On April 22 at a conference on Vietnam’s capital market chaired by Prime Minister Pham Minh Chinh, Mr. Zafer Mustafaoglu, Director of the World Bank (WB)’s Department of Finance, Competition and Innovation in East Asia - Pacific, said the success of the capital market’s development has opened up a diverse financial field and reduced excessive reliance on banks to provide long-term capital for investment. The market has, however, seen many acts in the opening months of 2022 that have caused market instability and investor insecurity.

As an international financial institution, the WB recommended six platforms to promote the efficiency of Vietnam’s capital market.

Firstly, supervising and effectively implementing policies and regulations are key to market growth. Secondly, infrastructure is not only needed for safe and effective transactions but is also a crucial element in the clarity and efficiency of the market. Thirdly, policies should pave the way for businesses to mobilize capital through suitable channels and ensure safety and proficiency.

Fourthly, protecting and educating investors should be prioritized. Fifthly, intermediary organizations, such as stockbrokers, must be required to hold certification, have suitable sorting, and be strictly supervised. And sixthly, understanding tools is essential to issuing policies, the process of authorizing and distributing bonds should be improved, and regulations on professional investors need to be removed but still create opportunities for businesses to participate in the market.

“Vietnam could consider enlarging the space on the stock market for international investors,” said Mr. Mustafaoglu. “A more in-depth and diverse market would cut down the chance of experiencing manipulation and exploitation.”