Banking & Finance

Inflationary pressure and the Russia - Ukraine conflict have contributed to foreign investors leaving Vietnam’s stock market recently, offloading nearly VND7 trillion ($307.7 million) in shares since the beginning of March. But many analysts believe withdrawals will slow and then return as foreign investors recognize that economies like Vietnam’s will benefit from the greater economic openness to come.

The General Department of Taxation is promoting the deployment of the eTax mobile app to help individuals easily pay their taxes online. More than 60 million individuals have been granted tax codes to date, but in the first two months of 2022, only some 15,000 conducted their tax affairs via the eTax app.

The size of the corporate bond market has increased sharply in recent times, from 4.93 per cent of GDP in 2017 to 16.6 per cent in 2021. The market is likely to grow well this year due to supply and demand being maintained at high levels. Demand for issuances to ensure capital at enterprises is quite high. There will also be about VND266 trillion ($11.66 billion) of corporate bonds maturing this year.

The Asian Development Bank (ADB) and the Vietnam International Bank (VIB) have announced a three-year $260 million syndicated loan agreement to improve access to finance for SMEs and individual entrepreneurs. VIB will also implement a technical support program for female entrepreneurs, with a budget of $500,000. This is ADB’s first technical assistance provided to a Vietnamese bank to promote women’s entrepreneurship.

According to the State Bank of Vietnam (SBV), in order to develop an action plan to implement the government’s resolution on the Socio-economic Recovery and Development Program, the central bank will strive to cut lending interest rates by between 0.5 and 1 per cent in 2022-2023, especially for priority sectors, but will maintain lending conditions to ensure credit quality, control bad debts, and guarantee the safety of credit institutions.

On March 16, speaking at the APEC Finance and Central Bank Deputies’ Meeting 2022, Permanent Deputy Minister of Finance Tran Xuan Ha said that Vietnam’s fiscal and monetary policy will continue to focus on exemptions and reductions of taxes, fees, and charges, extensions to tax payment deadlines, interest rate support, debt rescheduling, preferential loans, and jobs support. At the same time, the country will allocate capital for infrastructure investment and improve its business and investment environment.