter capital.

However, in special cases to restructure weak and struggling credit institutions and ensure the safety of the credit institution system, the Prime Minister shall decide on the foreign investor's shareholding ratio in each specific case.

However, according to the Governor, in reality, foreign investors currently only own about 15% of charter capital at some banks, which is far from the prescribed limit.

Vietnam combines major policies smoothly

After the leaders of ministries, branches and localities responded to the opinions of the delegates, concluding the discussion, Prime Minister Pham Minh Chinh acknowledged, thanked and agreed with the ministries, branches, representatives of the world's leading banks and financial investment funds on the establishment of a Working Group to research and advise on the construction of a financial center in Vietnam, chaired by Dr. Philipp Rösler, Minister of Planning and Investment Nguyen Chi Dung, and Chairman of the Ho Chi Minh City People's Committee Phan Van Mai.

The Prime Minister informed delegates about the process of gaining independence, the country's development path and the situation of Vietnam after nearly 40 years of renovation, and reviewed some outstanding achievements and results. In particular, by the end of 2023, Vietnam attracted a total registered FDI capital of more than 468 billion USD, disbursed about 300 billion USD. In 2023, people and economic organizations deposited about 13.5 million billion VND in banks, the highest ever, showing improved income and people's confidence.

The Prime Minister said that by mobilizing all resources, developing rapidly and sustainably on the basis of science, technology, innovation and digital transformation, Vietnam aims to become a developing country with modern industry and high middle income by 2030; and by 2045 to become a developed country with high income.

In particular, Vietnam is focusing on sustainable development based on three pillars: Socialist democracy, Socialist rule of law and socialist-oriented market economy. Throughout the process, progress, social justice and the environment are not sacrificed for mere economic growth; people are placed at the center, the subject and the most important goal for all development policies.

The head of the Vietnamese Government affirmed that the Vietnamese Government always accompanies and creates favorable conditions for foreign investors in general and investors from Switzerland in particular to invest and do business effectively and sustainably in Vietnam. Photo: VGP/Nhat Bac

Along with that, Vietnam implements an independent, self-reliant, diversified, multilateral foreign policy; is a good friend, a reliable partner and a responsible member of the international community; implements the "4 no's" defense policy; builds a progressive culture imbued with national identity, because "where culture exists, the nation exists", "culture lights the way for the nation to go".

Currently, Vietnam is implementing three strategic breakthroughs including: Building and perfecting institutions and laws; reforming administrative procedures, training high-quality human resources; developing strategic infrastructure, especially transport infrastructure, with the motto "open policies, smooth infrastructure, smart management".

With the viewpoint that "resources come from thinking, motivation comes from innovation, strength comes from the people", Vietnam is renewing the old driving forces of "export, consumption and investment" and adding new driving forces such as digital economy, green economy, circular economy, sharing economy, and knowledge economy.

Another highlight is that Vietnam is stepping up the fight against corruption and negativity, and Vietnam's strong efforts and determination to fight corruption have been recognized in international rankings.

"Vietnam skillfully combines major policies to create a peaceful environment, political stability, social order and security, creating conditions for investors to operate effectively, sustainably and long-term," said the Prime Minister.

Prime Minister and delegates attending the discussion. Photo: VGP/Nhat Bac

The Prime Minister asked experts, banks, and financial investment funds to support Vietnam in policy advice; promote startups and innovation; restructure banks; build and enhance national brand value; support infrastructure development; train human resources, etc.

Prime Minister Pham Minh Chinh hopes that global corporations and investment funds will share their experiences and provide advice on choosing appropriate development models and solutions to develop a financial center in Vietnam, develop a financial ecosystem, improve national credit ratings, and enhance standards in accounting, auditing, and financial reporting, creating an important foundation for the successful development of an international financial center in the future.

Along with that, research the possibility of participating in investment and restructuring weak banks in Vietnam; accompany and support Vietnam in training and developing high-quality human resources for the financial services sector, meeting standards and in line with the needs of the global market.

The Head of the Vietnamese Government affirmed that the Vietnamese Government always accompanies and creates favorable conditions for foreign investors in general and investors from Switzerland in particular to invest and do business effectively and sustainably in Vietnam.

The Government will promote its role as a creator, always accompanying, sharing, listening, and accepting the opinions of businesses and investors for mutual development; commit to protecting the legitimate and legal rights and interests of investors in any circumstances, not criminalizing economic relations; in the spirit of "harmonizing benefits, sharing risks", "harmonizing interests between the State, people, and businesses".

The Government will also continue to review mechanisms, policies, and legal tools to promote anti-corruption, anti-negativity, reform, cut administrative procedures, create a fair, transparent, and healthy playing field, and minimize input costs and compliance costs for investors, increasing the competitiveness of products and services.

Source