Why Invest in Vietnam - The Demographic Advantage





We are not used to answering this question for the simple reason that our customers do not usually ask it. Indeed, this is not a question that many of our clients ask us simply because the majority of people who contact Anh Thomas Investment are people already interested in investing in Vietnam and most of them are already specifically interested in an investment in Vietnamese stocks in particular. Nonetheless, if you are finding yourself on this blog for the first time and still wondering whether you should consider investing in Vietnam or not, whether through investing in ETFs or buying stocks directly, it is still good to recall the reasons why investing in Vietnam makes so much sense these days. One of the first reasons to invest in Vietnam is linked to the demographics of the country. The population of Vietnam can be considered as being large, indeed the Vietnamese population will very soon reach 100 million inhabitants, but more interesting still, it is the demographic structure of the country that is a real strength. Much of the Vietnamese population is still young. Of course, this situation will change in the future, as in many countries around the world, but the current demography is a real strength for the country. It is really interesting to compare Vietnam to countries which were in the same economic situation and which went through the same transition allowing to go from the status of poor country to middle income country. Much of the Vietnamese population is still young. Of course, this situation will change in the future, as in many countries around the world, but the current demography is a real strength for the country. It is really interesting to compare Vietnam to countries which were in the same economic situation and which went through the same transition allowing to go from the status of poor country to middle income country. The situation in Vietnam is quite exceptional compared to that of the majority of other comparable countries, especially when you look at the birth rate. You will easily see that, for the moment, the birth rate of Vietnam has never really fallen below 1.8 or even more and that this birth rate tends to stabilize around 2, which is a close level. of what a country needs to replace its population in the long term. This figure may seem trivial to the untrained eye but it is important to realize that this figure is much higher than the birth rate of some other countries, especially in Asia. Likewise, if you look at European countries, for example, not only is the birth rate low and declining but the population is also quite old. Immigration could be seen as a solution to avoiding an economic downfall, but the reality is that when you rely too much on immigration, you also have other societal issues of different forms to deal with. Without being too political here because as you may know at Anh Thomas Investment we always take care to stay away from politics, it seems obvious that a country cannot rely 100% on immigration to solve its demographic problems.

On the other hand, Vietnam has so far managed to keep the birth rate at a satisfactory level, which could make a major difference in the coming decades. One only has to look at a neighbouring country like Thailand for example where the birth rate has dropped and is now close to 1 to be convinced. Italy is also an example of a country that will experience many difficulties due to its demographics in the near future. So, as we have seen, demography is a very important force in Vietnam at the moment, not only because its people are young but also because the country manages to maintain a satisfactory birth rate. It is also important to note that the Vietnamese are more and more educated and that the young Vietnamese are for the most part very hardworking and highly motivated. Most of them are hard workers and although it may shock Europeans at times, young Vietnamese are willing to work hard for the sole purpose of making as much money as possible. It is quite normal in Vietnam to show one's professional success by buying a nice car or wearing luxury jewellery. Even if you might agree or disagree with this way of thinking and living, what is certain is that a country with a young, intelligent and motivated population to work is a country that certainly has a golden future. 96% of Vietnamese can read and write, which is an incredible number for such a poor country. And if we had to add more, let's not forget 'the average age of the Vietnamese, which is only 31 years. Is Vietnam the perfect country to invest in? This might be an overstatement ... but we are certainly not too far from the truth.

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