Vietnam News Agency talks with Minister of Finance Hồ Đức Phớc about recent developments in Việt Nam’s stock market and his ministry’s response to such events.
In light of recent turbulence experienced by the stock market, especially the sharp fall on April 25, what solutions have been put in place to reassure investors by the Ministry of Finance?
The ministry views the stock market as a key channel to funnel investment into the economy for the medium-term and long-term. With a goal to ensure sustainable and transparent development of the stock market, the ministry has proposed and introduced a number of amendments to the country’s current stock market regulations including the issuing and offering of company bonds to domestic and international buyers.
Regarding the event on April 25, the ministry as well as the State Bank of Vietnam and the Ministry of Public Security have released a public statement to denounce the rampant baseless rumours that caused temporary panic among some investors.
We have, however, implemented a number of steps to ensure the rights of investors and companies, including those who have been found to be rule-breakers. The ministry wants them to have a chance to address the damage caused by their violations, help mitigate losses by investors, protect jobs and possibly make a comeback.
Recently, Prime Minister Phạm Minh Chính on behalf of the government said Việt Nam will refrain from over-criminalising civil cases. How will it affect the stock market?
It’s important to note that the government’s top priority is the sustainable and robust development of the stock market and the rights of investors and companies. Recent arrests of certain business executives were meant to be a warning shot, not an escalation of law enforcement, in a bid to steer the stock market back to a path that will ensure stability and fair play for all.
In the coming months, the ministry is to take measures to raise awareness of the country’s Business Law and Securities Law as well as other stock market-related regulations among the business and investor community. It is our hope that businesses and audit firms will learn to play by the rules and understand that violations will have consequences.
In other words, audit firms are to be held jointly responsible for their client audit reports. Violations may result in their licenses being revoked and heavy financial penalties. The ministry considers said responses as deterrents as well as measures to protect the rights of investors and bond issuers.
Some investors have voiced their demand for more stringent regulations to oversee the stock market. What is the ministry’s stand on said demand?
We understand that the market has its own rules but such rules must also adhere to the country’s legal framework. Our view is that the State still has a significant role to play in guiding the development of the stock market. The ministry’s focus is on what measures to put in place to prevent unfairness, abuse and exploitation. Violations must also be severely punished to ensure an environment that is fair-for-all and transparent.
Working in tandem with stricter punishments, the ministry is also to step up scrutiny on inspection and audit activities. For us, this is a top priority as we value the stock market highly as a channel to seek investment for the country’s socio-economic development. VNS