Vietnam already meets FTSE's criteria for stock market status upgrade: Finance Minister

Vietnam has fulfilled the criteria for a stock market status upgrade by FTSE Russell through reforms aimed at facilitating foreign investment inflows into its market, said Minister of Finance Nguyen Van Thang.

At a meeting with representatives of the London Stock Exchange (LSE) in London on September 15, Thang added that the Vietnamese government has recently focused on implementing measures to lift the market status.

"So far, the country has met FTSE’s upgrade criteria through comprehensive reforms and decisive policies, such as issuing synchronized mechanisms and policies with immediate effect to facilitate foreign capital inflows into the Vietnamese stock market," he noted.

A plan to upgrade Vietnam's market status was approved by the government last weekend. Accordingly, the country aims to have its market status upgraded from "frontier" to "secondary emerging" by FTSE Russell in 2025.

To be upgraded, Vietnam must meet nine mandatory core criteria and two non-mandatory reference criteria. These must be reviewed by the market classification organization based on actual market experiences and positive feedback from foreign investors.

At the meeting, the minister proposed several directions for future cooperation between Vietnam and the LSE.

Specifically, Vietnam hopes to increase the exchange of experience in building and improving the legal framework, market supervision mechanisms, applying international corporate governance standards, information disclosure, and promoting Environmental, Social, Governance (ESG), thereby enhancing transparency, safety, and global integration, Thang said

Vietnam is also interested in learning from the development of new financial products such as green bonds, sustainable bonds, and derivative securities, he noted, proposing joint investment promotion programs and outreach activities to connect Vietnamese enterprises with international investors, particularly in the UK and Europe.

"Additionally, the country seeks to gain insights into market education and awareness, capacity building for financial and securities human resources, and the application of financial technologies such as Fintech, AI, and Blockchain to improve market efficiency," the minister added.

In response, Julia Hoggett, CEO of the LSE, expressed confidence in the future development of Vietnam’s stock market. She stated that the LSE would continue strengthening cooperation to support Vietnam in achieving an upgrade to "secondary emerging" market status.

She also expressed hope that the cooperation between the two sides would deepen, with the LSE becoming an effective "gateway" to connect Vietnam’s market with others globally.

She further discussed collaborative initiatives in the context of Vietnam’s active efforts to achieve a market status upgrade, including cooperation between FTSE Russell and the State Securities Commission of Vietnam (SSC) to address upgrade criteria, and the signing of an MoU to develop indices between the Vietnam Stock Exchange (VNX) and FTSE Russell.

As part of the working program, the Vietnam Stock Exchange (VNX) signed an MoU with FTSE International Limited (FTSE), officially establishing a strategic partnership between the two parties. The signing aims to enhance Vietnam’s capital market infrastructure and promote its international integration.

As of the end of August, the total market capitalization of Vietnam’s stock market had reached nearly $352 billion, equivalent to 79.5% of the 2024 GDP. Market liquidity has significantly improved, with some sessions reaching over $3 billion in trading value.

Since the beginning of the year, the average daily trading value has exceeded $1.1 billion, placing Vietnam among the most active markets in the ASEAN region.

FTSE Russell is a key company owned by the London Stock Exchange Group (LSEG). It provides index, data, and analytics services. FTSE Russell’s indices are widely used globally by asset managers, financial institutions, banks, and other investment organizations.

FTSE Russell provides indices for 94 of the top 100 global asset managers, who collectively manage nearly$16 trillion in assets. It currently evaluates 47 countries and their stock markets, covering 90% of global capital markets.