Upgrading Vietnam stock market to emerging market status remains top gov’t priority

The upgrading of the Vietnamese stock market from a frontier to an emerging market status is a top priority for the government, said Vu Thi Chan Phuong, chairwoman of the State Securities Commission (SSC).

Phuong made the statement at the Vietnam Financial Investment conference, hosted by the SSC and Vietnam’s Ministry of Finance in Singapore on Tuesday. The event focused on the current status on the Vietnamese stock market, its potential, and preparations of local securities firms for the potential upgrade.

The finance ministry and the SSC have been working collaboratively with relevant parties to expedite the progress. The ministry is currently seeking public feedback on draft amendments to four circulars covering transactions, registration, depository and clearing; operation; and information disclosure, Phuong added.

Experts have initially assessed the draft amendments as highly feasible, she noted.

Minister of Finance Ho Duc Phoc emphasized that Vietnamese authorities are committed to enhancing the market’s transparency, safety, and security while ensuring investors’ rights and legitimate benefits, with the goal of achieving an upgrade “soon.”

Vietnam welcomes Singaporean and regional businesses and investors to join or expand their activities in Vietnam, Phoc said.

A day earlier, the Vietnam Exchange (VNX), under the finance ministry, and the Singapore Exchange (SGX) signed a memorandum of understanding. The agreement outlines cooperation in information exchange, sharing experiences related to market surveillance and derivatives markets, cross-listing activities, regulations for listed firms, and rule compliance.

The two exchanges will also explore opportunities in product development, stock market listings, and derivatives market listings.

As of July, after 24 years of operation, the Vietnamese stock market had over 1,600 tickers, with a market capitalization of $278 billion, equivalent to 65% of the country’s 2023 GDP. The number of investors exceeded eight million, representing over 10% of the adult population.

In June, MSCI Inc., a leading provider of critical decision support tools and services for the global investment community, determined that the Vietnamese stock market was still classified as a frontier market and had not yet achieved the emerging market status.