Upgrade to pave way for gradual inflows

Vietnam’s stock market is set to enter a new era, with phased index inclusion expected to support gradual passive capital inflows amid ongoing structural adjustments.

- By Kaitlyn Le

FTSE Russell’s confirmation last week that Vietnam has passed its interim review marks a key step in the country’s capital market integration. The country will be upgraded to secondary emerging market from September 21, with the transition to be implemented in four tranches rather than immediately.

Index inclusion will follow FTSE’s existing screening criteria, based on reference data as of December 2025. The official list of eligible constituents will be updated after FTSE completes its assessment under the revised framework. The FTSE semiannual review for September is scheduled for release on August 21, providing a reference point for tracking changes in index composition.

Wanming Du, head of Policy for Asia-Pacific at FTSE Russell, said the March interim review confirmed that Vietnam had met all criteria required to achieve secondary emerging market status under FTSE’s framework.

“Progress has been strong, with FTSE’s Index Governance Board confirming that implementation will proceed on schedule in September under a phased approach,” said Du at a webinar on FTSE Inclusion on April 13.

She also pointed to other markets that have followed similar pathways, including China A-shares in 2019, which were included at an initial 25 per cent weighting across three phases, and Saudi Arabia, which was implemented in four 25 per cent tranches.