Developing Vietnam - US economic relations on the basis of comprehensive cooperation

(Editor's note): On July 2, in Vietnam, a ceremony was held to celebrate the 20th anniversary of the normalization of diplomatic relations between Vietnam and the United States and the 15th anniversary of the signing of the bilateral trade agreement. Previously, on July 1, in New York City (USA), a working delegation of the Vietnamese Government led by Vietnamese Finance Minister Dinh Tien Dung held an investment promotion conference with US investors. During those 20 years, the economic - investment - financial - trade cooperation between Vietnam and the United States has been continuously built and developed; bilateral foreign exchanges in various fields, especially in the financial field, have grown strongly in recent years.

At this conference, with the participation of leading domestic and international news agencies, Minister of Finance Dinh Tien Dung discussed with the press important contents in economic and financial relations... which Vietnam is striving to open up to integrate into the international economy. Nghe An Newspaper respectfully introduces to readers the content of this discussion.

Conference overview

PV:Dear Minister, after the investment promotion conference in Japan in 2014, attracting hundreds of large investors interested in investment opportunities in Vietnam, could you please tell us the basic goal of the 2015 investment promotion conference held in the US financial and economic center this time?

Minister Dinh Tien Dung: Starting in 2013, during the State visit of President Truong Tan Sang to the United States, the leaders of the two sides agreed to upgrade the relationship between the two countries to a comprehensive partnership. This investment promotion conference in the United States is a testament to the development of the Vietnam - US relationship, while also creating opportunities for the Vietnamese and US business communities to meet and cooperate to promote the development of relations in many aspects between the two countries. The main message conveyed to US investors at this conference is to build a more comprehensive and extensive partnership in the fields of finance and capital markets between Vietnam and the United States for the mutual benefit of both sides.

As we know, the United States has the largest economy and financial market in the world, both a center for attracting capital in the world and a place to spread these capital flows. Vietnam is assessed by many financial institutions as a potential emerging market with the ability to rise in attracting indirect investment compared to other countries in the region. However, the image of the Vietnamese market for US investors is not really clear, so when promoting investment in the United States, we want US investors to clearly understand the efforts and successes in the process of economic reform in Vietnam, especially the consistent policy of the Vietnamese Government to firmly develop the economy according to market mechanisms, as well as always respect and appreciate foreign investment flows, especially capital flows from US investors.

The Vietnamese Government and Ministry of Finance are also making efforts to improve institutions, mechanisms, and legal frameworks to increase the attraction of foreign investment capital. The clearest evidence is that the Government has just signed Decree No. 60, which includes opening up and attracting foreign capital.

Delegates exchange on the sidelines of the investment promotion conference with US investors.

PV:With the current capitalization scale equivalent to 31% of GDP, in the goal of making the stock market a key and effective channel for mobilizing and leading medium and long-term capital for the economy, what are the solutions that the Ministry of Finance has implemented and will implement in the coming time, Minister?

Minister Dinh Tien Dung: We all know that, in a unified whole of economic development, the financial system plays an important role, with the task of coordinating, promoting, and interacting to create the development of different economic sectors. Therefore, in the coming time, on the part of the Ministry of Finance, with our role, we will focus on implementing a number of basic solutions in fiscal policy: continuing to increase revenue collection capacity and control the level of deficit spending; implementing savings and improving efficiency of use; ensuring the safety of public debt and foreign debt; improving the level of national credit; closely coordinating with monetary policy to ensure macroeconomic stability.

Regarding the restructuring of SOEs, the Ministry of Finance is determined to equitize SOEs and divest non-core capital according to plan, especially equitization of large-scale SOEs; apply modern governance principles and public and transparent information disclosure; ensure the operation of SOEs according to market mechanisms; strengthen supervision of state capital investment in enterprises; sharply reduce the state ownership ratio in equitized SOEs; allow a large proportion to be sold to foreign strategic partners; require equitized SOEs to list and register for trading on the stock market.

In the securities sector, we will focus on promptly guiding and actively implementing Decree No. 60 on amending and supplementing Decree 58/2012 guiding the implementation of a number of articles of the Securities Law, which was issued a few days ago, including increasing the foreign ownership ratio in public companies; implementing solutions to upgrade the Vietnamese stock market from the group of frontier stock markets to the group of developing stock markets on the MSCI table; building a system of insurance funds, voluntary pension funds, supplementary pension funds, establishing a credit rating organization; reforming administrative procedures, building an online code granting system for foreign investors.

In addition, we will organize the construction of a derivatives market to put into operation in 2016; continue to improve requirements for information disclosure, transparency and corporate governance according to international practices; modernize the organization of the trading market, clearing and payment systems; perfect the tax mechanism applied to the securities sector according to international practices to encourage long-term investment.

PV:After 20 years of normalizing Vietnam-US relations, US investors are now ranked 7th in terms of direct investment in Vietnam. In the financial market, hundreds of investment organizations have poured capital into Vietnamese enterprises through large investment funds. According to the Minister, what favorable conditions does Vietnam currently have to further strengthen economic relations with the US and attract more large capital flows from the US?

Minister Dinh Tien Dung: Currently, the relationship between Vietnam and the United States is developing very favorably, so the economic relationship between Vietnam and the United States and the potential to attract large capital flows from the United States to Vietnam also have many prospects for development. Firstly, peace and development cooperation continue to be the major trends in the world. Secondly, the Asia-Pacific economic region continues to become the most dynamically developing region in the world, in which cooperation between countries in the region is increasingly close, especially the upcoming Trans-Pacific Partnership Agreement (TPP).

Third, the comprehensive partnership between Vietnam and the United States has been established, increasingly affirmed and strengthened between the leaders of the two states. This is an extremely favorable factor for developing economic relations as well as attracting investment capital from the United States to Vietnam. In addition, economic - investment - financial - trade cooperation between Vietnam and the United States has been continuously built and developed over the years, specifically in the field of investment, the United States is among the top 10 countries with the largest direct investment capital in Vietnam; in the field of finance, many large US financial corporations are present in Vietnam such as JPMorgan Chase, CitiGroup, Goldman Sachs, Morgan Stanley... and many other investment funds; Regarding trade relations, Vietnam's export scale to the United States by 2014 reached nearly 29 billion USD, 36 times higher than in 2000, becoming the largest exporting country of the ASEAN region to the US market...

Thus, it is easy to see that the trend of international integration and cooperation among countries is increasingly expanding both regionally and globally. In the general trend of the world, the economic relationship between Vietnam and the United States on the basis of comprehensive cooperation and developed over the past 20 years will continue to have a strong breakthrough in both quality and quantity in the coming time.

PV: Thank you very much, Minister.

Performed by: Song Hong