Despite challenges ahead, experts in the banking and securities industry expect the stock market to see a gradual recovery given an expected improvement in economic conditions this year.
Trinh Hoai Giang, deputy general director of HCMC Securities Corporation:
Both local and foreign investors are looking to Vietnam in 2013 and a better macro-economic situation will help attract cash flow into the stock market. However, I think that the Government will have to solve many problems and has yet to take strong measures for the State-owned enterprise restructuring scheme. Improving capacity instead of investment is an urgent issue.
The stock market will not recover until interior problems of the economy such as bad debt and inventory are solved. If the problems still remain, foreign investors will be hesitant at investing in the local market.
Nguyen Do Lang, chairman and general director of APEC Securities Company:
The economy will turn better in 2013 but at a slow rate. Especially, the stock market will not be as bad as the final half of 2012. I think that the local economy has hit the rock bottom and all information of bad debt and stockpile has been priced in the market. Slow or quick recovery of the economy depends on determination of the Government.
For securities firms, I think that only 50% of securities enterprises can survive this year, as scheduled by managing agencies. Large enterprises that will still exist will have many opportunities to hold bigger market share. But if enterprises have incurred debts in previous years, they will face difficulties this year as bank capital may not flow into the stock market as much as before. Besides, strict regulations in Circular 210 will force many firms to close down if they fail to improve their current situation.
CEO of a big securities firm:
The problem of 2013 is the real estate market. Many property firms listed on the stock market have a strong capital source, creative business and large-scale projects but they are running the risk of insolvency. They even have to sell their buildings to pay debts. If the Government wants to give financial support to buyers, the policy should reach the right beneficiaries. Otherwise, a wrong demand stimulus like in 2009 may occur. The right thing is to reduce tax and land use ownership transfer fees to help enterprises cut prices, recover the real estate market and reduce bad debts in banks.
I think that this year’s economic situation will not be too bad as the Government has figured out problems in previous years and is handling them. The VN-Index may reach 450 points this year if the Government’s projects are implemented.
Trinh Van Tuan, chairman of Orient Commercial Bank:
I hope that the macro economy will see fewer difficulties this year thanks to solutions suggested by the Government. The Government has chosen the inflation curbing target instead of economic growth. Specifically, credit growth in 2013 is set at just around 6-7%. This is a right choice.
The Government’s measures are rather late but better late than never. The problem is realizing what have been scheduled. In fact, people will not see many shocks like in 2012 as they have already known the bad economic situation. However, much effort is needed to help the economy gain strong growth like in previous years. The most important thing is that the economy will be able to reach sustainable development and avoid serious consequences in the coming year.
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