The Asia-Pacific region’s top-performing markets in the first half of the year will be India, Japan, and Vietnam, according to the news website CNBC of the United States.

The newswire outlines that similarly to India and Japan, Vietnam has benefited from the “China plus one” strategy with companies seeking to diversify investments to help reduce their reliance on the Chinese market.

The country therefore expects to see a 6% to 6.5% GDP growth ahead in 2024 on the back of robust imports and exports, as well as stronger manufacturing activity. 

The optimism surrounding the Vietnamese market has also led to a more than 14% surge in foreign direct investments last year compared with figures from 2022.

According to LSEG data, US$29 billion in foreign direct investments were pledged to Vietnam from January to November last year. 

In line with this, China accounts for half of the new FDI inflows into the nation, reflecting the attractiveness of the Vietnamese market as a rising manufacturing hub, Yun Liu, ASEAN economist at HSBC, said.

Now is the right time for financiers to invest in local stocks, Andy Ho, chief investment officer of VinaCapital Group, said.

“Over the next 6 to 12 months, Vietnam will be a good market as valuations are inexpensive at about 11 to 12 times earnings for 2023. That’s about a 20% to 25% discount to the regional average,” Ho told CNBC.

“The average daily trading volume in Vietnam has gone from US$500 million a year ago to about a billion dollars daily today,” he said, elaborating that investment opportunities can be found in the consumption, healthcare, and real estate sectors.

“People are beginning to recognize that when they have a lot of liquidity, they don’t want to put it in the bank because the interest rates now becoming uninteresting, and then looking at other options to invest,” he stressed.

Investors should also be bullish with regard to the Vietnamese e-commerce sector, Tyler Nguyen, vice-president and head of institutional equity sales at Maybank Securities Vietnam, said.

“We are seeing 20-30% year-on-year growth every year,” he told CNBC, pointing out that e-commerce accounts for only 2% to 3% of retail sales.

When asked about Vietnam’s possible entry into MSCI’s list of emerging market economies, Nguyen said the frontier economy was still “at a very nascent stage” but “we might see good news in 2025,”  he added.

VOV