|Although we do not have specific numbers to measure the success of the trip, I think this is an important background and it shows the interest of UK enterprises in Vietnam.|
JOURNALIST: - UK ranks 15th in terms of countries investing in Vietnam. Till the end of 2018, the total accumulated registered investment capital of UK in Vietnam was USD 3.75bn. This is the background to promote relationship between two countries, as well as creating opportunities to develop the financial markets of UK and Vietnam. What do you think about this trip?
Minister DINH TIEN DUNG: - I think this was a very successful trip as the potential from UK financial market is huge. I met with several authorities, in which I was so impressed by Philip Hammond, the Minister of Treasury in UK. He was very interested in Vietnam. He asked many questions, why Vietnam chose UK to promote FII and why Vietnam was late in privatization of State Owned Enterprises (SOEs).
I told him that Vietnam was in the process of reforming its economy. Vietnam had achieved the highest economic growth rate. In prior years, Vietnam had promoted FII in Japan, US, Korea. This time Vietnam continued this strategy in Europe and UK. About the privatization process, I said Vietnam had completed IPO of small SOEs and was speeding up the process to privatize the other ninety big SOEs. The domestic funds were limited that’s why Vietnam had to raise capital from outside.
I also explained that the capital raising was just a part of the strategy, the other key thing was Vietnam needed the cooperation of foreign companies in restructuring Vietnamese enterprises, helped these companies in applying international standards, increased transparency and approached and opened markets to global ventures.
Furthermore, London played a very important role in the international financial market, hence, Vietnam highly appreciated the potential of the UK financial market. Although Vietnam and UK business relationship had risen to new levels, it was still lower than fully meeting actual potential.
After meeting with Philip Hammond, I worked with the managers of Stock Exchange London, and the Assistant to the Prime Minister of UK. Both parties agreed to promote bilateral trade and investment between two countries as UK is preparing to leave EU.
The other thing that impressed us was when we invited 100 companies to the investment forum but more than 200 companies joined. UK investors asked about policies, strategies of Vietnam in attracting FII. The forum lasted longer than our expectations.
Following the forum, there were more than 50 private meetings between authorities and enterprises of Vietnam with enterprises of UK. Although I cannot measure the specific result, it shows the interest of UK enterprises in Vietnam.
It is important to attract Foreign Direct Investment (FDI), but it is the same with FII. FII helps improve corporate governance. Currently, the total value of FII in Vietnam is about USD 39-40bn and most of this capital is long term, hence, we should not worry much about the massive withdrawal of capital by foreign investors.
- The question is what we should do to realize the potential and attract foreign investors to invest in Vietnam?
- The foreign investors were also concerned about this issue and I said there were many policies that we needed to revise, such as Security Law. The New Security Law would be more close to international practices. About the other bottlenecks like issuing the registered number for foreign investors, deposit to buy government stake… Vietnam would soon amend the regulations. The more detailed the questions of investors, the more they are interested in Vietnam. The potential for Vietnam in the mid and long term is huge.
- We already had an investment promoting trip to Japan, Korea. What are the results of these trips?
- We will have the detailed data later, but in general the interest of foreign investors in Vietnam has been rising. A clear signal is that FII to Vietnam has increased every year. Currently, the total value of investment portfolio of foreign investors is USD 39-40bn and in the first 6 months the net FII was USD 1.2bn, while in other stock markets the foreign investors showed net withdrawal.
- What do you think about Vietnam’s capital market in coming times?
- We are living in a very complicated world where many issues occur at the same time, hence, we have to watch and tackle these issues closely. In my opinion, the most important thing is to keep the macro economy stable. If we can do that, the capital market will be stable. At the same time, we should maintain the exports which will help balance the economy. These factors will make our capital market more attractive and attract more foreign investors.
- Thank you very much.