Starting November 2, foreign investors will no longer be required to pre-fund 100% of their transactions, promising the removal of a major roadblock for Vietnam's market upgrade process.
The local stock market's upgrade from the frontier to emerging status by 2025 remains critical to the country’s transformation into a high-middle-income country by 2035 and a high-income country by 2045.
The Ministry of Finance is expected to ease pre-transaction deposit requirements for foreign investors this year.
If the stock market is upgraded to emerging status, the potential influx of foreign capital could range between $5 and $8 billion.
Proactive and coordinated efforts among Government agencies are key to achieving the goal of upgrading Vietnam's stock market from the current frontier to emerging market status.
With a P/E ratio of 11x, lower than most other markets in the world, the Vietnamese stock market is a very attractive choice for long-term investment.
The local stock market will not go smoothly in 2023 as risks still persist and hamper its prospects.
The central bank’s flexible management of monetary policy and the return of capital into markets around the world would have positive impacts on Vietnam’s market.
The ministry has been in frequent contact with both MSCI and FTSE Russell to update new information and their requirements to finalize the legal framework or address shortcomings in the market.
False rumors, concern over the capital flow, and high inflationary pressure have led to the recent market downtrend.
High market liquidity, information transparency, and expanding foreign ownership limits are expected to further attract foreign investors.
Vietnam has outperformed major regional indices, making the market nearly quadrupled in size compared with the start of 2012 and the trading exceeding $1 billion a day.
The stability of the VND-USD exchange rate helped Vietnam attract substantial attention from investors in the region, such as Thailand, Taiwan, and Singapore.
The prospects of the local stock market remain bright and will become a key capital mobilization channel for businesses and the economy, said the finance minister.
A healthy and transparent stock market would lay the foundation for sustainable development in the long term.
The authorities are committed to supporting compliant companies to ensure the sustainable development of the stock market.
Foreign investors have remained confident in Vietnam's stock market, with a net-bought volume of VND1.7 trillion (US$74 million) in the past five trading sessions.
