Viet Nam’s exports are growing, but its industries are not proceeding at the same pace, an expert noted at the Nikkei Asian Review forum held in Ha Noi on Wednesday.

While the meeting was optimistic in general about Viet Nam’s growth prospects, several speakers highlighted key areas for improvement while acknowledging the big strides that the nation has taken thus far.

The forum brought together Vietnamese and Japanese government officials as well as businesspeople of both countries.

Speakers said there were enough grounds for optimism about the continued development of the capital market in Viet Nam, with GDP growth forecast to remain high for the next five years and the Government’s divestment plans increasing market liquidity and investment opportunities.

Pham Hong Son, Vice Chairman of the State Securities Commission (SSC), remarked that the Vietnamese stock market was the fastest growing one in ASEAN.

After 17 years of growth, Viet Nam’s stockmarket is more than 63 per cent of the country’s GDP, with over 700 listed companies and 640 registered, 23 of which are valued at over US$1 billion. And out of over 1.8 million trading accounts opened, 23 thousand are owned by foreign investors, Son said.

He also cited the SSC’s findings that the stock and bond markets capitalization are now equal to 100 per cent of GDP and current credit balance at 130 per cent of GDP.

This suggests that Viet Nam’s financial and monetary markets are gradually achieving a more balanced and stable structure than in the past, he said.

Shosuke Mori, deputy head of international banking unit at Sumitomo Mitsui Banking Corp, congratulated Viet Nam on achieving steady growth over the past 20 years, using well its various advantages including a large population, open and favourable business environment for foreign enterprises, and economic and political stability.

However, Mori also commented that the Vietnamese economy still faced many challenges and shortcomings, including the restructuring of state-owned enterprises and developing higher added value for domestic industries.

He also said that the proportion of domestic purchases was also very low compared to other countries in Asia. Therefore, Viet Nam should strengthen domestic firms’ competitiveness to increase domestic purchasing power, he said.

Mori also appreciated Viet Nam’s development potential for tourism, considering the nation an attractive destination for many foreign visitors and suitable for the development of a non-cash economy to add to the tourists’ convenience.

Nguyen Duy Hung, Chairman and Chief Executive Officer of Saigon Securities Inc (SSI), said that with its abundant and young human resources as a solid foundation for business, Viet Nam has been an attractive investment destination for foreign partners, including those from Japan.

Hung said Vietnamese enterprises have been closing the gap between them and their regional partners, with the government pitching in with favourable policies.

More and more major State-owned enterprises are being equitised, generating development opportunities for investors and the stock market.

The Vietnamese Government has undertaken important reforms in recent time, paying particular attention to attracting foreign investment, Hung said.

Titled “Nikkei Asian Review Hanoi Forum - Highlighting Vietnam’s Growth Outlook - Designing Strategies for the Next Stage”, the meeting was Nikkei’s first event held outside Japan and also the first of its kind in Viet Nam.

It was jointly organised by Japan’s Nikkei Inc and the Embassy of Japan in Viet Nam with support from the Ministry of Planning and Investment. — VNS