Twelve Angry Percent
The US tariff verdict is in; Vietnamese equities deliberate
In the 1957 classic, ‘Twelve Angry Men’, Henry Fonda’s character is the lone voice of opposition to a jury’s almost unanimous instinct to levy the full force of judicial power against an innocent victim. Through debate and consideration, a more balanced outcome emerged. Last April saw a whopping 46% levied against Vietnam from the Rose Garden (when it still had grass) against a minimum baseline of 10%. We may have thought the tariff rollercoaster ride film had ended back at 10%, but Season Two seems to be upon us. The Jury is still out on the final landing point and its impact.
On 24 July, the USTR's additional tariffs on some 60 investigated economies took effect, with Vietnam placed in the higher 12.5% band, replacing the flat 10% duty that had applied since the courts unwound the earlier ‘illegal’ emergency-powers tariffs. Talks continue, and Bloomberg reports the US is pressing Hanoi on non-tariff barriers, intellectual property and economic security as the two sides wrangle towards a fuller deal. For the world's factory-in-chief for trainers, phones and furniture, a couple of percentage points is real money. These ‘Section 301’ tariffs are slightly higher than those imposed on Bangladesh, Cambodia and Indonesia, so may have some impact on order flow, but are unlikely to derail the Made in Vietnam momentum anytime soon.
Vietnam is a genuine manufacturing powerhouse - Nike confirmed Vietnam as its largest global manufacturing base for the fourth year running; the country produces half its total footwear output. But Vietnam is also a fake manufacturing powerhouse, and the authorities are keen to take action against the fraudsters, busting a producer of over 50,000 pairs of fake Nikes.
Foreign Direct Investment (FDI) continues to arrive at record levels in Vietnam, with over US$ 35 billion registered in the first six months. The impacts of this are not currently felt in the stock market, at least not directly. As the name suggests, most of the actors are foreign multinationals, and Vietnam has not yet fully taken advantage of building the domestic sub-component supply chain that would benefit. Banks and other business-to-business services, such as logistics and transportation, benefit, and these feature in most well-constructed portfolios. But even for these portfolios, the valuations are at record lows. Somehow the equity market needs a catalyst.
So, here's to this week's News…
Made in Vietnam
Vietnam remains Nike's largest global manufacturing base for 4th year in row — The Investor. Tariff headwinds notwithstanding, the world's biggest sportswear brand is a large part of the Made-in-Vietnam story.
Vietnam's semiconductor market set to grow by $2.22bn by 2030 amid investment surge — VnEconomy. At the Vietnam–Singapore Semiconductor Industry Cooperation Forum in HCMC (21 July), experts put market growth at $2.22 billion between 2025 and 2030 (roughly 7.1% CAGR), with Marvell, Renesas, Infineon, Qualcomm and Nvidia among those already invested.
Vietnam's QTSC, Singapore's SSIA to cooperate in semiconductor training, R&D, investment promotion — TNGlobal. The follow-through from the forum: a training and R&D tie-up between Quang Trung Software City and Singapore's semiconductor industry association. Less glamorous than a fab announcement; arguably more important.
US agency slashes estimate of Vietnam's rare earth reserves in major revision — Mining.com. A dose of humility for the "picks and shovels" thesis: the USGS has cut its estimate of Vietnam's rare earth reserves from 22 million to 3.5 million tonnes, dropping the country from 2nd to 6th globally.
In investments we Trust
VN-Index fell nearly 17 points, ending the third consecutive week of correction — Vietnam.vn. The weekly tally: down 40.89 points (2.23%) to 1,686.11, a third straight losing week, with foreign investors net sellers of $73 million across the exchanges. This continues the net selling by foreign investors that started more than 18 months ago. Excluding Vingroup, the Vietnam market trades at around 10x earnings.
US pushes Vietnam on trade barriers, IP violations in deal talks — Bloomberg. Behind the tariff headline, the negotiation continues: Washington wants movement on non-tariff barriers, intellectual property and economic security cooperation. The shape of any final deal matters more than this week's rate.
Techcombank's Q2 profit hits record high on diversified growth drivers — The Investor. A reminder that earnings season is quietly delivering: Vietnam's leading private lender posted record quarterly profit across key indicators. The economy behind the index is in better shape than the lacklustre market performance suggests.
Toward Net Zero
From boom to balance in Vietnam's clean energy transition — IEEFA. The sector's biggest cloud: authorities are looking to retroactively revise purchase prices for 173 solar and wind projects, cutting revenues by 25–46%. Investor confidence in the energy transition is hard-won and easily lost.
US energy giants GE Vernova, ExxonMobil reaffirm long-term commitment to Vietnam — The Investor. GE Vernova has named Vietnam one of its top priority markets globally, and ExxonMobil says its portfolio review won't dent its commitment here. Vernova has been a global beneficiary of the push for powering data centres.
Vietnam aims to cut energy demand, boost rooftop solar — The Asset. An often overlooked way to help with the energy transition: a target to save at least 3% of national electricity consumption in 2026, alongside a rooftop solar push. Under PDP8, solar and wind are slated to exceed 60% of installed capacity by 2050.
One for the road
Diamonds may not be a girl’s best friend. Michael Tatarski continues his coverage of the crackdown on smuggled diamonds. Reporting this week that police in Thanh Hóa Province prosecuted four people for smuggling diamonds, including the head of the business department at state-owned SJC (Saigon Jewelry Company), one of Vietnam’s largest jewellery businesses. Earlier this month police detained 22 people for smuggling and trading diamonds illegally imported from Hong Kong and originally sourced from India. This included the former head of P-Lab, the certification subsidiary of the publicly listed Phu Nhuan Jewelry (PNJ). (Until recently, PNJ was one of our portfolio companies)
EndNotes
Vietnam's Economic Statecraft in the Global Chip Race — The Diplomat. A thoughtful long read on whether Hanoi's semiconductor push will genuinely build technological capability, or just relabel assembly. The honest answer: the policies are the easy part.
Wave of IPOs, capital hikes poses market test as supply surges — The Investor. Tens of billions of new shares are queuing up to enter the market just as liquidity thins. A test — and, for the patient, a pipeline.
Viva Vietnam is a curation of news published by Dynam Capital, Fund Manager of Vietnam Holding (LSE: VNH). AI has been used in the collation of news items; however, the final selection, the editorial and any mistakes are all too human. Nothing contained in this newsletter is investment advice.