HCMC – Vietnam’s stock market has officially been upgraded from Frontier Market to Secondary Emerging Market status by global index provider FTSE Russell, the organization announced early on October 8.
The reclassification decision, released in FTSE Russell’s latest country classification review, confirms that Vietnam has met all the requirements of a secondary emerging market. The upgrade will take effect on September 21, 2026, pending the outcome of a follow-up assessment in March 2026, which will review Vietnam’s progress in improving foreign investor access.
“FTSE Russell acknowledges that Vietnam has met all the criteria of the Secondary Emerging market status under the FTSE Equity Country Classification Framework. FTSE Russell will continue to monitor developments closely and welcomes feedback from index stakeholders to enable the reclassification to proceed as planned in September 2026,” the report stated.
The board also reviewed feedback from its advisory committee regarding foreign ownership limits in Vietnam. While this is not a mandatory criterion, FTSE Russell said further improvement in market accessibility for foreign investors remains essential.
Vietnam had been listed on FTSE Russell’s Watch List for potential upgrade since September 2018, when it was classified as a frontier market. At that time, the country failed to meet two criteria—Delivery versus Payment (DvP) and Transaction Failure Handling—both rated as “Restricted.”
By November 2024, Vietnam’s market regulator introduced a non-prefunding trading model, allowing local securities firms to secure the necessary capital for foreign institutional investors to settle trades. This effectively removed the prefunding requirement for such investors. In addition, a formal mechanism for handling failed trades was established.
Following these improvements, the FTSE Index Governance Board concluded that Vietnam now satisfies all the standards set in the FTSE Equity Country Classification Framework for secondary emerging markets.
The State Securities Commission of Vietnam (SSC) called the decision a major milestone, reflecting comprehensive reforms aimed at building a transparent, modern, and efficient capital market aligned with international standards.
The SSC attributed the achievement to coordinated efforts by the Government, the Prime Minister, the Ministry of Finance, the State Bank of Vietnam, and other ministries, as well as cooperation from stock exchanges, clearing entities, market participants, the media, and support from the World Bank, FTSE experts, and global institutional investors.
The commission said the upgrade marks the beginning of a new phase of development for Vietnam’s capital market, requiring continued deep reforms to achieve long-term goals. It pledged to work closely with FTSE Russell to ensure a smooth transition and to implement further measures to improve market access, modernize infrastructure, and enhance legal frameworks in line with global financial integration.
