Market reform: The stock exchange in Ho Chi Minh City. Vietnam’s goverment is aiming to have the country’s stock market upgraded to ‘emerging-market’ status. — AFP
HANOI: Japan will continue to extend support for Vietnam’s stock market development through technical collaboration to boost equity, transparency and efficiency, says Vu Thi Chan Phuong, chairwoman of the State Securities Commission (SSC).
Her comment was delivered at the start of a seminar on the Japan International Cooperation Agency’s (Jica) technical cooperation project called “Enhancing Capacity for Boosting Efficiency in the Vietnamese Stock Market”, held in Hanoi on Monday morning.
The project is a follow-up to the “Enhancing Capacity to Improve Equity and Transparency of the Vietnamese Stock Market” project conducted by Jica from 2019 to 2023.
The project aims to enhance Vietnam’s securities market by improving management, oversight and function.
It includes strengthening surveillance of the SSC and stock exchanges to detect unfair practices, developing market intermediaries, managing listings and promoting investor protection and market transparency, Phuong said.
Furthermore, it strives to enhance the country’s stock market integration into the Asean and global arenas.
The leader of SSC said that the moment signifies the start of a new era of growth for the stock market, aligning with the goals set forth in the Securities Market Development Strategy through 2030.
The chief representative of Jica’s Vietnam office, Sugano Yuichi, said that the Vietnamese stock market has shown remarkable growth over the past 30 years, since it began in the 1990s.
Looking ahead, the Vietnamese government is actively working to elevate the market from “frontier” to “emerging” status.
With increasing interest from foreign investors, especially Japanese investors and a rising number of domestic investors, Jica has been implementing a technical cooperation project from April 2019 to March 2023.
The project aimed to enhance the capabilities of the SSC and stock exchanges while advancing the equity and transparency of the stock market, Yuichi added.
Through the endeavour, Jica has played a key role in improving the legal framework under the new Securities Law, including related decrees and circulars, and in the overall development of the market.
“The Vietnamese stock market is gaining traction as an attractive and conducive investment hub for businesses. This is the driving force behind Jica’s continued collaboration through the second phase of the project,” Yuichi said.
“The commencement of the second phase at this critical juncture, amid a period of transition, indicates a new chapter, propelling the Vietnamese stock market to greater heights of development.”
Chief adviser of JICA, Kojima Kazunobu, said that the biggest challenge of the previous project from April 2019 to March 2023, was that face-to-face activities were not possible from early 2020 to August 2022 due to the impact of Covid-19.
As a result, most of the project period was conducted online, and the expected results in terms of hands-on support, such as improving business flow, were not achieved.
However, he said he believes that with the implementation of the new project, the efforts of SSC and Jica could contribute to upgrading the Vietnamese market to emerging-market status and its integration into the international capital market.
By the end of August 2024, the stock market capitalisation had surpassed seven quadrillion dong or about US$280bil, marking a notable 19.1% increase from the end of 2023, which was around 69.2% of the estimated GDP for 2023.
Since the beginning of the year, the average transaction value has neared one billion dong, up 31.3% year-on-year.
Foreign investors currently hold about US$50bil worth of stocks, representing over 17% of market capitalisation. The figures underscore the significant growth of the stock market. — Viet Nam News/ANN
