Building a stable and sustainable stock market in Vietnam

The upgrade of Vietnam's stock market is an important milestone in its journey of more than 25 years of development.

On October 8, Minister of Finance Nguyen Van Thang answered the press interview after FTSE Russell announced upgrading Vietnam's stock market from frontier to secondary emerging.

Reporter: As the leader of the Finance sector, how does the Minister assess the significance of this event?

- Minister NGUYEN VAN THANG: Over the past 2 years, under the attention and strong leadership of the General Secretary , the Government, the Prime Minister and the close direction of the Ministry of Finance, the State Securities Commission has implemented a comprehensive reform program, bringing the Vietnamese stock market closer to the highest international standards.

We are delighted that FTSE Russell has officially upgraded Vietnam's stock market from frontier to secondary emerging. This result comes from the correct direction and determination of the Government, the close coordination of the State Bank, ministries and branches, the companionship of market members, and the valuable support from the World Bank, FTSE experts and global investment institutions.

Vietnam's stock market still has a lot of work to do after being upgraded. Photo: HOANG TRIEU

The upgrade of Vietnam’s stock market is an important milestone in its 25-year development journey. This event not only opens up opportunities to attract large foreign capital flows but also affirms Vietnam’s correct direction and capacity to deeply integrate into the global financial system.

Many opinions say that upgrading will open a new door for the quality of development of Vietnam's securities. What is the Minister's opinion on this?

- I completely agree with the assessment that upgrading Vietnam's securities market is a turning point, opening up great opportunities to improve the quality of market development. However, the Ministry of Finance has determined that upgrading is not a destination but a journey to develop the Vietnamese securities market to grow in quality, transparency and sustainability.

The upgrading of Vietnam's stock market is the result of a series of drastic directions and efforts in recent times, marking a comprehensive transformation of the market - from the legal framework, technology infrastructure, product and service quality to business performance and public investment behavior. This event not only marks a major step forward in the quality of development and international integration but also opens up new opportunities for the Vietnamese stock market in the future.

What exactly is that journey, Minister?

- The Project to Upgrade the Vietnamese Stock Market, which has just been approved by the Prime Minister, has also set short-term and long-term goals. Accordingly, in addition to the goal of fully meeting the criteria for upgrading from a frontier market to a secondary emerging market of FTSE Russell in 2025; we must also maintain the secondary emerging market rating of FTSE Russell, meet the criteria for upgrading to an emerging market of MSCI and an advanced emerging market of FTSE Russell from now until 2030.

FTSE Russell’s official announcement of upgrading Vietnam’s stock market is just the first step. We have many bigger goals ahead, requiring the implementation of more drastic and seamless solutions to maintain the development momentum, improve the quality, transparency and international integration of Vietnam’s stock market.

The Ministry of Finance expects the upgrade to be a turning point for the capital market in general and the Vietnamese stock market in particular; not only attracting high-quality foreign capital but also setting higher requirements on corporate governance, publicity and transparency. This will encourage management agencies, market members, businesses and investors to jointly upgrade, bringing the Vietnamese stock market to a new level, contributing significantly to the sustainable growth of the country's economy.

Can the Minister share the Ministry of Finance's solutions for the stock market to develop sustainably, truly becoming an important medium- and long-term capital mobilization channel for the economy?

- The Vietnam Securities Development Strategy to 2030 aims to build a stable, safe, healthy, efficient and sustainable market with good risk tolerance, with a reasonable market structure, becoming the main medium- and long-term capital mobilization channel for the economy.

The strategy emphasizes scale growth associated with quality improvement, development of green and sustainable financial instruments, promotion of digital transformation, application of modern technology in management and supervision, and enhancement of international integration to narrow the development gap with advanced markets.

Therefore, in the coming time, the Ministry of Finance will direct the State Securities Commission and related units to resolutely implement solutions, creating the most favorable conditions for domestic and foreign investors. The Ministry will complete the legal framework, promote modernization and digitalization of infrastructure, aiming to build a Vietnamese stock market that is increasingly transparent, efficient, modern, and meets leading international standards.

Mr. HUYNH ANH TUAN, General Director of Vikki Digital Banking Securities Company (VikkiBanks): Not a "magic wand"

The upgrade of Vietnam's stock market is not a "magic wand" that can immediately attract a massive influx of foreign capital. This is the result of a long reform process, but it still takes time for the money to really flow in strongly. That also explains why, despite many positive signals, foreign investors have still sold more than VND90,000 billion since the beginning of the year. Foreign investors have their own perspectives, influenced by many factors such as exchange rates, interest rates, investment efficiency or the prospects of each market.

The upgrade not only has symbolic meaning but also affirms that the Vietnamese stock market foundation has reached international standards and is fully capable of meeting many new expectations in the future.

In the short term, the market will have a clear differentiation between industry groups, depending on business results and prospects after upgrading. Most importantly, the "health" of enterprises and the way the market operates transparently and in accordance with the rules will be the decisive factors for the sustainable development of Vietnam's securities market in the coming period.

Mr. PHAM LUU HUNG, Chief Economist of SSI Research: VN-Index may head towards 1,800 points

The upgrade of Vietnam's stock market is not only a milestone to celebrate but also a long journey full of efforts of all market members. It can be said that "happiness lies in the journey, not the destination". Over the past time, the Government, the Ministry of Finance, the Securities Commission and the exchanges have continuously reformed to meet international criteria, from creating transparency in margin trading for foreign investors, shortening the time to open accounts to amending laws, promoting IPOs and listing new shares.

The successful operation of the KRX trading system is a big step forward, helping the Vietnamese stock market get closer to global standards. With what has been achieved, I believe that Vietnamese stocks will not be in the low group when upgraded, but in the middle group, or even the top group.

Upgrading is not the only factor that helps the stock market grow, because positive business results are the real driving force. According to SSI Research's forecast, VN-Index can aim for the 1,800 point mark in 2025, reflecting the health and positive outlook of Vietnamese enterprises.

Son Nhung recorded

Source: https://nld.com.vn/xay-dung-thi-truong-chung-khoan-on-dinh-ben-vung-196251008221832393.htm