Vietnam market upgrade story shifts towards MSCI

Progress in market reforms and trading infrastructure is strengthening Vietnam’s prospects of joining the MSCI’s watchlist, while supporting expectations for stronger foreign capital inflows in the coming years.

- By Khanh Linh

A May market report by SSI Research highlighted Vietnam’s strong prospects of being added to the MSCI’s watchlist during the June review, reflecting continued progress in market accessibility reforms. The report said that Vietnam currently meets 10 out of 18 MSCI accessibility criteria and is moving closer to compliance across most of the remaining requirements.

“Improvements include implementation of the non-prefunding mechanism, rolling out the central counterparty clearing framework, and stronger English-language disclosures from regulators and listed companies,” SSI Research stated.

Foreign ownership on the Ho Chi Minh Stock Exchange also rose from 41.4 to 46 per cent in April, largely driven by newly listed large-cap companies offering full foreign ownership room.

According to the firm, 17 out of 18 MSCI criteria are now approaching basic compliance standards, with foreign exchange liberalisation remaining the main unresolved issue. However, the report noted that the criterion should not be viewed as an absolute barrier, as several existing MSCI emerging markets have yet to fully satisfy the requirement.

Recent discussions on allowing commercial banks to provide foreign exchange hedging products were also viewed as a supportive signal for Vietnam’s watchlist prospects.

Separately, SSI Research added that Vietnam’s stock market showed strong resilience in April, with the VN-Index rising 10.7 per cent after falling 11 per cent in March, marking the strongest monthly gain since August 2025.