Hanoi (VNA) - Vietnam is set to gain substantial benefits in the coming decade following strong reforms in its capital market system, according to a HSBC expert, who said the country’s long-awaited stock market upgrade marks a major milestone in its global standing and attracting large-scale investment inflows.
Gary Harron, Head of Securities Services at HSBC Vietnam, made the remark following FTSE Russell’s announcement to upgrade Vietnam’s stock market to Secondary Emerging Market status, effective from September 21, 2026, after a mid-term review in March that same year.
He stressed that Vietnam’s economy has continued to demonstrate robust momentum despite global headwinds, reinforcing its reputation as one of the most dynamic frontier and emerging markets. The country’s GDP expanded by 8.23% in the third quarter, its strongest pace since 2011, excluding the pandemic rebound of 2022.
While the stock market upgrade is conditional, it represents an important achievement that recognises the tireless efforts of the Government, regulators, and market participants,” Harron said, adding Vietnam now stands just two levels below developed market status.
Over the past six months, strong cooperation among regulators, foreign investors, and market stakeholders has helped remove the final barriers to progress. The next goal, he said, is to secure MSCI Emerging Market classification by 2030, which is expected to help the country attract larger global capital flows.
According to Harron, the upgrade is not merely symbolic but impacts how analysts and media perceive the market, as well as influences asset allocation decisions by global investors. Particularly, removing the frontier market label will bring recognition and assurance to Vietnam, reducing dependence on traditional trading partners.
Harron said Vietnam's capital market has made remarkable strides in both quality and scale. Market capitalisation and the number of trading accounts have increased sevenfold over the past decade. This year alone, the VN-Index has surpassed its COVID-era peak, reflecting high optimism about Vietnam's role in global supply chains.
This upgrade announcement will provide crucial momentum for market reform. Global investors, with confidence in Vietnam's future, will continue demanding the market meet even higher international standards. Vietnam's stock market has come a long way and can progress further with participation from long-term institutional investors, such as pension funds, which play vital roles in developed markets. This will contribute to enhanced stability and increased capital access for enterprises.
The Ministry of Finance has also announced plans to develop the securities investment fund industry, aiming to increase institutional investor participation through improved policies and legal frameworks, as well as training initiatives and public education programmes.
Although Vietnam's stock market has shown significant improvements, substantial work remains to become a critical capital mobilisation source like other regional markets. Over the past year, numerous reforms have been implemented to address major difficulties and facilitate the market upgrade. The State Securities Commission has removed margin requirements, simplified market entry regulations, upgraded transaction infrastructure, and ordered English-language disclosure for listed companies.
Upcoming reforms should include streamlining account opening process and developing central counterparty payment mechanisms to enhance accessibility for global securities brokers.
According to Harron, while FTSE Russell’s upgrade marks a turning point, it is not the final destination. Vietnam, he said, is carrying out plans to expand its pool of listed companies, strengthen domestic institutions, and maintain reform momentum toward further market upgrade.
Despite some tariff-related disruptions in the region, Vietnam has demonstrated a strong determination toward reformation. With policy support and global investor engagement, the country will witness significant progress in the next 25 years, he added./.
