National agencies will provide more information to international credit
rating bodies to ensure accurate representations of Vietnam’s economic
wellbeing, after Prime Minister Nguyen Tan Dung signed off on a new
decision 61/2013/QD-TTg.
Currently, no ministry or
organisation in Vietnam is authorised to provide economic data to
ratings bodies, meaning the information they collect is often inadequate
and sometimes inaccurate.
Accordingly, information
needed to calculate the national credit rating will be handed over,
based on recommendations from ratings organisations in accordance with
Vietnam’s legal regulations and ability to meet the requirements.
The mentioned information includes general socio-economic information,
fiscal data, monetary and banking data, external economic information,
plus political and other socio-economic information.
The decision states that socio-economic general information includes
mid-term and long-term strategies, as well as annual solutions for
socio-economic development.
Data on economic growth,
national income, per capita income, savings ratio, investment ratio,
inflation, population, jobs and unemployment will also be provided.
Ratings agencies will also be able to access fiscal information such
as policy and mid-term financial budget plans; State budget collection,
spending and balance data; SOE reforms; Government debts; provisionary
Government debt liabilities; public debt and external national debt.
Monetary and banking information on exchange rates, interest,
compulsory reserves and open market operation (OMO); performance of the
State Bank of Vietnam, credit institutions and restructuring of the
banking system; balance of payments, foreign currency reserves, credit,
non-performing loans (NPLs) and strategies to reduce them will also be
available.
External economic information covers
import-export figures, trade balance and overseas remittances. Political
information includes Government policies and directions; Government
personnel; Vietnam’s relationships with other govern-ment’s
international financial institutions; administration reform and
procedures control.
The PM also calls for stronger co-operation between relevant ministries and agencies to better implement the task.
Relevant agencies will have to report the aforementioned information
periodically to the Ministry of Finance, which will be in charge of
working with global ratings agencies to sign agreements on providing
relevant data and ensuring agencies publicise the country’s credit
ratings, while making recommendations on the issues at hand.
The finance ministry will also co-operate with Government Offices; the
ministries of Planning and Investment, Foreign Affairs and Industry and
Trade; the National Committee on Financial Supervision and the State
Bank of Vietnam, to meet and provide socio-economic information for
international investors, financial and export credit organisations, plus
ratings agencies to ease the country’s capital mobilisation in the
global market and raise the national credit rating.
In addition, the Ministry of Finance is expected to launch a State-run
credit rating agency (CRA) next year in a move to create a
government-run institution able to reliably rate the country’s stocks
and companies.
The purpose of the CRA will be to
judge how likely it is that a company is able to meet its financial
obligations. It is projected to be backed by 15 billion VND (714,000
USD) in capital and will rate both private and State-owned corporations,
as well as financial, banking, insurance and non-financial
institutions.-VNA