Vietnam won’t let stock market to go down

Vietnam won’t let stock market to go down
16:44' 07/03/2008 (GMT+7)
VietNamNet Bridge – The recent moves by the State Bank of Vietnam of tightening the monetary policy has made some people think that curbing inflation is the top priority of the Government now, for which, Vietnam may sacrifice the stock market. However, people have been reassured that the Government won’t let the stock market to go down.

Le Thi Bang Tam, former Deputy Minister of Finance wrote on Dau tu chung khoan that she personally believes that the Government will not let the stock market to go down further, and it absolutely does not want the gloomy days in the first period of the stock market to come back.

Tam said that investors should keep calm with the share price falls. They should not think that the VN Index has to march towards the 1,100 point level after it reached 1,000 points already.

Le Dang Doanh, former Head of the Central Institute of Economic Management, Senior Economist, also said that the Government needs to take actions to recover and stabilize the stock market.

Doanh said that as the stock market remains fledgling, it needs support to develop in the right track. If the market bogs down, investors will flea from the market for ever, and it will take much time and efforts to restore the market.

The Government has to protect the stock market, because the stable stock market will help attract more investments and develop other markets, including the capital market, gold and real estate markets

The fact that Government’s officials and officials from relevant ministries these days sit together to discuss the solutions to rescue the stock market shows that the Government will not sacrifice the stock market to focus on curbing inflation.

However, experts said that the Government does not intend to rescue the market by violating market rules. It will not throw money to the market to buy shares or subsidise share prices, but it will use suitable financial tools.

Le Xuan Nghia, Director of the Banking Development Strategy Department under the State Bank of Vietnam also said that he does not believe that the Government will pump money into the stock market. Nghia said that in other countries in the world, governments never do that, because they believe that the national economy and investors will decide the health of the stock market.

A lot of measures have been released to rescue the stock market. Companies have been asked to reconsider the IPO and additional share issuance timetable in order to avoid the share dilution and oversupply of commodities. Besides, a cautious monetary policy is being applied in order to curb the inflation and support the stock market development.

(Source: Lao dong, SGTT, DTCK)