Crystal balls a window into 2011’s prospects

January 09, 2011 | 16:45
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As the local stock markets step into 2011, VIR talks with market regulators and players to find out what they expect in the new year.

Minister of Finance Vu Van Ninh

Accelerating state-owned enterprises’ rearrangement is one of the important financial tasks in 2011 and for 2011-2015.

The Ministry of Finance will create more favourable conditions for the development of  capital, stock and property markets, based on market rules and compliance with international practices while ensuring transparency.

The government’s mobilisation of capital will depend on disbursement pace,  avoiding locking up capital and borrowing cost hikes. The debt indexes will be kept at a safe level to guarantee effective capital usage while debt repayments being made in time to not badly impact on the international commitments.

The total government bond issuance in 2011 is expected to be VND45 trillion ($2.3 billion).

David Kadarauch, head of research at Mekong Securities Company

So many investors in the world are paying attention to Asia including Vietnam, but they face many administrative barriers. Vietnam needs to modify its regulations to make account-opening easier, reduce T+ and allow investors to use services at more than one securities company.

This will help Vietnam’s stock markets attract remarkable foreign capital sources and reduce balance of payment pressure, thus to lessen pressure on the local currency and stabilise the forex market.

There will be hardly any risks in such changes. Therefore, there is no reason for these changes not to be carried out immediately.

Otherwise, Vietnam will waste time and regress compared with many regional peers. We hope that in 2011, authorities will have far-sighted vision and be aggressive in solving the mentioned-above problems.


Phuong Hoang Lan Huong, general director of Vietnam Securities Depository (VSD)

First of all, to enhance the service quality, VSD is reconstructing its website. Our new website would be up and running soon, providing many additional facilities.

For example, it offers detailed information on issuance organisations, and allows issuance organisations and depositors to update their information on the website themselves. The English version will also be launched.

In 2011, VSD will continue investing in IT infrastructrure. Accordingly, electronic verification will be put into place. We will also roll out the project of allowing more than one bank to involve in payment activities.


Nguyen Van Dung, general director of Tan Viet Securities Incorporation

Vietnam’s economy faces many challenges. Firstly, the imbalance between savings and investment demand is growing. Secondly, the trade gap has gone up.

Thirdly, the inflation rate has strongly fluctuated over the past years with remarkable increases. Big foreign capital inflows together with high domestic credit growth have brought about significant inflationary pressures.

However, from 2011, these shortcomings and difficulties will be gradually overcome. The impressive consumption growth is the premise for enterprises to expand their markets. Thus, the local stock markets in 2011 will be more favourable against 2010.

Drastic measures to prevent stock price manipulation in the past time have been brought fairness for investors. Yet, management authorities need to strengthen investigation and inspection to guarantee a fair playground for market members.


Tran Van Dung, general director of Hanoi Stock Exchange

There are at least three bright points for the stock market in 2011. Firstly, the gross domestic product (GDP) growth goal is still high at 7-7.5 per cent, while public investment from government bond sources is to selectively decrease from VND56 trillion ($2.87 billion) to VND45 trillion ($2.3 billion). Thus, the capital sources will be concentrated on efficient projects, helping reduce inflation pressures.

Secondly, the amended Securities Law becoming effective will be the basis to amend, supplement and release new under-law documents such as decrees and circulars. Many matters regarding new products and unsound regulations will be sorted out to bolster the market.

Regarding challenges in 2011, if the bank lending rate does not go down to a reasonable level, enterprises will continue issuing more shares, pressuring the supply side. Therefore, it is high time to consider raising the criteria for share issuing and listing.

vir.com.vn

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