For nearly seven years, Viet Nam waited. Since being placed on the FTSE Russell watchlist in 2018, the country had been steadily reforming its market until, in early April 2026, the long-awaited confirmation finally arrived.
FTSE Russell is a global stock market index provider owned by the London Stock Exchange Group, serving as a benchmark for trillions of dollars in institutional investment funds worldwide. When a country is classified as an emerging market, funds that track its indices are effectively required to allocate attention—and often capital—to that market.
On April 7, 2026, FTSE Russell officially confirmed its decision: Viet Nam had been upgraded. The emerging market status will take effect on September 21, 2026, when Vietnamese equities begin to be gradually included in FTSE global index series through 2027.
This reclassification places Viet Nam alongside China, India, Indonesia, the Philippines, and Qatar in the Secondary Emerging Market category, marking a clear signal that Viet Nam’s capital market is no longer just a peripheral growth story outside the core focus of global investors.
Reforms That Opened the Door
In November 2024, Viet Nam removed the full pre-funding requirement for foreign investors in equity settlement, a rule that previously required investors to transfer the full amount of funds into domestic accounts before executing trades.
This was followed in 2025 by Decree 245/2025, issued in September, which eliminated provisions allowing public companies to unilaterally set foreign ownership limits below legal thresholds. This structurally expanded room for foreign participation in Viet Nam’s stock market.
During the same period, the Ministry of Finance issued Decision 2014/2025 outlining three major reform pillars: regulated short selling, securities borrowing and lending (SBL), and same-day trading (T+0), scheduled to be rolled out between 2026 and 2028.
Entering 2026, the Law on Investment 2025, effective March 1, 2026, allows foreign investors to establish business entities before applying for an Investment Registration Certificate, significantly reducing bureaucratic steps that had previously slowed capital inflows.
In December 2025, Viet Nam’s National Assembly also passed amendments to the Investment Law, removing 38 conditional business lines and revising 20 others, reducing the total from 234 to 196 conditional sectors, with the changes taking effect on July 1, 2026.
How Much Capital Inflow Is Expected?
In an October 2025 research note, VinaCapital estimated that this upgrade could bring approximately USD 5–6 billion in foreign capital into Viet Nam’s market. The World Bank projects that if Viet Nam also succeeds in joining MSCI indices, total net foreign inflows could reach as high as USD 25 billion by 2030.
In the list released by FTSE Russell as of December 31, 2025, there are 32 Vietnamese stocks that meet the criteria for inclusion in the FTSE Global All Cap Index, with Viet Nam’s weight estimated at around 0.35% in the FTSE Emerging All Cap basket and 0.227% in the FTSE Emerging Index.
Stocks from the banking sector such as BIDV, technology firms such as FPT, and energy companies such as Binh Son Refining are included in the list.
What Still Needs Attention
However, this capital inflow will not arrive all at once. Analysts expect passive inflows to be phased in over 12 to 18 months after the effective date of September 21, 2026.
One remaining concern among large institutional investors is global broker access. Although not a mandatory requirement for maintaining Secondary Emerging Market status, FTSE Russell continues to flag it as an important issue for index users and expects it to be monitored going forward.
In an October 2025 report, Maybank Securities described the FTSE upgrade as part of Viet Nam’s broader strategy to deepen its capital markets. The report also noted that achieving an investment-grade sovereign credit rating—which could happen as early as 2028—may have an even greater impact than the index upgrade itself.
