Co-Organized by:

Socialist Republic of Vietnam Ministry of Finance

Regional experts gathered together at the Vietnam Finance and Capital Markets Conference 2007 held early this week to discuss the latest issues of the fast growing capital markets in Vietnam. The event was co-organized by the Ministry of Finance and the EuroEvents, which aimed to discuss the latest issues of the fast growing capital markets in Vietnam.

The two-day conference attracted about 600 Vietnamese and 200 foreign delegates. Addressing the opening ceremony, Finance Minister Vu Van Ninh said: "To make progress in the economic development, the Vietnamese government always give priorities to reforming and developing the financial and capital market".

"In the time to come, the Finance Ministry in co-ordination with other governmental agencies to continue improving the legal frameworks, implementing WTO's commitments, applying cautious and flexible finance management policies with a view to stabilising macroeconomic targets, creating stable social and political environment for investment and economic development," Mr Ninh said.

Mr. Klaus Rohland, Country Director of Vietnam, The World Bank, Mr. Sin Foong Wong, Country Manager of Vietnam, Laos, Cambodia of International Finance Corporation (IFC) and Dr. Omkar Shrestha, Deputy Country Director, ADB Viet Nam Resident Mission joined the Vice Finance Minister Tran Xuan Ha to discuss on how Vietnam can attract more capital flow and the overview of the progress of the financial reform. Dr. Shrestha said that Viet Nam was targeting a very high rate of investment against GDP in the years to come.

The rate has steadily increased from 30 percent during the 1990s, which was already high, to 37-38 percent currently, and for the years to 2010 the rate was expected to rise to 40 percent, he said. Mr. Klaus Rohland stressed that authorities needed to work closely to manage money flows and minimise risks in the capital market.

Deputy Finance Minister Tran Xuan Ha, said that the State Bank would join efforts with the State Securities Commission to moderate the stock market. Chairman Vu Bang of the State Securities Commission examined the legal framework of the new securities laws with Dr. Ulrike Maenner, Chief Technical Adviser, GTZ, Mr. Nguyen Hoang Anh, Partner, Johnson Stokes & Master, Mr. Trieu Quoc Viet, Financial Sector Specialist, The World Bank. All speakers highlighted the importance of the new laws and how it has been shaping the development of the domestic capital markets and the fledgling stock market. While Chairman Vu Bang said that the Securities Law has gone a long way to minimize administrative hurdles to listing on the market, he ruled out raising the 49 percent limit on foreign ownership of listed stocks in the short term. "It does not mean that the government will not open the door, but it should not be done at such a hot time," Bang said.

He said companies needed to publish more information to protect investors and amendments to the Securities Law passed last year would require businesses to do so.

Mr. Le Dao Nguyen, Deputy General Director, of BIDV led the discussion on the benefits of Equalization of SOEs and the attractiveness of the equitized companies to the investors. Also on the panel were Dr. Le Duc Tho, Director of Vietinbank, Mr. Le Song Lai, Executive Director, State Capital Investment Corporation, Mr. Ngo Phuong Chi, Deputy Director, Bao Viet Securities Company and Ms. Nguyen Thi Mai Thanh, Managing Director, REE Company.

Any impressive array of speakers from the leading local and foreign banks discussed the issues of the debt capital markets in Vietnam and brainstormed on how to make the markets more active. It started by a presentation from Mr. Jimmy Choi, Vice President of Deutsche Bank, covering both the international and domestic bond issuance matters. The two panel discussions covered both the primary and secondary markets and it highlighted how the industry is working together with the regulators in developing the debt capital market. Vietnam Bond Market Forum, a voluntary group formed by the market practitioners, said they are gaining supports from different parties and is closed to form a formal association to promote professional trading conducts.

The second day opened with Mr. Phung Khac Ke, Deputy Governor, State Bank of Vietnam highlighting the challenges of WTO integrations and Mr. Nguyen Doan Hung, Vice Chairman, State Securities Commission looked at how to boost the domestic capital markets. Mr. Nguyen Doan Hung sent a strong signal to investors that the MOF, SSC will continue the measures for sustainable investment of the capital, securities markets to create a safe, transparent, effective environment for investment and investors protection.

Representatives from the two local exchanges discussed with the representatives from the Hong Kong Stock Exchange and the London Stock Exchanges on the listing issues. The comparisons of local and foreign listings were highlighted.

The event concluded with the investment funds panel discussion with the fund managers and analysts agreed that the Raging Vietnam stock market needs correction and slow down. All panelists warned that stock prices are overvalued.