Taiwan Stock Exchange to establish Vietnam office

The Taiwan Stock Exchange (TWSE) is planning to open an office in Vietnam as its first overseas foothold to attract investment from this Southeast Asian market.

The Vietnam office will aim at serving investors, including Taiwanese firms, from Vietnam and Thailand and getting them to invest in Taiwan, TWSE chairman Sherman Lin was quoted by Taiwan’s Central News Agency, the island’s largest information supplier.

Vietnam’s benchmark VN-Index surged 10.3% in January, driven by an easing of concerns about Vietnam’s credit crunch and corporate bond market, which were the main drivers that pushed the index down 33% last year, according to Michael Kokalari, chief economist at VinaCapital, a leading investment management firm in Vietnam with a diversified portfolio of nearly $4 billion in assets under management.

In a February 8 report, the economist said he expected Vietnam’s economy and stock market to “normalize” this year. The economy is returning to its long-term growth trajectory now that the post-Covid re-opening boom has finished, and recent market action suggests that the bear market which wiped 33% off the VN-Index last year, despite Vietnam’s fastest GDP growth in 25 years, is ending now, he wrote.

According to the TWSE, before opening the Vietnam office, it will begin working with foreign brokerages in the country to solicit funds for investment in Taiwan, the Central News Agency reported.

It quoted Lin as saying that the exchange had earlier sought to attract investment in Japan, Hong Kong, Singapore, the U.S., and Europe by working with financial institutions in those areas.

According to TWSE data, foreign institutional investors sold a net 1.29 trillion Taiwanese dollars ($42.86 billion) in shares on the island’s stock market in 2022 due to a sell-off in tech stocks amid aggressive rate hikes by the U.S. Federal Reserve. But foreign institutional investors still accounted for more than 40% percent of the market’s capitalization.

The TWSE said it would introduce new categories, including the digital, green energy, and sports or leisure sectors, sometime in June.