2025 prospects for investment channels in Vietnam

Vietnam's economy in 2025 is expected to continue recording positive growth, but confront with major challenges from the global economy. In that context, investors should diversify their portfolio, have moderate financial leverage, and invest more via professional organizations, writes Dr. Can Van Luc, chief economist at BIDV, a top 4 bank in the country.

The Vietnamese economy posted positive growth of 7.09% in 2024 thanks to net export, rising investment, and recovery in consumption.

Moreover, lending interest rates remained low, credit growth improved (up 15.08%), state budget revenue increased significantly thanks to the recovery of exports, production and domestic consumption; and inflation rose within control (3.63%).

In 2025, the world situation is unpredictable, but the Vietnamese economy is expected to grow even higher as the Party and the State are determined to make institutional breakthroughs including streamlining the apparatus, while many important laws and policies will take effect.

Vietnam's GDP growth in 2025 is likely to reach 7.5-8%, while inflation might be about 4-4.5%. Investment channels will basically hold a more positive outlook.

Real estate recovered, gold became a "fever" in 2024

By the end of 2024, deposit rates had risen by 0.71 percentage points, while lending rates had decreased by 0.59 percentage points compared to the beginning of the year, according to the State Bank of Vietnam (SBV).

The moderate hike in deposit rates explained why the growth of capital mobilization during the year was quite low, as cash flowed to channels with more attractive yields.

The stock investment channel had a relatively successful year. The VN-Index, which represents the Ho Chi Minh Stock Exchange (HoSE), went up 12.1% against the end of 2023. The total transaction value reached nearly VND4,600 trillion ($183.4 billion) in 2024, an average of VND18,685 billion ($745 million) per day, an increase of 22.4% compared to 2023.

Nearly 9.3 million securities trading accounts had been opened in Vietnam as of end-2024, of which 9.2 million belonged to Vietnamese individuals. Two million accounts were opened in 2024, which meant an average of over 166,000 opened each month, according to the Vietnam Securities Depository and Clearing Corporation (VSDC).

This was the second highest yearly figure in the market history, only behind 2022 when VN-Index saw a strong uptrend, with a peak of more than 1,528 points.

For corporate bonds, the market showed a positive recovery in 2024. By the end of November 2024, the total scale of corporate bond issuance reached about VND373 trillion ($14.87 billion), an increase of 40.5% compared to the same period in 2023.

The trend of buying back corporate bonds gradually decreased, with more than VND164.6 trillion of corporate bonds redeemed before maturity in the first 10 months of 2024, down 17% year-on-year. The average interest rate of corporate bonds issued in 2024 was 9.6%/year.

The real estate market also showed a positive recovery after a difficult period thanks to the strong economic recovery, the government's supportive policies, and a more complete legal framework.

According to a report from the Ministry of Construction, by the end of September, the market recorded 141,000 successful transactions, up 17% year-on-year. Housing prices continued to be "anchored" at a high level across the primary and secondary markets, especially in the apartment segment.

In particular, 2024 was the year when gold became an investment channel of special interest, especially in Q2, when the SJC gold price reached its peak (VND91.3 million, or $3,640 at the current exchange rate, per tael).

Gold prices increased sharply due to many factors, such as the trend of lowering interest rates and loosening monetary policy of central banks around the world, geopolitical tensions increasing gold holdings, especially at central banks, on anticipation that the price would further increase.

The SBV's solutions to stabilize gold prices helped cool down the gold market in Q2 and Q3, but the upward trend had returned since early November. By December 20, the SJC gold price was VND83.8 million per tael, an increase of about 13% compared to the beginning of the year.

Considering risk appetite before investing

In 2025, despite domestic and external risks such as geopolitical tensions, policies of new U.S. President Donald Trump, and erratic climate, Vietnam's GDP growth will still be positive, about 7.5-8%, while inflation might still be controlled within the target (4-4.5%).

In that context, investors should consider increasing the proportion of stocks and real estate in their investment portfolio to optimize profits. Bank deposits will still be a safe investment channel.

However, in the context of deposit rates leveling off or only slightly rising, depending on risk appetites, investors can consider reducing the proportion of bank deposits to switch to more profitable channels.

The Vietnamese stock market is receiving attention from many domestic and foreign investors as the prospect of market status upgrading is quite clear after many efforts of the government.

If upgraded to an emerging market in 2025, the most obvious impact is that Vietnam's stock market will attract larger, more stable and more diverse capital flows from foreign investors.

According to estimates by BIDV Securities Company (BSC), there will be about an extra $1.5 billion from foreign investment funds flowing into the market. The stock market is therefore forecast to have positive growth (possibly more than 2024) and is an investment channel worth considering.

The bond market is forecast to continue recovering well. However, with the new regulations in the amended Securities Law (included in the Law amending 9 laws passed by the National Assembly recenty), the ability of individual investors to buy corporate bonds will be more limited.

To buy private placement corporate bonds (which accounts for 90% of the total issuance), individual investors must be professional investors, private placement corporate bonds must have a credit rating, and they must have assets as collaterals or payment guarantees from a credit institution.

It is also important to note that these are necessary regulations to protect investors, because this market is still risky and not suitable for the majority of individual, unprofessional investors.

At present, this investment channel is more suitable for investors with knowledge of the financial market and ability to analyze corporate financial health, or those who entrust investments through institutional investors.

Individual investors without in-depth knowledge or little investment experience should consider investing through institutional investors like investment funds. Most funds in 2024 recorded positive results, and the good prospects of the stock market in 2025 are the basis for this trend to continue.

The real estate market will likely continue to recover more positively in 2025 thanks to many supporting factors: relatively positive economic prospects as mentioned above; the Party and State being determined to make breakthroughs in institutions and streamlining the apparatus; many important laws and policies related to land, real estate, and construction (Land Law 2024, Housing Law 2023, Real Estate Business Law 2023, resolutions to remove legal entanglements, and resolutions on specific mechanisms for some provinces and cities.) taking effect.

However, experts also noted that current real estate prices are quite high and need to be adjusted down appropriately in 2025. All in all, the potential yield of this market may be better or equivalent to 2024.

Many risks and uncertainties in the global economy will affect the price of gold in the world and in Vietnam. However, the Government and the SBV will have solutions to continue controling and stabilizing the gold market more effectively. Therefore, gold will still be a good haven, but yields will likely not be quite as high as in 2024.

In brief, bank deposits and gold are still considered safe. Real estate and stocks continue to be attractive investment channels, but with a higher level of risk and longer-term investment requirements.

Investors should make decisions based on their risk appetite, financial capacity and level of knowledge and experience, on the principle of "diversification, moderate financial leverage, and investing through more professional organizations".