As Bloomberg reports, Vietnam is lifting foreign ownership limits because it is angling for a coveted but rare promotion to emerging markets status from the frontier markets classification from index provider MSCI.
Last year, Vietnam formed a commission to explore taking the necessary steps for the country to shed its frontier status and gain entry into the widely followed MSCI Emerging Markets Index.MSCI does not have Vietnam on its list of markets that could potentially be upgraded to emerging markets status. When the index provider recently revealed its annual market classification, Pakistan was the only frontier market highlighted as being a potential candidate for promotion to the MSCI Emerging Markets Index. [Vietnam Wants EM Promotion]
Vietnam is currently the ninth-largest country weight in the iShares MSCI Frontier 100 ETF (NYSEArca: FM) at 3.24%. Vietnam’s equity market is valued at $58 billion, or $21 billion less than the market cap of Dow component American Express (NYSE: AXP). Investors have allocated $54.3 million to VNM in the current quarter and $57.5 million this year.
Market Vectors Vietnam ETF
