Vietnam bourse now unlikely before mid-1999
HANOI - Vietnam's long-planned
pilot bourse has been further delayed and is now unlikely
to open before the middle of next year, the official
charged with overseeing its establishment said on
Wednesday.
Le Van Chau, head of the government's State Securities
Commission (SSC), said the Asian economic crisis had
slowed plans for the exchange.
``In the wake of the regional financial turmoil we need to
be even more cautious in taking our steps,'' he told
American Chamber of Commerce members in Hanoi.
Chau said that it was hoped to have a pilot trading
centre open by the end of the second quarter of 1999,
but that this was not a fixed target.
``When we feel sure the market can be born safely, we
will do it,'' he added.
Chau said in July that it was hoped a pilot Securities
Trading Centre (STC) would be opened in the last
quarter of 1998 or the first quarter of 1999.
Vietnam has scaled back its aspirations and opted for an
incremental process towards establishing a stock
exchange.
``The STC will be set up as a pilot scheme for us to test
all the major functions of a fully-fledged stock
exchange,'' said Chau.
Most economists have said the STC would operate like
an over-the-counter market and a full exchange would
evolve in two or three years.
He added that during October the SSC planned to make
public the full regulations implementing July's landmark
decree on securities and a securities market.
But he said that while foreign participation was welcome
in the pilot market, the terms and conditions still needed
to be finalised.
``Foreigners may be allowed to buy and sell shares, but
to what extent still depends on the final decision of the
government,'' he said.
Market development had also been hampered by a lack
of firms that could be listed and by the slow pace of
equitisation -- communist Vietnam's preferred term for
full or partial privatisation of state companies.
``The pace of equitisation has been slow. It has now
been three years but there are only 39 equitised
businesses,'' Chau said.
Vietnam has around 6,000 state-owned enterprises.
``Even though we are moving very slowly I think we are
having firm steps,'' he added, saying that one of the
biggest obstacles had been widespread unwillingness
among state firm directors to open themselves to the
market and lose state protection.
Reuters - September 30, 1998.
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