Vietnam’s previously bullish investment outlook is facing fresh headwinds, according to a sobering update from PYN Elite Fund. In a letter sent to investors following the stock market turbulence on April 3–4, the Finnish-managed fund warned that 2025 is shaping up to be a “very challenging” year for investors—marking a notable shift in tone from recent optimism.
Just weeks ago, PYN Elite Fund Manager Petri Deryng likened Vietnam’s economic hand to a “full house” compared to other countries’ “weaker cards.” That confidence has been tempered by the U.S.’s unexpected announcement of a sweeping 46% reciprocal tariff on Vietnamese goods—triggering renewed concerns over Vietnam’s export vulnerability.
Global Trade Shockwaves Could Hit Vietnam Hard
Deryng pointed to former President Donald Trump’s return to aggressive trade policies as a destabilizing force for the global economy. “While Vietnam still holds many positives, sudden tariff moves like this threaten to undercut growth, particularly in exports,” he warned.
PYN Elite is now making tactical adjustments to its portfolio in response to this volatile new environment, assessing stock-by-stock performance to preserve value. Still, the fund remains heavily weighted in banking stocks, which currently make up around 50% of its holdings.
According to Deryng, the banking sector is relatively insulated from the tariff storm, as loans tied to FDI and export companies account for only a small share of total lending. Despite a slowdown in bank profits during 2023–2024 due to real estate woes, the fund anticipates stronger performance in 2025 as public investment ramps up and the property market rebounds.
Tariffs Could Slash Vietnam’s Export and GDP Growth
The 46% tariff shock from the U.S. has cast uncertainty over Vietnam’s key export industries. One such example is Vinh Hoan, a major pangasius exporter to the U.S., which makes up 2% of PYN Elite’s portfolio. Its outlook has now become less certain.
On the flip side, PYN Elite has increased its stake in MWG (Mobile World Group), even buying more shares during the April 3–4 dip when MWG stock fell by over 10%. The fund also quietly added a company linked to Vietnam’s infrastructure and private construction sectors, though it did not reveal the name.
Deryng voiced concern over allegations that Vietnam is acting as a transshipment point for Chinese goods en route to the U.S.—a claim that, if proven, could lead to stricter trade measures. However, the situation remains fluid, as a high-level Vietnamese delegation led by the Deputy Prime Minister is currently in Washington for negotiations.
Should the U.S. maintain the 46% tariff, Deryng estimates Vietnam’s exports to the U.S. could fall by 10–15%. This would translate into a direct hit to GDP, shaving off 1–3 percentage points from 2025’s growth target—bringing the projected growth rate down to just 4.5–6.5%, compared to earlier expectations of 7–8%.
Turning Inward: Vietnam May Boost Domestic Spending
With external risks mounting, PYN Elite expects Vietnam to pivot further toward domestic growth. The government is likely to double down on public investment and stimulate private sector activity to counterbalance global trade pressures.
Despite the turbulence, Deryng remains cautiously optimistic. “We continue to look for resilient sectors and long-term opportunities within Vietnam’s market,” he said.
As global trade enters a new era of uncertainty, Vietnam’s ability to adapt and remain competitive will be tested more than ever—and investors will be watching closely.
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Source: Vietnam Insider