WORDS ON THE STREET 70th anniversary of Hanoi's Liberation Day Vietnam - Asia 2023 Smart City Summit Hanoi celebrates 15 years of administrative boundary adjustment 12th Vietnam-France decentrialized cooperation conference 31st Sea Games - Vietnam 2021 Covid-19 Pandemic
Home / Economy / Banking & Finance
Vietnam projected to be upgraded to Secondary Emerging by 2020: Brokerage
Ngoc Mai 11:14, 2019/10/01
Addressing the two remaining prerequisites for reclassification only requires a new decree or circular issued by Ministry of Finance, instead of going through many processes subject to approval from the National Assembly.
Vietnam may be upgraded by global provider of financial services FTSE Russel in the 2020 review period, after being retained on watch list for possible reclassification in this year review, according to Bao Viet Securities Company (BVSC). 
 
Illustrative photo.
Illustrative photo.
Following this year’s assessment, Vietnam was unable to gain the nod for moving to Secondary Emerging, due to the country’s stock market having not made any significant improvement since being included in the list of upgrades in the September 2018 review.

“Additional improvements are sought with regard to the registration of new accounts where market practice can extend the registration process and also the introduction of an efficient mechanism to facilitate trading in securities that have reached, or are approaching, their foreign ownership limit between non-domestic investors,“ stated FTSE in a statement.

FTSE also said there has been constructive interaction with the Vietnam market authorities over the last twelve months, and recognized Vietnam’s efforts to develop and improve the capital market.

Currently, Vietnam has only met seven out of nine prerequisites for a reclassification, in which two criteria that need to be improved are "Settlement – Rare incidence of failed trades" and "Off-exchange transactions permitted". 

FTSE also explained why "Off-exchange transactions permitted" remains at "Restricted", due to the requirement of fund availability before trade execution, as guided in Circular 203/2015/TT-BTC. Notably, this is also the reason that "Settlement – Rare incidence of failed trades" was downgraded from "Pass" to "N/A" in the March 2019 interim country classification review. 

BVSC expected that overcoming this factor is crucial for Vietnam to be upgraded in the next review. As this would be  a guide in a circular, the changes will not go through many processes and take a lot of time as the amended Securities Law requires National Assembly approval. 

Therefore, FTSE’s announcement reinforces the idea that Vietnam may be upgraded by FTSE in the 2020 review period because at that time, the amended Securities Law would likely have been approved while defects identified by FTSE during this review period can be mended by a new decree or circular issued by Ministry of Finance, stated BVSC. 
Other news
22:02, 2024/12/17
Regional, international financial centers mean boosters to Vietnamese economy: Deputy PM
Ho Chi Minh City envisions its financial center encompassing the money market, banking system, capital market, and derivatives market.
15:44, 2024/11/14
IFC sets record with US$1.6 in climate financing to support Vietnam’s green transition
The new commitments aim to bolster Vietnam's shift towards a low-carbon economy while enhancing private-sector resilience and competitiveness.
21:44, 2024/11/11
Vietnam's credit growth up 10% in 10 months
Vietnam’s central bank has set a credit growth target of around 15% this year.
08:08, 2024/10/05
Building Hanoi's smart city with smart banking
In Hanoi's smart city development strategy, smart payment and open banking ecosystems are critically important.
21:34, 2024/09/19
Vietnam stock market clears major legal hurdle to potential upgrade
Starting November 2, foreign investors will no longer be required to pre-fund 100% of their transactions, promising the removal of a major roadblock for Vietnam's market upgrade process.
17:29, 2024/09/01
Cashless parking in Hanoi: Good model fuels smart transport
Hanoi’s leaders believe that all that's left to do is act with the ultimate goal of serving people from smart transportation, armed with the mindset and solutions of a new global vision and thinking.