Representatives of international credit and finance organisations praised Viet Nam’s monetary policy and efforts to help the nation maintain macro-economic stability this year. — Photo shs.com.vn

Representatives of international credit and finance organisations praised Viet Nam’s monetary policy and efforts to help the nation maintain macro-economic stability this year.

They spoke at a year-end meeting at the State Bank of Viet Nam headquarters in Ha Noi on Monday, reported Thoi bao Ngan hang (the Banking Times).

Ousmane Dione, the World Bank Country Director for Viet Nam, said the central bank significantly contributed to stability and growth of the economy, and many countries would like to reach an economic growth rate of around 6 per cent that Viet Nam achieved.

HSBC Chief Executive Officer Pham Hong Hai said the central bank had effectively run the foreign exchange market in a proactive manner in 2016, despite global instability.

Hai said global and regional economies witnessed various fluctuations this year, such as the sharp depreciation of the Chinese yuan at the beginning of the year, and a British vote to exit the European Union last June.

“The SBV was right to change the way it manages exchange rates by setting a reference rate every day from the beginning of 2016, enabling the foreign currency market to operate flexibly following market rules. This helped the banking system avoid shocks involved in exchange rates,” he said.

Interest rates were also stable this year, helping enterprises reduce loan costs and support healthy economic growth. Money supplies were cautiously managed, supporting a national policy of curbing inflation, he added.

Hai also praised the central bank for its continuous efforts to restructure the banking system. “Of course it’s not easy to pursue this way, yet it is vital for sustained development of the banking area in particular, and the economy in general,” he said.

SBV Governor Le Minh Hung said the central bank had already completed plans to reorganise the banking sector over the next five years, focusing on handling non-performing loans and fragile credit institutions.

The plans also call for adjusting the Law on Credit Institutions, proposing more international standards in local institutions to boost transparency for more healthy and secure development.

Hung said the SBV acknowledged the policy advice of international organisations such as the World Bank (WB), International Monetary Fund and Asian Development Bank (ADB) that contributed to Viet Nam’s accelerated reforms.

“I believe that more active participation by you (foreign institutions) in this process will benefit us all,” he said.

Prime Minister Nguyen Xuan Phuc told a development forum earlier this month that the WB’s International Finance Corporation would assist Viet Nam in handling bad debts, while the ADB and a private partner were planning to acquire a local weak bank. — VNS