In the latest announcement, FTSE Russell is set to publish the results of its annual equity market classification review after the US market close on October 7, 2025, corresponding to October 8, 2025, in Vietnam.
Currently, two markets are on the watchlist for potential upgrades: Vietnam, which is awaiting reclassification from a frontier market to a secondary emerging market, and Greece, which may be promoted from an advanced emerging market to a developed market.
Source: FTSE
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This review has been highly anticipated by both the Vietnamese market and the international investment community, as the country has met most of FTSE’s criteria. In its recently published report, “The Flying Dutchman,” HSBC revealed that Vietnam has fulfilled seven out of nine criteria in the “Market Quality” framework. The criteria pertaining to market capitalization, liquidity, and the presence of large stocks have all been successfully met.
Significant progress has also been made towards the remaining two criteria, “Settlement Cycle” and “Failed Trade Costs.” The amended Securities Law, enacted in late 2024, eliminated the requirement for pre-funding when purchasing stocks and introduced provisions for English-language disclosure—marking important steps towards international standards.
The introduction of the KRX trading system in May 2025 brought about a technical breakthrough. It not only addressed order congestion but also significantly enhanced the capacity to handle large transactions. More importantly, KRX paved the way for the implementation of the Central Counterparty (CCP) mechanism, enabling more efficient and simultaneous trade execution and settlement.
“Will Vietnam be upgraded? Market sentiment leans towards an upgrade. Despite US tariffs, Vietnam’s stock market has surged 40% year-to-date, making it one of the world’s best-performing markets,” HSBC stated in its report. However, the bank also noted that FTSE would seek feedback from investors and brokers before making a final decision.
If FTSE decides on an upgrade in October, the transition process typically takes 6-12 months to allow funds sufficient time to prepare and adjust their portfolios. According to HSBC estimates, an upgraded Vietnam could attract over $10 billion in passive and active funds.
HSBC: Vietnam Moves Closer to FTSE Upgrade Target
At the recent Vietnam Blockchain Day Danang 2025 event, Ms. Wanming Du, Head of Policy at FTSE, shared insights from her productive meeting with the State Bank of Vietnam and the State Securities Commission of Vietnam on August 28. “FTSE Russell understands the significance of this to Vietnam and to investors, and we take this responsibility very seriously,” she emphasized.
According to Ms. Wanming Du, Vietnam has come a long way, transforming within two decades from a frontier market to a regional leader in liquidity. The next chapter involves building a more balanced ecosystem that supports long-term growth and unlocks the potential of the economy. FTSE plays a special role in this journey, with its indices representing thousands of billion USD in assets and a rigorous and transparent market classification framework.
“We not only assess markets, but we also help shape them. Vietnam is rapidly evolving with traditional reforms, digital innovation, and sustainable finance. It is one of the most attractive investment destinations in the world today,” Ms. Wanming Du remarked, adding that FTSE is committed to close collaboration rather than mere assessment.
FTSE has maintained continuous dialogue with the Securities Commission, the Ministry of Finance, the State Bank, and other stakeholders, reflecting a strong belief in Vietnam’s long-term potential.
– 11:24 09/06/2025
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