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ASEAN's dividend opportunity is underpinned by diverse and evolving market characteristics. The FTSE ASEAN Index, which captures the large- and mid-cap companies listed in the five ASEAN markets - Singapore, Malaysia, Indonesia, Thailand and Philippines - has delivered a 10-year average dividend yield of 3.57%. Across multiple market cycles over the past 25 years, a back-test of the FTSE ASEAN ex REITs Target Dividend Index's strategy showed notable resilience during market downturns and lower overall volatility compared with the broader ASEAN market.
Vietnam has rapidly closed the gap with EM ASEAN peers, surpassing the Philippines in GDP per capita and equity market capitalisation, and moving closer to Indonesia. Vietnam's economic transformation has been driven largely by manufacturing and its growing role in the global tech supply chain.
Last week FTSE made its annual review of country classification within its global equity indices (see the announcement here). One of the most interesting changes was Vietnam's upgrade from frontier to emerging market.
July 2025 proved to be a compelling month for ETF investors, marked by a return to risk-on sentiment in some areas of the market, even as broader economic signals remained mixed. U.S. stocks saw a strong 2.2% rally, offsetting a decline in international markets.
The S&P 500 (SPY) rallied 5.7% this week but remains down 5.4% since the close on "Liberation Day" on 4/2. The average country ETF is down 4% since 4/2, so SPY has underperformed that since Trump's Rose Garden announcement. Asian countries like Vietnam (VNAM) and Thailand (THD) had some of the harshest reciprocal tariffs announced on Liberation Day, and since the pause, these two have bounced back 16.7% and 14.1%.
US equities have outperformed the rest of the world for a long time now. While the US is up 58% on a total return basis during the current bull market, the rest of the world is up 13.5 percentage points less at +44.5%. Looking at the international dividend ETF over a longer time frame, over the last five years, it's up 20.6% in price and more than double that on a total return basis.
While the China macro story of ongoing transition is a headwind to the rest of Asia, there is more to the region's economic health than this.
The total nominal GDP of the ten ASEAN nations measured in US dollar terms amounted to USD 3.6 trillion in 2022, more than doubling compared with total GDP of USD 1.6 trillion in 2009. Singapore's GDP growth rate improved to a pace of 2.8% y/y in the fourth quarter of 2023 according to the advance estimate of GDP from the Ministry of Trade and Industry (MTI).