Developing the private economy:

Many businesses will be listed on the stock market.

The stock market will see more private companies listed in the near future. *Photo: Trong Hieu*

According to Nguyen Minh Giang, Head of Asset Management at Mirae Asset Securities Joint Stock Company, Resolution No. 68-NQ/TƯ has had a positive impact on investor sentiment. Investors have gained confidence in the stock market, leading to a strong upward trend.

That's the short-term impact. In the medium and long term, when Resolution No. 68-NQ/TƯ comes into effect, with many important policy groups such as facilitating private businesses' access to resources like land, capital, and high-quality human resources...; especially, the decriminalization of civil and economic relations will help entrepreneurs dare to think, dare to act, and boldly invest capital in business, thereby increasing capacity, competitiveness, and operational efficiency, which means that the market capitalization of enterprises on the stock exchange will increase accordingly.

Furthermore, Resolution No. 68-NQ/TƯ will stimulate the return of foreign capital to the Vietnamese stock market. A more open mechanism for private enterprises and an improved investment and business environment will attract both domestic and foreign investment. Foreign investment funds will not only cooperate with private enterprises in implementing projects but also choose to invest in the companies' shares.

Sharing the same view, Nguyen The Minh, Director of Retail Client Analysis (Yuanta Vietnam Securities Company), said that Resolution No. 68-NQ/TU is modern because in developed countries, private enterprises are the main driving force for economic growth. With this resolution, when the private sector is promoted, the number of listed companies on the stock market will increase, the products on the market will be more diverse and abundant, and investors will have more quality investment choices, helping to increase liquidity and attractiveness of the market, and expand the market size.

According to Mr. Nguyen The Minh, the biggest limitation in the current stock market is the monotonous range of products and the lack of large-cap stocks. The large-cap group is currently mainly banking and real estate; however, the real estate sector is cyclical, so the stock market is also affected by this cyclical nature. Furthermore, the investor structure is heavily skewed towards domestic individual investors, who prefer short-term trading, making the market easily influenced by sentiment and short-term fluctuations...

Some other experts argue that promoting the private economy means building strong private enterprise models. To become strong, these businesses must be listed on the stock market because it offers access to more capital.

Opportunities for the capital market

Regarding the prospects and potential of shares of large listed companies, Cao Thi Ngoc Quynh, Director of Institutional Clients (VNDirect Securities Joint Stock Company), stated that Resolution No. 68-NQ/TƯ clearly outlines the expansion of private enterprise participation in nationally important projects. The State proactively implements policies for ordering, limited bidding, or direct contracting, and offers preferential policies to encourage the private sector to participate alongside the State in strategic areas, key projects, and scientific research tasks.

Therefore, businesses in sectors such as energy, construction materials, infrastructure, and technology will benefit and experience breakthroughs when they receive preferential development policies and participate in major national projects such as the North-South high-speed railway project, urban railways, renewable energy projects, and digital transformation projects…

Experts also recognize that the development of the private sector not only contributes to economic growth but also creates momentum for the domestic capital market. From there, the stock market further enhances its role as an effective channel for raising capital for businesses.

According to Mr. Nguyen The Minh, Resolution No. 68-NQ/TƯ both boosts the market capitalization of listed companies and encourages unlisted companies, or small and medium-sized enterprises, to view this market as the optimal place to raise capital. Previously, businesses relied heavily on the banking system for capital raising, putting considerable pressure on the banking system. Resolution No. 68-NQ/TƯ not only promotes the market capitalization of listed companies but also acts as an impetus to encourage businesses to raise capital on the stock market instead of relying on the banking system.

Meanwhile, Mr. Nguyen Minh Giang expressed the view that, with the open mechanism of Resolution No. 68-NQ/TƯ, the number of newly established businesses as well as businesses expanding production and business will certainly increase sharply in the coming time. Consequently, the capital of credit institutions will not be sufficient and will have to seek other sources, namely the stock market.

Source: https://hanoimoi.vn/phat-trien-kinh-te-tu-nhan-dong-luc-lon-cho-thi-truong-chung-khoan-704074.html