Japan is set to continue its technical cooperation to assist the State Securities Commission of Vietnam (SSC), stock exchanges, and related entities in advancing the fairness, transparency, and efficiency of Vietnam’s securities market during this new phase of development. This initiative was the focal point of discussions at the seminar held on September 23 in Hanoi, launching the Japan International Cooperation Agency (JICA) project on “Enhancing the Capacity and Efficiency of Vietnam’s Securities Market.”
The goal of this technical cooperation project is to strengthen the capabilities of the SSC and the three major stock exchanges in Hanoi and Ho Chi Minh City through close consultation and capacity-building activities. The project will focus on market surveillance and oversight, regulation of intermediaries, management of securities listings and public offerings in line with international standards, and improving the accountability of listed companies in protecting investor interests.
This project builds upon the previous JICA project implemented between 2019 and 2023, which aimed to improve the fairness and transparency of Vietnam’s securities market. According to Vu Thi Chan Phuong, Chairwoman of the SSC, Vietnam’s securities market has achieved remarkable results since its inception, benefiting from favorable policies and effective legal reforms. The SSC has established a comprehensive legal framework to ensure the market’s safe and transparent operation. By the end of August 2024, the market capitalization of Vietnam’s securities market reached VND 2.8 quadrillion, a 19.1% increase compared to the end of 2023, equivalent to 69.2% of Vietnam’s 2023 GDP.
Since the beginning of 2024, the average daily trading volume has approached $1 billion, marking a 31.3% increase from the 2023 average. Currently, there are 728 listed stocks and 878 UPCOM stocks, with a total value of VND 2.246 quadrillion, up 5.5% from the end of 2023. Foreign investors hold approximately $50 billion in stock value, representing over 17% of the total market capitalization. These figures demonstrate the robust growth of Vietnam’s stock market.
Chairwoman Vu Thi Chan Phuong also emphasized that the securities market is now entering a new phase of development, aligned with the goals of the strategic plan for market development through 2030. JICA Chief Representative in Vietnam, Sugano Yuichi, highlighted that Vietnam’s securities market has grown rapidly in recent years, with the government striving to elevate it from a frontier market to an emerging market. To enhance the attractiveness of the securities market and position it as a preferred investment destination, JICA will continue its cooperation, launching the second phase of the project.
Specifically, JICA will support the project in four key areas: strengthening the SSC’s and stock exchanges’ capacity for market surveillance to detect and address unfair practices (including in the derivatives market), improving the regulation of market intermediaries, enhancing investor protection, and effectively utilizing self-regulatory organizations while promoting the growth of institutional investors.
Key Takeaways:
- Project Objective: Improve the transparency, fairness, and efficiency of Vietnam’s securities market through technical cooperation that enhances market oversight and management capabilities.
- Market Growth: As of August 2024, the market capitalization of Vietnam’s securities market reached VND 2.8 quadrillion, a 19.1% increase from the end of 2023, reflecting strong growth momentum.
- International Cooperation: JICA will continue and expand its previous project, helping Vietnam’s securities market elevate its regulatory and operational standards to international levels.
- Future Outlook: As Vietnam aims to upgrade its securities market to emerging market status, the second phase of JICA’s collaboration will support the achievement of the market’s development goals through 2030.
