Vietnam’s Ministry of Planning and Investment (MPI) has urged authorities to allow eligible foreign-invested enterprises to float their shares on the country’s stock market as the government looks to scale up local capital markets.
The MPI and the government have received numerous petitions from foreign companies urging the government to enact related content of the Law on Securities that was passed in 2019 and took effect on January 1, 2021, Deputy MPI Minister Nguyen Thi Bich Ngoc said at a Wednesday conference on developing the stock market.
In addition, she suggested clarifying regulations on foreign ownership at listed companies in order to ease foreign ownership conditions for non-listed ones.
“[We] need to look into suggestions on soon relaxing foreign ownership limits (FOLs) at stock-exchange listed companies operating in certain industries and sectors,” the deputy minister added.
She showed her ministry’s support for efforts to upgrade Vietnam’s stock market status from a frontier to an emerging market as it will help boost foreign indirect investment.
In addition, Ngoc urged the Ministry of Finance and the State Securities Commission to soon issue an action plan to implement the strategy for stock market development until 2030 launched by the prime minister in late December, focusing on legal reforms to facilitate financial markets’ operations.
Other recommendations included stimulating the establishment of professional securities investment funds and companies, the introduction of new products like green finance and speedier privatization of state-owned enterprises, and raising effectiveness of management, supervision and early warning mechanisms.
At the conference, several participants, including a diplomat from the South Korean embassy in Vietnam and representatives from the World Bank, securities and fund management companies, recommended the Vietnamese government ease the FOLs in order to funnel more international investment into the local stock market.