Vietnam has praised the Government of Luxembourg's cooperation and support, especially in the finance sector.

Deputy Minister of Finance Truong Chi Trung revealed this at the Vietnam-Luxembourg Finance Forum in Hanoi on June 18. The forum was to mark the 40th anniversary of the establishment of diplomatic relations between the two countries.

Trung said the financial market in Vietnam is in an early stage of development and its potential is huge.

" Vietnam aims to develop the financial market in an efficient, open, transparent manner, moving towards international standards to create important funds and channels for the economy as well as develop regulatory tools to enable the market's stable development, to protect investors and internet services for users," he said.

Trung said Vietnam has received invaluable support from Luxemburg in forms of experience sharing, capacity building and system equipment.

In recent years, Luxembourg has witnessed the highest growth rates in the European Union. The service sector and banking and financial services are the main drivers of that growth.

Trung said the two countries have signed a protocol on a project to develop capital markets in Vietnam with a grant of 3 million EUR.

In addition, in the Vietnam-Luxembourg 2010-15 ICP, Luxembourg has offered to finance the projects in prioritised areas of development in Vietnam.

Sameer Goyal, coordinator of the World Bank's Financial and Private Sector, said Vietnam faces challenges in financial sector restructuring because legal, regulatory and supervisory framework continues to be behind international standards and practices.

He said banking sector assets have nearly doubled the Gross Domestic Product (GDP) and required large resources while the Government did not have fiscal space.

He said the Government should maintain consumer confidence and undisrupted services, adding that improving corporate governance is a must as bad management led to weak institutions.

Nguyen Thi Lien Hoa, vice chairman of the State Securities Commission (SSC) spoke about the achievements of the two countries in developing Vietnam 's securities market.

Hoa said Luxembourgh has helped the SSC in drafting professional manuals, finalising a legal framework governing operations in the market and supporting the legislation process to create a legal framework for new products.

Luxembourg Ambassador to Vietnam Marc Thill said his government is ready to give further support for Vietnam through vocational training and technical assistance.

"We are pleased to see steady progress in our economic relations with Vietnam and we are happy to continue to promote Luxembourg 's experience and know-how in the financial sector," he said.

Luxembourg is one of the leading financial centres in the world. It is host to 141 banks and 243 institutions active in the sectors of insurance and re-insurance.

The country holds an impressive six percent market share in international private banking.

Within the international fund industry, it is ranked second behind the US while it has become a leader in the cross-border distribution of investment funds.-VNA