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IFC CEO Urges Vietnam to Accelerate Reforms of State-Owned Enterprises to Support Economic Growth

Hanoi, Vietnam, September 13, 2013 —IFC, a member of the World Bank Group, calls on Vietnam to speed up reforms in its banking system and state-owned enterprises to achieve sustained economic growth, said IFC Executive Vice President and Chief Executive Officer Jin-Yong Cai.
“In the current global environment, Vietnam’s banking sector and its state-owned enterprises must make better use of capital to help the country attain high levels of growth and realize its full potential,” Cai said during a visit to Vietnam this week.
IFC has been supporting Vietnamese financial institutions by providing financing and advisory services. In the first strategic investment by a foreign institution in a Vietnamese state-owned bank, IFC and its Capitalization Fund helped the partial privatization of the Vietnam Joint Stock Commercial Bank for Industry and Trade, or VietinBank, by investing $307 million in the lender in 2011.
“In the same way that we have supported VietinBank, IFC can invest and mobilize other international investors to help Vietnam’s state-owned enterprises with their partial privatization and support banks in implementing structural reforms,” Cai said.
IFC is working with VietinBank and other Vietnamese lenders to align their risk management and governance policies with international best practices in order to improve their ability to offer financial services to more small and medium enterprises.
During his visit, Cai met with senior government officials and private sector partners in Hanoi on Thursday and Friday to discuss opportunities to scale up IFC’s investment and advisory services in the country.
At a meeting with Deputy Prime Minister Hoang Trung Hai, Cai called on the Vietnamese government to accelerate the equitization, or the sale of partial stakes, of state-owned enterprises in order to improve the country’s competiveness. Cai also met with Minister of Planning and Investment Nguyen Quang Vinh, State Bank Deputy Governor Le Minh Hung, and Vietnam Asset Management Company Chief Executive Officer Nguyen Huu Thuy, among others.
IFC has invested around $805 million in Vietnam during fiscal year 2013, which ended on June 30, to help expand lending to small and medium enterprises, create jobs, and spur growth as the country’s economy slowed and companies found it challenging to obtain financing. Vietnam ranked second after China in terms of IFC’s investment volume in East Asia Pacific.
About IFC
IFC, a member of the World Bank Group, is the largest global development institution focused exclusively on the private sector. Working with private enterprises in more than 100 countries, we use our capital, expertise, and influence to help eliminate extreme poverty and promote shared prosperity. In FY13, our investments climbed to an all-time high of nearly $25 billion, leveraging the power of the private sector to create jobs and tackle the world’s most pressing development challenges. For more information, visit www.ifc.org .
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