Magazine article Business Asia

Vietnam Seeking Equities Market to Woo Investors

Magazine article Business Asia

Vietnam Seeking Equities Market to Woo Investors

Article excerpt

The Vietnam Government is developing a pilot equities market in an effort to regain foreign investment that has dried up because of Asia's financial crisis.

Prime Minister Phan Van Khai wants the State Securities Commission to set up an "over the counter" trading market in Ho Chi Minh City.

Some economists had expected the government to set up a pilot market in Ho Chi Minh City by the end of the year and follow up with Hanoi if the first one was successful. A full-fledged stock market is not expected for up to three years.

However, Prime Minister Khai has given no timeframe for setting up either centre.

Mr Don Lam, senior manager of financial advisory services for PricewaterhouseCoopers, said the exchange would initially trade government bonds and some of the 18 companies in Vietnam that have already been privatised.

PricewaterhouseCoopers believes unprecedented foreign investment incentives will soon be available in Vietnam.

The impact of Asia's financial crisis has prompted Vietnam to implement plans to aid its economy, which has been hurt by the withdrawal of regional investors.

The government has a privatisation schedule for the next three years.

Small- to medium-sized companies will be privatised over the next six to 12 months, with the exception of strategic bodies involved in industries such as telecommunications, petrochemicals and air transport.

Some large national corporations are likely to be privatised by the turn of the century, while opportunities should arise next year among subsidiaries of monopolistic corporations. …

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