Illustrations by Nilaksiya Thiruchelvam
As with any investment, your capital is at risk.
In a decade of investing in Vietnam, I’ve seen the country of 100 million people become one of the best of all emerging-market export-growth stories. Foreign manufacturers thronged, supply chains deepened, and ports thrived. All this despite recent trade wars and geopolitical tensions.
A notable gap was the absence of strong domestic growth. The “blazing furnace” anticorruption drive, which began in 2013, brought discipline but froze decision-making. The property market stalled, pressure built in the banking system, and a small bond crisis followed. Factories kept running for global customers such as Samsung and Nike.
But Vietnam faced the dreaded “middle-income trap” – failing to compete on wages without moving up the value chain.
I see exciting signs it can spring free. The new leader, To Lam, is the antithesis of his predecessor. His unprecedented reforms emphasize momentum, not enforcement. Annual GDP growth is already 8 percent – Lam is targeting 10 percent. He’s restoring confidence, unblocking investment and allowing the private sector to do what it does best: grow.
Meanwhile, index provider FTSE Russell is upgrading Vietnam from a “frontier” to an “emerging” market, potentially attracting billions of dollars in new investment.
Baillie Gifford backs companies, not countries. But we see our holdings in Vietnam benefiting as reforms boost confidence. Winners could include:
- Mobile World, one of Vietnam’s best-known retailers, selling everything from smartphones and electronics to household essentials in a national network of stores.
- FPT, a home-grown technology champion spanning IT services and software, telecoms and education, which stands to benefit as businesses upgrade their systems and the state spends heavily on digital infrastructure.
Both are held in our Emerging Markets portfolios.
Risk factors
The views expressed should not be considered as advice or a recommendation to buy, sell or hold a particular investment. They reflect opinion and should not be taken as statements of fact nor should any reliance be placed on them when making investment decisions.
This communication was produced and approved in April 2026 and has not been updated subsequently. It represents views held at the time of writing and may not reflect current thinking.
Potential for profit and loss
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The images used in this communication are for illustrative purposes only.
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