Vietnam’s stock market can attract US$25 billion from foreign investors by 2030 if it is upgraded from Frontier to Emerging, according to the World Bank.

The upgrade is a strategic step for Vietnam to become a high-middle income country by 2035 and high income by 2045, Ketut Ariadi Kusuma, senior financial sector specialist at the Finance & Markets Global Practice, World Bank Group, said at a recent event.

It would increase foreign investors’ access to the market, and they could invest as much as $78 billion if Vietnam makes strong reforms to the insurance industry and its investment environment.

U.S.-based finance firm MSCI classifies a market as Frontier, Emerging or Developed. Vietnam hopes to be upgraded to Emerging market status by 2025.

A higher classification means a market has a larger number of companies that meet a certain market cap and liquidity requirements.

Other criteria are market accessibility, which includes openness to foreign ownership, ease of capital inflows and outflows and availability of investment instrument.

Kusuma said to be upgraded Vietnam needs to increase the foreign ownership caps for stocks and privatize more state-owned companies.

If foreign ownership remains limited Vietnam could only attract $5 billion, but if it is increased that number could go up to $8-15 billion, he said.

Luu Trung Thai, chairman of lender MB, said increasing the quality of the assets on the stock market is important to achieve the higher status, and foreign investors would seek opportunities when there are good assets.

Chairwoman of the State Securities Commission of Vietnam, Vu Thi Chan Phuong, said the watchdog is working with various entities to resolve certain issues faced by the stock market to help speed up the upgrade.

Prime Minister Pham Minh Chinh has said he pays close attention to the country’s financial markets and regularly discusses measures to develop them with other government leaders.

He has tasked related government agencies with removing obstacles to the upgrade process and reporting back to him by June.

Deputy Minister of Planning and Investment Nguyen Thi Bich Ngoc said that many foreign companies want to list their shares in Vietnam and urged securities authorities to speed up the process of approving such listings.

Vietnam saw a surge in foreign listings in 2003-08, but there are now only six of them now.

Some large companies, such as CP Vietnam, a subsidiary of Thailand’s Charoen Pokphand Foods, have expressed interest in listing.

Chinh has ordered the Ministry of Finance and the State Securities Commission of Vietnam to mitigate difficulties that foreign companies might face during the listing process.

VnExpress