HCM CITY (VNS)— A voluntary pension fund will be set up soon, the Ministry of Planning and Investment has said.
The Government has ordered the Ministry of Finance (MoF), State Bank of Viet Nam, and other related agencies to take measures to develop the capital market, with priority given to establishing a Voluntary Retirement Pension Fund.
According to MoF, it has drawn up a blueprint for the fund and submitted to the Cabinet for consideration.
If it is approved, it would not only help improve the social security system but also the financial market and, especially, help increase the number as well as quality of giant investors, also known as elephants.
Several key principles to ensure the fund's effectiveness as well as safety have to be drawn up – like the contribution ratios by employers and employees, investment options and oversight of the fund, and benefits that contributors can enjoy.
Phan Thi Thu Hien, deputy director of MoF's Banking and Financial Institution Department, said the ministry is already working on a decree to guide the working of the pension fund so that the fund can be operated efficiently as soon as it is approved.
The decree will spell out regulations on investments and the benefits and obligations of participants.
According to the State Securities Commission, there are around 10 mutual funds in the stock markets.
More funds including some bond funds are set to be established, providing safe opportunities to invest in the pension fund corpus, it said.
Analysts said the early establishment of the pension fund would benefit the mutual funds sector, thus giving a boost to the capital market and securities market in terms of both depth and quality.
They called for tax breaks for the fund during its start-up period to ensure it has a smooth beginning.