Vietnam Stock Market Upgraded by FTSE Russell, Boosting International Capital Inflow Hopes

The upgrade of Vietnam’s stock market by FTSE Russell from Frontier to Secondary Emerging Market is expected to open up new opportunities to attract capital and greater participation from international investors, according to the State Securities Commission (SSC). SSC Vice Chairman Bui Hoang Hai noted that the next steps following the upgrade are clearly outlined in the securities market upgrade scheme, which took effect in September 2025. FTSE Russell views Vietnam as a remarkable growth story in Asia and a long-term partner, expressing a desire to deepen cooperation with the Vietnamese government and market participants. These assessments, however, must be viewed in the context of Vietnam's development trajectory since the Doi Moi economic reforms began in 1986. Emerging from prolonged wars, severe socio-economic difficulties, and economic embargoes, the country has undergone profound changes over the past four decades. Economists suggest that tax policy should be leveraged to channel investment towards technology, research and development, supporting industries, and enhancing supply capacity. This is crucial for Vietnam to further solidify its position in global supply chains. The market upgrade is anticipated to enhance Vietnam's international credibility and attract more foreign direct investment (FDI). Investments in infrastructure, renewable energy, and technology-intensive industries are likely to accelerate, as Vietnam offers a more integrated production ecosystem and favorable conditions for high-value projects. In the energy sector, for LNG-fired power to fulfill its role in Vietnam’s energy transition, bottlenecks in institutions, infrastructure, electricity pricing, Power Purchase Agreements (PPAs), power dispatch, and financing must be addressed. On Phu Quoc island, the DT975 corridor, connecting the international airport with the APEC Convention Centre, is being developed as a key component of the island’s future transport network. This route features 10 motor vehicle lanes and an integrated light rail transit (LRT) line. Under its one-party system, economic growth remains a top priority for Vietnam, with attracting foreign investment being a key strategy. This market upgrade signifies a move to strengthen ties with international capital markets. Amidst complex relations with China, Vietnam is pursuing a diversified diplomatic and economic strategy to maintain economic growth and enhance its international standing. Information Source: VietnamPlus English