Vietnam touts IP crackdown results after US launches new probe, easing trade friction and supporting the VNM ETF.
VNM, the largest US-listed ETF tracking Vietnamese equities, advanced 1.2% after Vietnam published IP enforcement data directly responding to a new US trade probe. Reduced tariff risk and a potential thaw in trade tensions improve the earnings outlook for Vietnamese exporters, which constitute over 60% of the fund’s holdings.
The VNM tracks Vietnamese companies, many of which are exporters heavily exposed to US trade policy. Vietnam’s IP crackdown directly addresses a key US complaint, reducing the risk of tariffs that could hurt these firms’ revenues and margins.
Technology and consumer goods exporters stand to gain the most, as they face the highest risk from IP-related trade sanctions. The ETF’s top holdings include FPT Corporation, Vingroup, and Masan Group, all sensitive to US trade relations.
Vietnam reported a surge in seizures of counterfeit electronics and software following a US trade probe targeting intellectual property violations. Authorities highlighted legal reforms and enforcement actions to demonstrate compliance. The crackdown is viewed as a move to avert tariffs and safeguard the country’s trade surplus with the US, lifting sentiment in Vietnam-focused funds.
The US probe was launched due to rising complaints from American technology and pharmaceutical companies about patent infringement and software piracy in Vietnam, particularly in its booming electronics manufacturing sector. Vietnam’s large trade surplus with the US added pressure for action.
By proactively showing enforcement results, Vietnam hopes to avoid being labeled a Priority Foreign Country under US trade law, which could lead to sanctions. Positive findings in the probe could preserve tariff-free access and strengthen bilateral trade.