On the morning of February 28, 2024, in Hanoi, Prime Minister Pham Minh Chinh chaired the Conference On the Deployment of Tasks for the Development of the Stock Market in 2024. The conference was attended by Deputy Prime Minister Le Minh Khai; leaders of various ministries, departments, agencies, representatives of diplomatic missions, international organisations, banks, associations, and listed companies on the stock market.

Prime Minister Pham Minh Chinh chaired the Conference – Photo: VGP/Nhat Bac

At the conference, Madame Nguyen Thi Mai Thanh, Chairwoman of the Board of Directors of Refrigeration Electrical Engineering Corporation (REE), delivered the following speech:

Madame Nguyen Thi Mai Thanh, Chairwoman of the Board of Directors of Refrigeration Electrical Engineering Joint Stock Company (REE) gave a speech on the topic “Stock market 2024 – Perspective from the issuer” – Photo: VGP/Nhat Bac

Everyone knows that the capital market, including the stock market, is the backbone, the lifeblood of the economy. In 2000, the Vietnam stock market was established as a channel for capital mobilization in line with the issued legal framework.

To mobilise capital at a reasonable cost and sustainably in the long term, REE was a pioneer to be first listed on the Ho Chi Minh City Stock Exchange (HOSE) and received listing license number 1 in July 2000. At the time, this idea was relatively new in Vietnam.

However, Vietnam has always been self-learning and chooses for itself successful models to apply in building and developing a market economy with a socialist orientation. REE has actively embraced new ideas, applied them with a determination to achieve success, proving the value and efficacy of the Party’s and State’s roadmap and policies.

Indeed, REE has succeeded with the model of equitisation and listing, serving as an encouragement for other businesses to follow. Today, most Vietnamese enterprises have been equitised, and the majority have achieved success. The State still holds a percentage along with the business, and the State benefits from the achievements that the equitised business brings.

The stock market is not only a “training ground” for listed companies to conduct themselves more properly in business, to become more transparent, to act more responsibly towards stakeholders such as investors, sponsors, customers, employees, as well as tax obligations to the State. It also indirectly trains professional, diligent, and honest managers, through whom they can rise to keep the value of shares continuously increasing.

The stock market model is one that Vietnam has adopted early, contributing to creating an effective capital mobilisation channel in addition to traditional channels like banks.

We believe that alongside bank loans, the capital mobilisation through stock issuance on the stock market and corporate bond issuance are two extremely important and useful channels for businesses in serving medium- to long-term development. This is also the main reason REE volunteered to list first. Through this market, REE has issued shares 8 times and raised 2,800 billion VND for expanded investment and continued development.

And REE always places proper care in investor concerns, as committed in the information disclosure, and issuance documents. We understand that issuing bonds and shares requires transparency, and businesses must place themselves within an enhanced high legal and responsibility framework.

More than anyone else, the company’s Board of Directors must be responsible for the periodic disclosure of information and closely monitor the use of mobilised capital to ensure it is properly and effectively allocated.

In summary, businesses wanting continuous development need a continuous supply of capital, among which capital coming from the issuance of shares and bonds is very abundant and needs to be further strengthened and promoted.
On this occasion, we propose:

Listed companies are “goods” on the stock market, and goods must be of good quality and there must be no counterfeit goods. Investors always expect listed companies to experience good growth and they are ready to invest more toward this goal. The current critical issue for businesses in general and listed businesses in particular, besides financial, technology, or management capability issues, is:

• The legal framework and policies need to be stabilised for the long term. We recommend that the Government continues to create a more open and transparent business legal environment, move towards a one-stop service, reduce the ask-and-give mechanism, gradually shift to a registration mechanism and businesses being empowered within the legal framework – if something is not forbidden, it can automatically be done.
• We see the Prime Minister’s business trips focusing on calling for and promoting economic development. The Prime Minister has mentioned almost all sectors of the economy. We trust that the Government is encouraging overseas Vietnamese to continue to be the main driving force for Vietnam’s economic development. The current obstacles are slow administrative procedures lacking efficiency.
• Regarding the current VN30 index, the stocks in the VN30 and VN100 baskets include shares of 30 businesses with the largest market capitalization and liquidity. If only these criteria are considered, most of the shares from industries typifying the economy are not fully represented. Perhaps there should be other criteria so that businesses from different industries placed in this basket will represent the economy.
• Regarding bank interest rates… how to make interest rates for businesses return to more reasonable levels? We believe that the State Bank needs to pay more attention, to bring interest rates back to a reasonable level so that businesses can utilise bank financing alongside bond and share capital to continue to develop, contributing to the economy.
• Regarding tax declaration and payment, we think it also needs to be fairer, meaning that everyone doing business must voluntarily declare and pay taxes. Businesses on the listed market have very complete reports and we see that the tax authorities regularly review and inspect the taxes of these businesses. However, we also see that other industries have not achieved similar numbers. Therefore, the State’s tax revenue is lost, and the source of revenue is incomplete.

To see more information about the Conference on the Deployment of Tasks for the Development of the Stock Market in 2024, please visit the following link: baochinhphu.vn