Miko Huang
- Economic surge: Vietnam achieved 8.2% GDP growth and a 57.7% stock market rally in 2025 — outpacing ASEAN peers and attracting record FDI.
- Market upgrade: FTSE Russell to upgrade Vietnam from Frontier to Emerging Market status in September 2026, reflecting major reforms in accessibility and liquidity.
- Investment magnet: New infrastructure, tech expansion, and regulatory changes are drawing global investors and deepening regional market ties.
Vietnam is celebrating a landmark year in 2025. The country’s GDP growth surged by an impressive 8.2% in the third quarter, while its stock market has delivered a remarkable 57.7% price return (in Vietnamese dong terms) as of 30th September 2025. As the nation marks the 80th anniversary of its independence, it has recently passed another historic milestone: FTSE Russell announced Vietnam’s long-awaited upgrade from Frontier Market to Emerging Market status on 7th Oct 2025. Together, these achievements underscore a year of extraordinary progress and global recognition for Vietnam.
But Vietnam isn’t just riding a wave of growth—it’s also reshaping the whole Association of Southeast Asian Nations (ASEAN) region. With its strong economic momentum, surging exports and a recent flood of foreign investment, the country has made bold strides on both the regional and global investment stage.
Record-breaking GDP growth: Outpacing ASEAN and the world
Vietnam’s economic performance has been nothing short of impressive. According to government data, gross domestic product (GDP) surged by 8.2% in Q3, outpacing all the country’s ASEAN peers and reinforcing Vietnam’s position as a regional economic powerhouse. The country is targeting full-year GDP growth of 8.3% to 8.5%, a notable acceleration from 7.1% in 2024. This target also exceeds the latest forecasts from global institutions (the World Bank predicts 6.6% growth and the IMF 6.5%).
IMF growth forecasts
| Real GDP growth (Annual percent change) | 2023 | 2024 | 2025 Projection |
|---|---|---|---|
| Indonesia | 5 | 5 | 4.8 |
| Malaysia | 3.6 | 5.1 | 4.5 |
| Philippines | 5.5 | 5.7 | 5.5 |
| Singapore | 1.8 | 4.4 | 2 |
| Thailand | 2 | 2.5 | 2 |
| Vietnam | 5.1 | 7.1 | 6.5 |
| ASEAN-5 | 4.1 | 4.6 | 4.1 |
| Asia and Pacific | 5.1 | 4.5 | 3.9 |
| World | 3.5 | 3.3 | 2.8 |
Source: IMF, World Economic Outlook, July & September 2025 update Past performance is no guarantee of future returns. Please see the end for important legal disclosures.
The industrial, construction, and service sectors have been the primary engines of the Vietnamese economy’s growth. Over the first nine months of the year, the industrial sector expanded by 8.6%, while the service sector grew by 8.5%, reflecting robust domestic demand and continued investment in infrastructure and modernisation.
In July 2025, the U.S. and Vietnam signed a trade agreement under which the U.S. imposed a 20% tariff on Vietnamese goods—significantly lower than the previously threatened 46% levy in April. An additional 40% duty was applied to goods suspected of transshipment, particularly those originating from China. While the agreement helped avoid harsher penalties, Vietnam’s exports to the U.S. still declined by 2% in August and 1.5% in September. Nevertheless, total import-export turnover for the first nine months of the year reached $680.66 billion, marking a 17.3% year-on-year increase.
Vietnam's investment landscape: A tech hub in the making
Vietnam is positioning itself as the Silicon Valley of Southeast Asia—and it's meeting with apparent success: according to the National Statistics Office of Vietnam, in the first nine months of 2025, the country attracted a record-breaking $28.54 billion in foreign direct investment (FDI). Global technology giants like Samsung, Intel, Nvidia and Foxconn are sinking billions into the country, particularly in electronics, semiconductors and AI.
This influx is reshaping the economy, creating a highly sophisticated manufacturing base that will keep Vietnam at the cutting edge of innovation for years to come. Vietnam’s strategic location in global supply chains, competitive labour costs, and pro-business government policies make it an ideal destination for companies seeking to diversify beyond China.
FTSE Vietnam 30 index performance vs. ASEAN peers
| Cumulative Return—Price Return % (USD) | ||||||
|---|---|---|---|---|---|---|
| Country | Index | YTD | 1Y | 3Y | 5Y | 10Y |
| Vietnam | FTSE Vietnam 30 Index | 52.1 | 40.5 | 30 | 47.5 | 117.4 |
| Singapore | STI | 19.8 | 19.1 | 52.5 | 85.3 | 432.6 |
| Malaysia | FTSE Bursa Malaysia KLCI Index | 4.3 | -4.3 | 27.3 | 5.8 | 3.9 |
| Thailand | FTSE SET Large Cap Index | 1.5 | -7.6 | 7.1 | 16.9 | 12.6 |
| Indonesia | FTSE Indonesia Index | -9.9 | -24.5 | -25 | 4.1 | 22.4 |
| Philippines | FTSE Philippines Index | -4.3 | -18.2 | 14 | -5 | -22.1 |
| ASEAN+ | FTSE ASEAN Extended Index | 6.5 | -2.4 | 17.2 | 27.5 | 26.8 |
Source: FTSE Russell, as of 30th September 2025. Past performance is no guarantee of future returns. Please see the end for important legal disclosures.
The 2025 rally has been led by the real estate, industrials and energy industries, which are benefiting from Vietnam’s rapid urbanisation, infrastructure development and energy transition. The largest constituent in the index by weighting, Vingroup JSC, has been a key contributor to the index’s gains, reflecting investor confidence in Vietnam’s corporate champions.
Beyond the cash equities market, derivatives activity is also gaining momentum. In August 2025, the SGX FTSE Vietnam 30 Index Futures saw an average of 1,497 contracts traded daily, reflecting growing interest from both institutional and retail investors. Over the past three months, trading volumes have steadily increased, signalling rising confidence in Vietnam’s equity story and a broader appetite for risk-managed exposure to the market.
Improved market access and a change of country classification
Vietnam’s equity market isn’t just growing; it’s moving to a higher level within FTSE Russell’s equity country classification regime. Under this regime, we classify the equity markets in our global indices classifies them as Developed, Advanced Emerging, Secondary Emerging or Frontier.
The country classification process ensures that FTSE’s global benchmarks reflect the most relevant and accurate information about equity market structures, offering investors risk management insight into the regulatory and trading practices of the markets included in the global and regional indices they track.
This upgrade marks a pivotal moment in Vietnam’s capital market development and reflects years of strategic reform aimed at aligning with global standards.
To reach this point, Vietnam has undertaken a series of bold and meaningful reforms aimed at modernising its capital markets. Among the most significant changes is the elimination of an earlier requirement to pre-fund trades, a long-standing barrier that has previously deterred many foreign institutional investors.
In its place, Vietnam has introduced a non-prefunding (NPF) model, along with a formalised process for managing failed trades. These changes have improved market accessibility and liquidity, making Vietnam’s stock exchange more attractive to global capital.
Another major development is the launch of a new securities trading and post-trade system called “KRX”, which enhances trading efficiency, shortens settlement cycles and introduces new products such as intraday trading and covered warrants. This launch has also brought Vietnam’s equity market infrastructure closer to that of developed economies.
Vietnam’s developments in 2025 highlight its continued efforts toward economic and market reform. With its upcoming reclassification to emerging market status, the country may see increased interest from global investors, further expansion of its financial markets, and a growing role within the regional landscape.
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