FTSE Russell confirms Vietnam's market status upgrade to secondary emerging from Sept 21

FTSE Russell on Tuesday confirmed the reclassification of Vietnam from frontier to secondary emerging market status, effective from September 21, 2026, as the country "meets all criteria" for the status.

"FTSE Russell confirms that Vietnam meets all criteria for secondary emerging market status under the FTSE Equity Country Classification Framework and will continue to monitor developments closely ahead of the September 2026 effective date," its release said.

The announcement followed the organization's March 2026 semi-annual country classification review for equities for countries monitored by its global equity indices.

The March interim assessment considered progress in enabling access to global brokers, which is essential to support index replication and meet the needs of the international investment community.

FTSE Russell stated that it recognizes the progress made by the Vietnamese market authorities in evolving market infrastructure, including the removal of the prefunding requirement for foreign Institutional investors through the implementation of a non-prefunding model and the establishment of a formal process for handling failed trades.

David Sol, global head of policy at FTSE Russell, said: “FTSE Russell welcomes the continued progress made by the Vietnamese market authorities in aligning with international standards. The March interim review confirms that the key enhancements required to support the planned reclassification in September 2026 remain on track.”

Vietnam could be upgraded to MSCI Emerging Markets status as early as 2028 if key market reforms are completed, including the rollout of a central counterparty (CCP) clearing system and wider foreign ownership limits, said Le Anh Tuan, CEO of Dragon Capital VietFund Management JSC (DCVFM).

Speaking at Dragon Capital’s recent Investor Day event in January, Tuan said Vietnam’s long-term outlook remains underpinned by three major pillars: a more decisive and consistent political system in pushing reforms; the VNeID digital identity platform, which he said could fundamentally reshape how the economy operates; and the country’s ambition to become a regional powerhouse by 2030.

While short-term market volatility is inevitable, Tuan said the broader outlook for Vietnam’s economy and stock market over the next three to five years remains highly positive, urging investors to focus on long-term structural changes to capture emerging opportunities.