US firm considers Vietnam appealing investment destination
Vietnam could be an appealing investment for investors seeking growth exposure outside of traditional emerging markets, according to a recent market insight analysis by the US investment management firm VanEck.
Vietnam's transition from a frontier to an emerging market and points to the reforms that have led to its remarkable growth, according to an analysis by VanEck. (Photo: VNA)
Hanoi (VNA) - Vietnam could be an appealing investment for investorsseeking growth exposure outside of traditional emerging markets, according to arecent market insight analysis by the US investment management firm VanEck.
As reported by the news site asiafundmanagers.com, the analysissaid the country’s transition from a frontier to an emerging market and pointsto the reforms that have led to its remarkable growth.
“Vietnam’s economic reforms have created a virtuous cycle:reforms spurred exports, which in turn drove economic growth, leading to increaseddomestic demand. This trajectory has positioned Vietnam as a dynamic andintegral part of the global economy, with a domestic market that continues toshow robust growth potential,” said John Patrick Lee, Product Manager atVanEck, as quoted by the site.
Lee further pointed out that Vietnam’s economic growth isbuoyed by its young and growing population. With over 60% of the populationunder 30 and a literacy rate above 90%, this dynamic is fostering a strongdomestic demand driven by a burgeoning middle class with rising disposableincome. Compared to other emerging markets, Vietnam’s private consumption ratioto GDP ranks it mid-range, higher than Saudi Arabia and China but lower thanBrazil and the Philippines. This robust domestic demand offers Vietnamresilience against external challenges.
When it comes to the equity market, VanEck believes thatVietnam is an emerging opportunity investors should look closely at. Lee alsosaid he sees the biggest equity opportunities in financials, real estate andconsumer staples./.
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As the COVID-19 pandemic has subsided and the world is facing many challenges such as inflation, energy crisis, and geopolitical competition, the Vietnamese economy has grown well and higher than its peers in Southeast Asia, said Professor Vladimir Mazyrin, leader of the Centre for Vietnamese and ASEAN Studies under the Russian Academy of Sciences’ Institute of China and Contemporary Asia.
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