Fiscal and monetary policies should be coordinated to promote the recovery of financial market

VCN - On June 16, the scientific conference "Reshaping the financial market for economic recovery and development" was held by the National Institute for Finance.
Fiscal and monetary policies should be coordinated to promote the recovery of financial market
Scene of the conference. Photo: Thùy Linh

Need solutions to develop financial markets

Speaking at the conference, Assoc. Prof. Dr. Nguyen Nhu Quynh, Director of National Institute for Finance, said that the Covid-19 pandemic along with geopolitical tensions has caused global economic and financial challenges as well as affected economic recovery and development.

In Vietnam, aiming to accelerate the economic recovery process and stabilize the macro-economy and people's lives, the Government has issued many resolutions to support socio-economic recovery and development such as Resolution No. /NQ-CP on the main tasks and solutions for the implementation of the socio-economic development plan and the state budget estimate in 2022; Resolution No. 11/NQ-CP dated January 30, 2022 on the socio-economic recovery and development program and the implementation of Resolution No. 43/2022/QH15 on fiscal and monetary policies to support the program with the common goal of improving competitiveness, resilience and quick recovery from the current crisis, minimizing negative impacts of the pandemic, and preventing negative impacts from the economy world economy, dealing with energy crises, supply chain disruptions, and geopolitical tensions

The above goals have increased pressure on the financial system in general and the financial market in particular in supporting economic recovery.

According to Assoc. Prof. Dr. Nguyen Nhu Quynh, the components of the stock market including the stock market, bond market, derivatives market, etc., is a solid basis for the financial market from now to 2025 and towards 2030

The capital market size grew at an average rate of 28.5% in the 2016-2021 period; and by the end of the first quarter of 2022, it accounted for 134.5% of GDP. In particular, the stock market accounted for 93% of GDP, government bonds accounted for 22.7% of GDP.

Currently, the stock market has 757 listed fund stocks, 858 businesses registered to trade on UpCom and more than 5. 2 million investor accounts. From April 2022, the market has adjusted, but the scale in the first five months of the year still reached VND11,747 billion/session; transactions increased by 8.1% compared to the average of 2021. This is a very impressive figure for the capital market.

"The financial market still has many shortcomings and limitations such as underdevelopment, affected by psychology and the influence of the world currency market. In addition, the mobilization of capital from corporate bonds still has many problems, especially in real estate businesses, leading to risks for investors and issuers. So, it is necessary to have solutions to develop the financial market, capital market and stock market on the basis of reviewing the Law on Securities and the Law on Enterprises to deploy management solutions," Mr. Nguyen Nhu Quynh said.

Need to closely coordinate fiscal and monetary policy

Speaking at the seminar, Mrs. Le Thuy Dung, Faculty of Finance and Banking (University of Commerce), said that fiscal and monetary policy played an important role in supporting liquidity for individuals and businesses as well as maintaining the existence of businesses in the short term

For example, in China, monetary policies focused on creating liquidity in the market such as performing open market operations, reducing lending rates and rediscount rates; reducing interest rates on excess reserves; increasing the credit limit of private enterprises; implementing a 0% interest program for loans of local banks, and loosening lending conditions of banks.

In parallel, in terms of fiscal policy, China deployed a budget spending package worth 4.9 trillion yuan to support economic development; 400 billion yuan for an extra-budgetary expenditure package to guarantee loans for small and medium enterprises.

“The application of fiscal and monetary policy in the context of the Covid-19 pandemic depends on resources, capacity to use existing policy tools and the nature of risks that each country faces. However, countries tend to use a combination of fiscal policy tools from the beginning with monetary policy tools, in which, fiscal policy mainly uses expenditure measures directly from the budget for individuals who are affected by tax reduction," Mrs. Le Thuy Dung said.

According to the National Institute for Finance, in order to continue to develop healthy and efficient financial markets, it needs to have close coordination between fiscal policy and monetary policy, along with the interoperability between the capital market and credit market to ensure market stability, macroeconomic stability and major balances of the economy.

On the other hand, conducting an overall review of the provisions of the Law on Securities, including the scope of public issuance, private placement, and the concept of securities investors.

By Thùy Linh/Thanh Thuy

Related News

With the recovery momentum returning, businesses need to speed up credit

With the recovery momentum returning, businesses need to speed up credit

VCN - In recent instructions, the monetary policy regulator continues to urge banks to implement practical and effective solutions to strive for system-wide credit growth, which will be 5-6% by the end of the second quarter of 2024.
Textile and garment exports recovered positively

Textile and garment exports recovered positively

VCN - Vu Duc Giang, Chairman of Vietnam Textile & Apparel Association shared with Customs News about the production and export situation of Vietnam's textile and garment industry after many difficult periods.
Exports in the first quarter "supported" economic recovery

Exports in the first quarter "supported" economic recovery

VCN - Continue the recovery momentum at the end of 2023, exports in the first quarter positively contributed to the growth results of the whole economy in the early period of 2024.
Fiscal policy - A pivotal milestone in promoting economic recovery and growth

Fiscal policy - A pivotal milestone in promoting economic recovery and growth

VCN - On the occasion of welcoming the Year of the Dragon 2024, Minister of Finance Hồ Đức Phớc shared with Customs Magazine about the outstanding results of the Finance sector in 2023 as well as the major orientations of the sector for 2024.

