ASART EMPOWERS YOU WITH INSIGHTS.

Did you hear the three bells ringing from all temples and churches, praying for Vietnam’s peace and prosperity as the country implements significant administrative and geographical mergers starting from July 1, 2025? This merger is part of a broader national reform that reduced Vietnam’s 63 provinces and cities to just 34, aiming to streamline governance and boost national development. While this change may seem insignificant to many provinces, for Ho Chi Minh City, it cannot be underestimated.

Is Mergers and Acquisitions (M&A) part of Foreign Direct Investment (FDI) and how significant it is to this capital pool? This article aims to dive into Vietnam’s FDI status in recent years and how M&A has becoming increasingly significant in its overall picture.
Despite global challenges such as geopolitical tensions, inflationary pressures, and elevated capital costs, ASEAN saw FDI inflows FDI inflows for the third consecutive year, with a record growth of 1.2%, reaching USD 226.3 billion in 2023.

Vietnam’s stock market has made significant strides, moving from a frontier market to the watchlist of becoming an emerging market since 2018, however there are still factors preventing an upgrade. Despite Vietnam’s significant weight in the Frontier Market, being stuck in a frontier market list has limited its growth and potentials. An upgrade would surely provide more room for expansion, attracting additional foreign investment and boosting the local economy, and benefiting investors, businesses and the entire ecosystem.

In recent years, particularly since the COVID-19 pandemic, prolonged low USD interest rates have spurred business investments, leading to inflation and market mismatches. The Federal Reserve’s rate hikes since March 2022 aimed to curb inflation have significantly impacted global economies, including Vietnam. This article delves into how high USD interest rates have affected Vietnam’s economic performance, focusing on Foreign Direct Investments (FDIs) and Mergers & Acquisitions (M&A) activities.

While the world enjoyed impressive growth in the number and value of Merger & Acquisitions (M&A) transactions despite COVID impacts in 2021, the first quarter of 2022 witnessed a declining trend. In 2021, as the pandemic was shadowing many aspects of the global economy, many businesses took initiatives for mergers and acquisitions, both horizontally (between direct competitors) or vertically (between companies that are in different segments in the value chain).