Deputy minister of Finance Truong Chi Trung.— VNS Photo

by Vu Hoa

HA NOI (Biz Hub)— Viet Nam has praised the Government of Luxembourg's co-operation and support, especially in the finance sector.

Truong Chi Trung, deputy minister of Finance revealed this at the Viet Nam-Luxembourg Finance Forum in Ha Noi yesterday.

The forum was to mark the 40th anniversary of the establishment of diplomatic relations between the two countries.

Trung said the financial market in Viet Nam was in an early stage of development and it potential was huge.

"Viet Nam aims to develop the financial market in an efficient, open, transparent manner, moving towards international standards to create important funds and channels for the economy as well as develop regulatory tools to enable the market's stable development, to protect investors and internet services for users," he said.

Trung said Viet Nam had received invaluable support from Luxemburg in forms of experience sharing, capacity building and system equipment.

In recent years, Luxembourg had witnessed the highest growth rates in the European Union. The service sector and banking and financial services were the main drivers of that growth.

Trung said the two countries had signed a protocol on a project titled Development of capital markets in Viet Nam with a grant of three million euro.

In addition, in the Viet Nam-Luxembourg 2010-15 ICP, Luxembourg had offered to finance the projects in prioritised areas of development in Viet Nam.

Sameer Goyal, co-ordinator of the World Bank's Financial and Private Sector, said Viet Nam faced challenges in financial sector restructuring because legal, regulatory and supervisory framework continued to be behind international standards and practices.

He said banking sector assets had been nearly double the Gross Domestic Product (GDP) and required large resources while the Government did not have fiscal space.

He added the Government should maintain consumer confidence and undisrupted services.

Goval added that improving corporate governance was a must as bad management led to weak institutions.

Nguyen Thi Lien Hoa, vice chairman of the State Securities Commission (SSC) spoke about the achievements of the two countries in developing Viet Nam's securities market.

Hoa said Luxembourgh had helped the SSC in drafting professional manuals, finalising a legal framework governing operations in the market and supporting the legislation process to create a legal framework for new products.

Andrew Capon, banking and finance consultant, Lux-Development (LuxDev) said he looked forward to working closely with the SSC and other project beneficiaries to strengthen the Viet Nam securities market.

It would use a pragmatic and practical approach, stirring cross-institutional co-operation and responding to tactical needs of all players.

Luxembourg Ambassador to Viet Nam Marc Thill said his government was ready to give further support through vocational training and technical assistance.

Progress

"We are pleased to see steady progress in our economic relations with Viet Nam and we are happy to continue to promote Luxembourg's experience and know-how in the financial sector," he said.

Luxembourg is one of the leading financial centres in the world. It is host to 141 banks and 243 institutions active in the sectors of insurance and re-insurance.

The country holds an impressive six per cent market share in international private banking.

Within the international fund industry, it is second rank behind the US while it has become a leader in the cross-border distribution of investment funds. — VNS