This video on the uses and habits of personal and corporate finance in Vietnam presents very insightful and sometimes obscure practices of Vietnamese companies and people. Tackling long-term economic and financial outlooks in Vietnam from different angles, several inside investors enlighten us with very sharp reflections and experiences.
Key insights on financial habits in Vietnam
- Listing on the stock exchange is a symbol of success for a Vietnamese company.
- Many Vietnamese are interested in the stock exchange performance.
- Many investors have approached the stock market to gamble and speculate irrationally. Rumors and stock market price manipulation or fixing seems to have taken place.
- The purpose of the Vietnamese is mainly to allow companies to obtain financing and state-owned enterprise to become equity-based.
- Several state-owned enterprises have however used the stock market to enter into the capital of smaller companies, increasing the weight of state-owned in the Vietnamese economy rather than reducing it.
- Many state-owned companies which were grown in Vietnam through government’s protection from abroad have used this government support to make money by speculating rather than building competitive industries. The result of such behavior has been a cycle of economic boom and busts in Vietnam.
- Yet some companies and entrepreneurs did manage to succeed, though not always through the financial markets.
- In 2010, one of the main problems in Vietnam was that it relied on the Vietnamese Dong, the US dollars and the use of gold as a reserve of value and currency.
- Vietnamese people often keep some of their money out of banks and relying on their circle of friends and families to access large funds.
- The outlook for Vietnam in the coming years and decades is very positive. The coupling of the Vietnamese natural inclination towards doing business, taking risks and starting companies with the opening of the economy will take Vietnam out of the lower income economies very soon.
Note: Though many reflections presented in this video could still be valid today, it has been posted in 2010 and should therefore be considered with precautions if you are involved in financial transactions in Vietnam.
Video posted in December 2010 on Youtube by Peter Pham