Luxembourg assists Vietnam finance sector to develop

Truong Chi Trung, Deputy Minister of Finance made the remark at the Vietnam-Luxembourg Finance Forum in Hanoi on June 18, as part of activities to mark 40 years of the two countries’ diplomatic ties.

Trung said Vietnam’s financial market is in its infancy and its potential is huge.

“Vietnam aims to develop the financial market in an efficient, open, transparent manner, and up to international standards to create important funds and channels for the economy,” he said.“it is developing regulatory tools to enable the market’s stable development, to protect investors and internet services for users.”

Trung said Vietnam has received invaluable support from Luxembourg in forms of experience sharing, capacity building and system equipment.

Over the years, Luxembourg hasachieved the highest growth rate in the European Union. The service sector and banking and financial services are the main drivers of that growth.

Trung said the two countries have signed a protocol on a project titled Development of capital markets in Vietnamwith a grant of EUR3 million.

In addition, in the Vietnam-Luxembourg 2010-2015 ICP, Luxembourg had financed the projects in prioritized areas of development in Vietnam.

Sameer Goyal, co-ordinator of the World Bank’s Financial and Private Sector, said Vietnam faces challenges in financial sector restructuring because legal, regulatory and supervisory framework is yet to meet international standards and practices.

He said banking sector assets have nearly doubled the Gross Domestic Product (GDP) and required large resources while the Government did not have fiscal space.

The Government should maintain consumer confidence and undisrupted services, he said, adding that improving corporate governance is a must as bad management led to weak institutions.

Nguyen Thi Lien Hoa, vice chairman of the State Securities Commission (SSC), spoke about the achievements of the two countries in developing Vietnam’s securities market.

Hoa said Luxembourg has helped the SSC draft professional manuals, finalize a legal framework governing operations in the market and support the legislation process in creating a legal framework for new products.

Andrew Capon, banking and finance consultant, Lux-Development (LuxDev) said he looksforward to working closely withthe SSC and other project beneficiaries to strengthen the Vietnam securities market.

It would use a pragmatic and practical approach, stirring cross-institutional co-operation and responding to tactical needs of all players.

Luxembourg Ambassador to Vietnam Marc Thill said his government is ready to give further support through vocational training and technical assistance.

“We are pleased to see steady progress in our economic relations with Vietnam and we are happy to continue to promote Luxembourg’s experience and know-how in the financial sector,” he said.

Luxembourg is one of the leading financial centres in the world. It is host to 141 banks and 243 institutions active in sectors of insurance and re-insurance.

The country holds an impressive six percent market share in international private banking.

Within the international fund industry, it is second rank behind the US while it has become a leader in the cross-border distribution of investment funds.