Vietnam tops government bond market

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Vietnam bondIn a continued show of its investor allure, Vietnam now has the region’s fastest growing local currency government bond market, a report covering Asia’s emerging markets published on June 4 by the Asian Development Bank revealed.

According the report, government bond growth was the most rapid in Vietnam, which posted a stunning 64.6 per cent year-on-year expansion to $29 billion, supported by the heavy issuance of treasury, central bank, and state-owned enterprise bonds.

Vietnam, especially in recent memory, has been the target of private equity investors looking to capitalise on the emerging market’s rapid growth. However, the poor structuring of the Vietnamese capital market makes it highly susceptible to so-called “hot money” – a potentially destabilising form of fluid capital movement.

Vietnam’s corporate bonds, in comparison, contracted 47.2 per cent to $1 billion over the same time period. This is a frightening discovery, as it signals that growth is not coming from the development of the capitalistic capillaries of the economy, but headed by intrigue in the government’s continued dominance of the country’s business world.

Meanwhile, Indonesia had the region’s fastest growing corporate bond market, according to the ADB report, expanding 26.9 per cent year-on-year to $20 billion. This pace was followed by China, which claims the region’s top corporate bond market at $1.1 trillion, up another 25.3 per cent year-on-year.

Foreign holdings of emerging Asia government local currency bonds continued to grow, with Indonesia posting lead growth levels of 32.6 per cent.

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Reading Time: 1 minute

In a continued show of its investor allure, Vietnam now has the region’s fastest growing local currency government bond market, a report covering Asia’s emerging markets published on June 4 by the Asian Development Bank revealed.

Reading Time: 1 minute

Vietnam bondIn a continued show of its investor allure, Vietnam now has the region’s fastest growing local currency government bond market, a report covering Asia’s emerging markets published on June 4 by the Asian Development Bank revealed.

According the report, government bond growth was the most rapid in Vietnam, which posted a stunning 64.6 per cent year-on-year expansion to $29 billion, supported by the heavy issuance of treasury, central bank, and state-owned enterprise bonds.

Vietnam, especially in recent memory, has been the target of private equity investors looking to capitalise on the emerging market’s rapid growth. However, the poor structuring of the Vietnamese capital market makes it highly susceptible to so-called “hot money” – a potentially destabilising form of fluid capital movement.

Vietnam’s corporate bonds, in comparison, contracted 47.2 per cent to $1 billion over the same time period. This is a frightening discovery, as it signals that growth is not coming from the development of the capitalistic capillaries of the economy, but headed by intrigue in the government’s continued dominance of the country’s business world.

Meanwhile, Indonesia had the region’s fastest growing corporate bond market, according to the ADB report, expanding 26.9 per cent year-on-year to $20 billion. This pace was followed by China, which claims the region’s top corporate bond market at $1.1 trillion, up another 25.3 per cent year-on-year.

Foreign holdings of emerging Asia government local currency bonds continued to grow, with Indonesia posting lead growth levels of 32.6 per cent.

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