There will be less risk of inflation and high interest rates next year and the difference between official and open market foreign exchange rates will be narrowed, according to Le Xuan Nghia, Deputy Chairman of the National Committee for Financial Supervision.
The Government will give top priority to tackling infation and foreign exchange problems next year, he said on the sidelines of a Dec. 18 seminar on opportunities and risks in the stock market in 2011.
Once the inflation problem is solved, the interest rate issue will cool down and the stock market will grow in a more stable manner, Nghia said.
"An increased interest rate (on deposits) usually means a decrease in stock market investment. Higher gold prices and a stronger US dollar (in Vietnam) have also made investors more cautious, not to mention macroeconomic impacts," he said, explaining why Vietnam's stock market fell while others elsewhere grew.
He was confident that the world's economic recovery in 2011 will be stronger, that the "dark clouds" above Egypt, Ireland, Spain and Italy will lighten and the Asian economy will continue to develop rapidly, supporting Vietnam's economic growth.
Nghia also said Vietnam's stock market has positive factors to attract investors, including the average Price to Earnings (P/E) ratio of around seven and eight compared to the regional average of 17.
However, he agreed speculation plays a role in improving liquidity, drawing medium and long-term investors.
"Foreign investors have an important role in Vietnam's stock market and they are good at economic analysis, thus they will see that medium and long term investment in this country will be more attractive than in other regional markets," he noted.
Over the last three months, foreign indirect investment increases by about 10 percent each month, Nghia said./.
The Government will give top priority to tackling infation and foreign exchange problems next year, he said on the sidelines of a Dec. 18 seminar on opportunities and risks in the stock market in 2011.
Once the inflation problem is solved, the interest rate issue will cool down and the stock market will grow in a more stable manner, Nghia said.
"An increased interest rate (on deposits) usually means a decrease in stock market investment. Higher gold prices and a stronger US dollar (in Vietnam) have also made investors more cautious, not to mention macroeconomic impacts," he said, explaining why Vietnam's stock market fell while others elsewhere grew.
He was confident that the world's economic recovery in 2011 will be stronger, that the "dark clouds" above Egypt, Ireland, Spain and Italy will lighten and the Asian economy will continue to develop rapidly, supporting Vietnam's economic growth.
Nghia also said Vietnam's stock market has positive factors to attract investors, including the average Price to Earnings (P/E) ratio of around seven and eight compared to the regional average of 17.
However, he agreed speculation plays a role in improving liquidity, drawing medium and long-term investors.
"Foreign investors have an important role in Vietnam's stock market and they are good at economic analysis, thus they will see that medium and long term investment in this country will be more attractive than in other regional markets," he noted.
Over the last three months, foreign indirect investment increases by about 10 percent each month, Nghia said./.