Latest News

Continue to handle cross-ownership in banks

Continue to handle cross-ownership in banks

VCN - The situation of excess share ownership, cross-ownership between credit institutions (CIs), CIs and enterprises, although has decreased significantly compared to previous periods, is still complicated and requires continued inspection and control.
Striving for average CPI not to exceed 4%

Striving for average CPI not to exceed 4%

VCN - According to the report of the Ministry of Finance, there are still some factors that put pressure on price levels in the remaining months of 2024, so the Ministry has updated 2 scenarios of average inflation in 2024 increasing in the range of 3.7-3.92%.
Delegating the power to the government to waive, lower, or manage late tax penalties is suitable

Delegating the power to the government to waive, lower, or manage late tax penalties is suitable

VCN - Discussing in groups about the project "1 law amending 7 laws" in the financial sector according to the program of the 8th Session on October 29, 2024, National Assembly delegates proposed that the Government should be assigned to make specific regulations on decentralization, granting the right to exempt and reduce taxes, and handling penalties for late payment of taxes...
Removing difficulties in public investment disbursement

Removing difficulties in public investment disbursement

VCN - According to the report of the Investment Department (Ministry of Finance), the estimated disbursement from the beginning of the year to October 31, 2024 is VND 355,616.1 billion, reaching 47.43% of the 2024 plan, reaching 52.29% of the plan assigned by the Prime Minister.

More News

State-owned commercial banking sector performs optimistic growth, but more capital in need

State-owned commercial banking sector performs optimistic growth, but more capital in need

VCN - According to the report sent to the National Assembly before the 8th Session of the Government on investment, management and use of state capital in enterprises nationwide in 2023, the business performance of the state-owned commercial banking sector achieved positive growth.
Stipulate implementation of centralized bilateral payments of the State Treasury at banks

Stipulate implementation of centralized bilateral payments of the State Treasury at banks

VCN - The Ministry of Finance (MOF) gathers feedback on the draft Circular regulating the management and use of accounts of the State Treasury opened at the State Bank of Vietnam (SBV) and commercial banks.
Rush to finalize draft decree on public asset restructuring

Rush to finalize draft decree on public asset restructuring

VCN - According to the Ministry of Finance, the draft Decree regulating the rearrangement and handling of public assets is being urgently completed by the Ministry of Finance to submit to the Government for promulgation.
Inspection report on gold trading activities being complied: SBV

Inspection report on gold trading activities being complied: SBV

The State Bank of Vietnam (SBV) has announced that inspections on compliance with legal policies in gold trading activities of credit institutions and gold trading businesses have been completed and an inspection report is being compiled.
Budget revenue in 2024 is estimated to exceed the estimate by 10.1%

Budget revenue in 2024 is estimated to exceed the estimate by 10.1%

VCN -The Government estimates that state budget revenue in 2024 will exceed VND 172.3 trillion, up 10.1% over the estimate, of which tax and fee revenue will reach 13.1% of GDP.
Ensure timely and effective management and use of public asset

Ensure timely and effective management and use of public asset

VCN – In order to promptly and effectively implement public asset management and use, ensuring compliance with legal regulations, the Ministry of Finance has just issued an official dispatch requesting ministries, branches and localities to comply with regulations in the Government’s Decree No. 114/2024/ND-CP dated September 15, 2024.
Accelerating decentralization in public asset management

Accelerating decentralization in public asset management

VCN - Amending the Law on Management and Use of Public Assets aims to improve regulations on accelerating decentralization and improving efficiency in management and use of public assets, and promoting financial resources, ensuring that the unified application the Law on Management and Use of Public Assets and other legal documents.
Difficulty in finding banks eligible to receive compulsory transfers

Difficulty in finding banks eligible to receive compulsory transfers

VCN - Reporting to the National Assembly, the State Bank of Vietnam (SBV) said that one of the difficulties in restructuring the credit institution system is the long process of finding and negotiating banks eligible to receive compulsory transfers.
Businesses can choose a suitable electronic invoice model generated from the cash register

Businesses can choose a suitable electronic invoice model generated from the cash register

VCN - The Ministry of Finance said that individual business households can choose a suitable model to apply electronic invoice solutions from cash registers, depending on the number of invoices used in the year, in the month and the current status of software solutions and technical infrastructure.
Read More

Your care

Latest Most read
Continue to handle cross-ownership in banks

Continue to handle cross-ownership in banks

VCN - The situation of excess share ownership, cross-ownership between credit institutions (CIs), CIs and enterprises, although has decreased significantly compared to previous periods, is still complicated and requires continued inspection and control.
Striving for average CPI not to exceed 4%

Striving for average CPI not to exceed 4%

VCN - According to the report of the Ministry of Finance, there are still some factors that put pressure on price levels in the remaining months of 2024, so the Ministry has updated 2 scenarios of average inflation in 2024 increasing in the range of 3.7-3
Delegating the power to the government to waive, lower, or manage late tax penalties is suitable

Delegating the power to the government to waive, lower, or manage late tax penalties is suitable

National Assembly delegates proposed that the Government should be assigned to make specific regulations on decentralization, granting the right to exempt and reduce taxes, and handling penalties for late payment of taxes...
Removing difficulties in public investment disbursement

Removing difficulties in public investment disbursement

VCN - According to the report of the Investment Department (Ministry of Finance), the estimated disbursement from the beginning of the year to October 31, 2024 is VND 355,616.1 billion, reaching 47.43% of the 2024 plan, reaching 52.29% of the plan assigne
State-owned commercial banking sector performs optimistic growth, but more capital in need

State-owned commercial banking sector performs optimistic growth, but more capital in need

According to the report of the Government on investment, management and use of state capital in enterprises nationwide in 2023, the business performance of the state-owned commercial banking sector achieved positive growth.
Mobile Version