~ Le Viêt Nam, aujourd'hui. ~
The Vietnam News

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Vietnam to expand its booming stock market

HANOI - Vietnam will allow more share listings, improve the legal framework and restructure its small but fast-growing stock market this year, the state-run Tin Tuc newspaper reported on Wednesday. The measures would boost the stock market's capitalisation to $20 billion by the end of the year, or 30 percent of gross domestic product, it quoted State Securities Commission chairman Vu Bang as telling an industry meeting.

The Finance Ministry would also seek to expand the operation of stock broking firms and boost surveillance to improve transparency and corporate governance, Bang told ministry officials at the meeting in Hanoi on Wednesday. Vietnam would need to upgrade the market's information technology, provide more training for staff and raise public awareness of securities investment, the meeting heard.

The Ho Chi Minh City Securities Trading Centre opened in July 2000 and now trades shares in 105 companies and Sacombank as well as certificates of two investment funds and a number of government bonds. A rash of IPOs and share debuts by several major companies and banks in the last quarter of 2006 before the end-December expiry of government tax relief for listing firms has lured foreign and domestic investors. "The awareness and knowledge of companies and people on the stock market has risen significantly," Finance Minister Vu Van Ninh was quoted as saying last week in an interview with the ministry-run Vietnam Financial Times newspaper. "This is a good base to develop the stock market into a long-term fund raising channel for the economy," Ninh said.

Vietnam aims to expand the economy by up to 8.5 percent this year after 8.17 percent growth in 2006. Reflecting investor interest and the economic growth, the Vietnam share index ended 2006 at 751,77 points, a rise of 144.5 percent over the year, making it one of the world's fastest growing indices. Market capitalisation was $9 billion. The index hit a lifetime high on Wednesday, rising 2.46 percent to close at 865.71 points. This week, the State Securities Commission have the exchange the right to issue listing licences. It also plans to match orders continuously from April compared with three times daily.

In the Hanoi over-the-counter market , where 86 companies and a bank are listed, the index also hit a lifetime high on Wednesday at 291.2 points.

Reuters - January 10, 2007.