Vietnam to open finance leasing market to foreign investment

Vietnam will open its finance leasing market to foreign investors by 2010, local newspaper Vietnam News reported Tuesday.

Under a roadmap being built by the State Bank of Vietnam (SBV), the country will diversify leasing operations and loosen the bank's management, said deputy head of the SBV's Banking Department Tran Xuan Chau.

All foreign investors would be encouraged to enter into the market, in contrast to the current regulations which limit investment to foreign commercial banks and finance leasing companies, he said.

The Asian Development Bank (ADB) is helping Vietnam improve its finance leasing market in line with international standards as the country becomes a member of the World Trade Organization.

ADB would support Vietnam in legislative reform and training activities, while helping finance leasing companies to access foreign loans at low interest rates.

Finance leasing business has been developing for just 10 years in Vietnam, accounting for a small share of the whole domestic financial market. As few as 11 firms participate in the finance leasing market, including three joint ventures and one wholly foreign-invested company, which conduct leasing operation mainly in the fields of machinery, facilities and transport.

The market's outstanding debt, which posted year-on-year rise of 13.52 percent in the first half of this year, is expected to increase 30-40 percent in the whole year, said the report.

Source: Xinhua