On September 13, 2019, on the framework of the TA Project of “Enhancing the Development and Soundness of the Banking Sector in Vietnam”, a Workshop on “International experience in financial stability and Implementations in Vietnam” was co-organized by the World Bank (WB) mission, the Swiss State Secretariat for Economic Affairs (SECO) and the State Bank of Vietnam (SBV).
Attending the Workshop were Mr. Bui Huy Tho, Deputy Director General of the Monetary and Financial Stabilization Department; Mr.Trieu Quoc Viet, WB senior expert; Mr. Jean Francois Bourchard, WB expert; Mr. Eugen Radulescu, Director of the Financial Stability Department of the National Bank of Romania; as well as other representatives from the SBV entities, the Ministry of Finance, the State Securities Commission, the General Statistics Office, the National Financial Supervisory Commission, the Ministry of Planning and Investment, the Central Economic Commission (CEC), etc.
Mr. Bui Huy Tho, Deputy Director General of the Monetary and Financial Stabilization Department, speaks at the Workshop
In his opening speech, Mr. Bui Huy Tho, Deputy Director General of the SBV Monetary and Financial Stabilization Department shared that a solid financial sector would promote economic growth, support the socio-economic development and technology innovation. On the contrary, the instability of the financial system can cause serious consequences or even restrain the economic development. The instability of a large financial institution may also pose risks to the entire financial system, and more broadly, to the whole economy. Up to now, all nations have recognized the important role of a central bank in financial stability.
Mr.Trieu Quoc Viet, WB senior expert
Introducing about the TA Project funded by the WB and SECO, Mr.Trieu Quoc Viet, WB senior expert, emphasized the role of financial stability. He said, “In the world, when a crisis happens, the insiders are caught in unexpected situations, and even though the leading experts may have analyzed, only a few accurate warnings may be given. Therefore, not only Vietnam, but other countries have either not done the right things yet or misunderstood the issues. Especially, after the global crisis of 2007 - 2008, many lessons have been drawn; all countries have realized that without a good warning system, the continuous waves of crisis would cause more serious consequences."
Mr. Eugen Radulescu, Director of the Financial Stability Department of the National Bank of Romania
Giving an overview of financial stability in the global context, Mr. Eugen Radulescu, Director of the Financial Stability Department of the National Bank of Romania, said that financial stability is a prerequisite for prosperity and economic growth, because a financial crisis can cause great damage to both the economy and the people’s social protection safety nets. The impacts of a financial crisis (lack of financial stability) are visible from different perspectives, one of which is shown in the fiscal costs. The fiscal costs created by a financial crisis can be direct (from direct interventions of the governments) and indirect (from the negative impacts on the macro-economic balances). He also shared the experience and the models that Romania has successfully applied in the recent years.
Le Hang