How to invest in Vietnam – an emerging market that shone in a difficult year

Vietnam has been one of Asia’s most promising markets for a long time. Now it is shaking off the global coronavirus crisis and looking better than ever, says Cris Sholto Heaton.

Vietnamese worker welding
Industrialisation has transformed Vietnam's economy
(Image credit: © HOANG DINH NAM/AFP via Getty Images)

The list of countries that managed to grow their economies last year is an unusually short one, which makes Vietnam stand out. Its GDP growth rate of 2.9% was low by historical standards – it typically manages 6%-7% – but still put it ahead of every other major economy in Asia and looks remarkable given the damage that the coronavirus pandemic inflicted on the world. Even at the peak of the crisis in the second quarter of the year, Vietnam just about eked out positive growth and has recovered quickly.

Many MoneyWeek readers will be familiar with the reasons to be bullish about Vietnam’s prospects – we’ve written about it a lot over the years. A large population (97 million), helpful demographics (average age of 32), decent education levels, rising urbanisation and industrialisation, and a manufacturing sector that has increased its share of global exports by more than any other country over the past decade – together this suggests great potential for sustainable long-term growth. In key respects, Vietnam resembles South Korea or Taiwan – which made a spectacular success of economic development – much more closely than some of its Southeast Asian neighbours that have not yet managed to rise so far.

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Cris Sholto Heaton

Cris Sholto Heaton is an investment analyst and writer who has been contributing to MoneyWeek since 2006 and was managing editor of the magazine between 2016 and 2018. He is especially interested in international investing, believing many investors still focus too much on their home markets and that it pays to take advantage of all the opportunities the world offers. He often writes about Asian equities, international income and global asset allocation.

Cris began his career in financial services consultancy at PwC and Lane Clark & Peacock, before an abrupt change of direction into oil, gas and energy at Petroleum Economist and Platts and subsequently into investment research and writing. In addition to his articles for MoneyWeek, he also works with a number of asset managers, consultancies and financial information providers.

He holds the Chartered Financial Analyst designation and the Investment Management Certificate, as well as degrees in finance and mathematics. He has also studied acting, film-making and photography, and strongly suspects that an awareness of what makes a compelling story is just as important for understanding markets as any amount of qualifications.