According to Chairman of the State Securities Commission of Vietnam (SSC) Tran Van Dung, South Korea is currently the biggest foreign investor in Vietnam, and its increasing presence in Vietnam’s stock market is helping attract indirect Korean investment in the country.
Some 4,850 Korean investors currently take part in Vietnam’s stock market
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Korean indirect investment is rising sharply though it has yet to match potential, Dung said, noting that 4,846 Korean investors are present in Vietnam’s stock market.
There are five South Korea-invested securities companies in Vietnamese stock market at present, namely Korea Investment & Securities, Mirae Asset Daewoo, Shinhan Investment, KB Securities and Woori, Dung said, adding that these securities firms, together with banks and representative offices of fund investment companies from the South Korea, are playing an important role in boosting the inflow of Korean indirect investment into Vietnam.
The Northeast Asian nation is also running projects in securities with Vietnam. The Hanoi Stock Exchange and the Ho Chi Minh Stock Exchange are working to update their technological system with the help of the Korea Stock Exchange. Meanwhile, the SSC and the Korea Financial Investment Association are discussing a deal on financial technology, he added.
Though the Korean financial investment in Vietnam has grown strongly over the past year it is not on par with potential. However, Dung said, opportunities in Vietnam are opening and Korean investors should not miss them.
Experts also said that Vietnam’s stock markets are attractive to foreign investors, including South Korean, especially when 64 state-owned enterprises (SOEs) will become equitized while 181 others will be divested from now to 2020. The shares of large conglomerates will be put on sale, including Binh Son Refinary, PV Oil, PV Power and Electricity Generator No.1, No.2 and No.3.
There are many attractive business fields for South Korean investors to pour money, such as seaports, logistics, aviation and real estate, they said.
However, they suggested as the demand for development investment capital will be big soon, Vietnam’s stock market must develop more strongly to supply medium- and long-term capital for the economy.
According to Dung, SSC will strive to attract FDI into Vietnam, through building a stable, safe, fair, open and effective stock market, to protect the interests of investors and respect market rules, gradually integrating with other stock markets in the region and the world.
In addition, it will further accelerate the listing of large-scale equitized SOEs and reduce State ownership to bolster attractiveness besides diversifying products on the stock market (covered warrants, government bond futures, options contracts, new stock indexes) to ensure that foreign investors have more investment opportunities and a range of investment products in accordance with investment needs and time limits.
“SSC will also implement solutions to upgrade Vietnam’s stock market from the group of marginal stock markets to the group of developing stock markets in the MSCI Vietnam Index,” Dung said.
Especially, Dung said, to attract foreign indirect investment from South Korea, the SSC will strengthen cooperation with the South Korea’s managerial agencies to learn about Korean investors’ investment demand, and then both sides will remove obstacles to Korean investment in Vietnam’s stock market.
