| Author | Nguyen Thi Tuong Vi |
| Call Number | AIT RSPR no. SM-99-59 |
| Subject(s) | Banks and banking--Vietnam
|
| Note | A research study submitted in partial fulfillment of the requirements for the degree of Master
of Business Administration, School of Management |
| Publisher | Asian Institute of Technology |
| Abstract | Vietnam is one of the developing and transition economies which started its reform in
banking industry in the last few years. Failures of the banking system and bad debt have
strongly affected the growth rate and contributing to the decline in industrial production
and foreign investment. If Vietnamese Government does not pay enough attention to the
development of banking and finance system then disaster is unavoidable, even though the
economy has achieved miracle results.
Due to its low development stage, Vietnamese infant banking and finance system in a more
challenging context of the world economy, the concern is much more emphasized. Vietnam
needs to quickly build up an effective system to mobilize, distribute and use capital. This is
the most important condition to record sustainable and fast economic growth without
deeply depending on the outside world. Improvement of the banking and finance sector in
Vietnam in order to keep the country in step with the economic restructuring and
development of its neighbors is an urgent need.
This report discusses the impacts of step-by-step reform as well as evaluating the
development of banking sector of Vietnam in recent years. Besides problems and prospects
inherent in the transition to a market-based economy, such as the development and the
efficiency of the banking sector in Vietnam will be analyzed. The resulting degree of
uncertainty makes it very difficult and not very useful to design a long-term strategy for the
financial sector. Therefore, this report focuses on the next three to five years only.
From Vietnam's reform practice during the period 1988-1998, the study found that (i)
Vietnamese banking system is facing lots of problems related to interest rate policy,
ambiguity about property rights, inefficient credit allocation system, bad debt and
macroeconomic issues; (ii) banking reform in Vietnam helped to bring down inflation and
resulted temporary macroeconomic stability; and (iii) Vietnamese government is pursuing
further reform in banking sector.
The policy implication of the study is that in order to strengthen Vietnam's banking
system, Vietnamese government should (i) modernize banking system; (ii) liberalize
interest rate; (iii) integrate into an economy-wide strategy to improve credit allocation
system (iv) improve legislation framework; and (v) accelerate equitisation of state owned
enterprises.
|
| Year | 1999 |
| Type | Research Study Project Report (RSPR) |
| School | School of Management (SOM) |
| Department | Other Field of Studies (No Department) |
| Academic Program/FoS | Master of Business Administration (MBA) (Publication code=SM) |
| Chairperson(s) | Tang, John C. S. |
| Examination Committee(s) | Do Ba Khang;Buchel, Bettina |
| Scholarship Donor(s) | The Government of New Zealand |
| Degree | Research Studies Project Report (M.B.A.) - Asian Institute of Technology, 1999 |