At a meeting of the Business Roundtable in Hanoi on January 8-9, Prime Minister Nguyen Tan Dung and leading investors discussed a number of important issues aimed at promoting the country’s rapid and sustainable economic growth.
One of the Government’s top priority issues is to attract and make full use of foreign investment sources for economic development and particularly to develop the country’s transport, power and information and technology sectors.
However, it will take time for the Government to build a roadmap for attracting more foreign investment in order to ensure the stable and sustainable development of the retail network and the permitted level of foreign share holding in State-owned enterprises and State commercial banks.
PM Dung welcomed foreign investors’ purchase of shares in State businesses and State commercial banks.
“This is a necessary step towards ensuring the sustainable development of the economy and the interests of investors,” he said, adding that the current regulations allow foreign investors to hold 49 percent of the capital at equitised State enterprises and 30 percent at equitised State banks.
Under its commitments to the World Trade Organisations, Vietnam will have to open up many economic sectors. This will pose many challenges and also present opportunities for the Southeast Asian economy to gather experience and overcome weaknesses in management, scientific and technological development and human resources.
April 1, 2008 will mark a milestone in the history of Vietnam’s financial and banking sector as wholly owned foreign banks will then be allowed to operate in the country. Thomas Tobin, President and Executive Manager of the Hong Kong-Shanghai Banking Corporation (HSBC) Vietnam said that the move will make domestic banks sharpen their competitive capacity and provide better services to clients while increasing their capital and risk management capacity.
With its rapid economic growth, Vietnam is considered a “rising star” in Asia and is expected to attract more foreign investment in 2008 and over the coming years. The crux of the matter is how to use the source of foreign investment effectively to ensure a harmonious and sustainable development, address pressing social affairs, narrow the gap between rich and poor and prevent wastefulness and environmental pollution.
Though it will be difficult to achieve a two-digit growth rate like China’s, Vietnam’s GDP rate is forecast to remain high in the coming years. Peter Ryder, Executive Manager of Indochina Capital Group, expressed his confidence that Vietnam’s economic growth will be steady like that of the Republic of Korea and Japan. He quoted PLC – Asia’s leading security research organization, as saying that in 2007 Vietnam ranked second in the world and first in Southeast Asia in terms of financial security. This is an important factor in helping Vietnam to attract more foreign investment, said the CEO.
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