With strong GDP growth, a stable macroeconomic environment, increasing exports, and record levels of foreign direct investment, it is easy to see why Vietnam is considered among the world’s most exciting markets. Half of the population of 95 million is under age 35, and an expanding middle class has created a compelling domestic consumption story that has attracted the attention of companies from around the globe.
VOF gives investors access to a range of carefully selected investments in the listed and private companies that are participating in, benefitting from, and driving the sustainable growth Vietnam is experiencing today.
Latest commentary from our fund manager
“The best-laid plans of mice and men…”, To A Mouse by Robert Burns (1786)
Vexing quarantine and social distancing rules continued to bear down on economic activity during August, with 3Q21 economic data shaping up to be disappointing. Nevertheless, as discussed in detail in the macroeconomic commentary that follows, a surprisingly strong domestic currency (despite a widening trade deficit) and better-than-expected manufacturing data for 8M21 (vs 8M20) hint at a possible manufacturing-led recovery. Current and new FDI projects continue to flow into Vietnam, notwithstanding some negative headlines in the international media in recent weeks regarding the country’s handling of the latest COVID outbreak.
While August and September saw severe movement restrictions, particularly in Ho Chi Minh City (HCMC), the economic centre of the south, it appears increasingly likely that October will see a loosening of some of the strictest measures, as the Government’s approach turns towards “living with the virus safely” under a “new normal”. Vaccination rates have steadily improved, with priority given to HCMC as it continues to aggressively roll-out the first dose of vaccines, with an increasing number of people receiving a second dose. Complementing this vaccine roll-out is the adoption of electronic vaccine passports, which will be useful as part of the reopening strategy. Overall, these measures, while perhaps a little late, seek to restore Vietnam’s regional and global competitiveness, and not lag in economic recovery.