Viet Nam seeks credit rating upgrade to unlock cheaper global funding
Viet Nam is pushing for a sovereign credit rating upgrade to strengthen its economic position and lower borrowing costs. The government has also been working on reforms to transition from frontier to emerging market status, with support from global financial institutions like HSBC. HSBC has long been a key partner for Viet Nam, advising on major sovereign bond issuances in 2005, 2010, and 2014. Now, the bank is expected to assist again as the country seeks a credit rating upgrade and deeper access to international capital. Viet Nam's efforts include finalising a green taxonomy, developing a carbon credit market, and boosting sustainable finance initiatives.
To improve its market classification, the government has already shortened stock settlement cycles from T+3 to T+2. It has also tightened pre-funding rules for foreign investors, relaxed ownership limits in certain sectors, and enhanced transparency. Rating agencies like FTSE Russell and MSCI have acknowledged these steps but stress the need for full T+2 implementation and better data access before full reclassification. Viet Nam is also preparing to re-enter global bond markets with a focus on cost efficiency. By the end of 2025, its government bond market was valued at VNĐ2.62 quadrillion (US$99.5 billion), making up 20.4 per cent of GDP. The country plans to increase outreach in major financial centres and launch investor engagement campaigns. Beyond advisory work, Viet Nam is seeking HSBC's help in training programmes and secondments for officials. The bank has reaffirmed its commitment to Viet Nam as a priority market, promising to keep facilitating global capital flows into the country.
A higher credit rating would make Viet Nam more competitive and attract long-term institutional investors. The government's reforms and partnerships with institutions like HSBC aim to secure better access to international funding while advancing sustainable finance goals. The next steps include further market upgrades and expanded investor engagement efforts.
