Of this, $350 billion is expected to come from the private sector, $248 billion from the state, and $103 billion from foreign sources.

Nguyen Tu Anh, director of the Center for Economic Information, Analysis and Forecast, said one of the great challenges is Vietnam’s heavy reliance on bank loans, which may pose risks if there are problems with the banking system’s health, such as a high bad debt ratio.

Analysts have pointed out that the credit per capita is much higher than GDP per capita in Vietnam, which shows loose connectivity between credit growth and GDP growth. Hence, there are doubts that the real amount of loans provided to the national economy is not as large as reported.

Meanwhile, the corporate bond market, considered an important channel for medium- and long-term capital mobilization, remains fledgling, with credit institutions and real estate firms being the major members.

The lack of diversified capital mobilization channels makes it difficult for many Vietnamese enterprises to access funds. Not only SMEs (small and medium enterprises), but large enterprises also find it difficult to obtain loans, which is why businesses cannot grow rapidly.

Smaller and even medium-sized enterprises struggle to access capital, hindering their growth and affecting broader economic development.

Anh said it is necessary to accelerate investment and improve investment quality by diversifying capital mobilization channels.

“A developed economy cannot rely heavily on banks. We need to develop other major capital channels, including the corporate bond and securities markets. Once the capital market develops and diversifies, the national economy will see more prosperity,” Anh said.

Real estate market and corporate bond market

Regarding new regulations about the corporate bond market mentioned in the draft of the amended Securities Law, Le Xuan Nghia, a member of the National Advisory Council for Financial and Monetary Policies, said regulations have helped the bond market warm up again, but there are still challenges.

“The corporate bond market clearly reflects the structure of Vietnam’s economy. GDP growth rate is high, but this relies on exports which are generated mostly by foreign invested enterprises (FIEs). Meanwhile, domestic enterprises make up a small proportion of exports, and export products are mostly forestry, agricultural and seafood,” Nghia said.

The economist said that if Vietnam doesn’t carry out strong reform in the bond market in both technology and quantity, it will be difficult to foster growth of domestic enterprises. And if so, the national economy will have to continue to rely on FIEs.

Nghia noted that the major members of the bond market are real estate firms and commercial banks. However, banks mobilize capital via the market mostly to serve plans to mobilize tier-2 capital (bank's supplementary capital, which is held in reserve), to increase the amount of capital they can get from the public and capital they can lend.

Meanwhile, real estate firms are bogged down in difficulties, impacting the corporate bond market. Other domestic enterprises are seriously lacking capital, but they cannot seek capital in the bond market because capital there is short-term, while interest rates are high.

"If the corporate bond market continues to depend solely on real estate, the coming year will still be tough. In order to solve the current problems in the corporate bond market today, the first thing that needs to be done is accelerate pending real estate projects in many cities and provinces,” he said. 

The National Assembly's Economics Committee, in its report about the implementation of the National Assembly’s Resolution on socio-economic development in 2024 released in October 2024, noted that liquidity in the bond market has improved significantly, but still faces difficulties.

The Vietnamese corporate bond market experienced a strong growth rate of about 45 percent in 2018-2021, but declined significantly after 2022 due to changes in the business environment, legal framework, and several incidents related to violations of issuance regulations.

Nguyen Khac Hai from SSI Securities believes that changes in the amended Securities Law concerning the corporate bond market will help the bond market develop well.

"The stricter conditions for corporate bonds in the revised Securities Law will ease investors’ concerns. These changes will pave the way for investors to return, stimulating the vibrancy of this capital mobilization channel," Hai explained.

The SSI's representative also stressed the need to attract more foreign investors to diversify the customer base in the corporate bond market.

Tuan Nguyen