Iraqi Dinar (IQD) vs. Vietnamese Dong (VND) – Which Is the Better Investment?

When conversations around speculative investments arise, few topics spark as much curiosity—and debate—as foreign currencies from emerging markets. Two names that often make the rounds in these discussions are the Iraqi dinar (IQD) and the Vietnamese dong (VND). On the surface, both share common features: low face value, ties to developing economies, and a devoted following of investors who believe in their long-term potential. But peel back the layers, and you’ll discover key differences that might shape your view of which, if either, deserves a place in your speculative portfolio.

Let’s explore how these two currencies compare across multiple dimensions, from economic fundamentals to liquidity and revaluation potential.

Similarities Between IQD and VND in Investor Circles

At first glance, it’s easy to see why both the dinar and dong attract similar investor profiles. They share several notable characteristics:

1. Low Nominal Value: The psychological impact of acquiring millions of a currency for a few hundred dollars shouldn’t be underestimated. It makes investors feel like they’re getting in on the ground floor. With the dinar trading around 1,309 IQD to 1 USD and the dong sitting at roughly 24,600 VND per dollar, both currencies look “cheap,” even if actual value is a very different story.

2. Emerging Market Appeal: Iraq and Vietnam are classified as developing economies, each with its own set of challenges and growth stories. For speculative investors, emerging markets can offer ground-floor access to potential upside, provided the economies stabilize and prosper.

3. Speculation-Driven Communities: Online forums, blogs, and social media have fueled massive speculation, often centered around hopes of revaluation. This speculative optimism keeps both the IQD and VND in the spotlight, sometimes irrespective of macroeconomic data.

4. Limited Forex Accessibility: Neither currency is widely traded on global forex platforms. While the VND enjoys slightly more accessibility, both are far from liquid compared to major currencies like the euro or yen. This constraint creates inefficiencies, but for some, inefficiency also signals opportunity.

Economic Fundamentals: Iraq vs. Vietnam

Iraq

• Oil-Rich Economy: Iraq ranks among the top oil producers globally, with oil making up the vast majority of government revenue. This natural resource wealth underpins the country’s long-term economic narrative.
  
• Political and Security Challenges: Governance in Iraq remains unstable, and progress can be uneven. Yet recent initiatives to diversify the economy and modernize infrastructure offer glimmers of promise.
  
• Monetary Policy: The Central Bank of Iraq (CBI) operates a fixed exchange rate, pegging the dinar closely to the dollar. While this can provide short-term stability, it also limits appreciation potential unless a major policy shift occurs.
  
• Gold and Reform Signals: Iraq has been actively building its gold reserves, now among the highest in the Arab world. Coupled with a proposed “digital dinar” and monetary reforms, these moves suggest an evolving approach to financial policy.

Vietnam

• Diverse Export Base: Vietnam’s economy is significantly more diversified than Iraq’s. Electronics, textiles, agriculture, and manufacturing drive growth, positioning the country as a key player in global supply chains.
  
• Government Involvement with Flexibility: While still a socialist republic, Vietnam has embraced market reforms and encourages foreign investment. This has helped fuel GDP growth and improve investor sentiment.
  
• Managed Float System: The dong operates under a managed float system, offering more flexibility than Iraq’s fixed-rate setup. This allows the currency to better respond to market conditions, though it also introduces volatility.
  
• Trade and Global Integration: Strong ties with China, the U.S., and ASEAN nations provide Vietnam with a stable trade environment that supports currency stability over time.

Revaluation Speculation: Who’s More Likely?

• Iraqi Dinar: Revaluation theories around the dinar are persistent, but often misunderstand the nature of Iraq’s monetary policy. The CBI tightly controls the exchange rate, and any significant change would require legislative reform, economic stability, and broader global acceptance of the currency. While there is long-term potential—especially if Iraq transitions away from heavy reliance on oil—rapid gains should be viewed cautiously. A slow, steady path tied to reform and resource optimization is more realistic.
• Vietnamese Dong: Vietnam’s more flexible monetary system gives the dong some room to adjust based on market conditions. The country’s ongoing export success and relative macroeconomic stability offer an environment more conducive to gradual appreciation. However, don’t expect fireworks—appreciation is likely to be slow and steady, influenced by regional trade conditions and global interest rates.

Liquidity and Accessibility for Foreign Investors

• Iraqi Dinar: Purchasing and reselling dinar typically involves private dealers, as the currency is not openly traded on forex platforms. This adds layers of friction—fees, delivery delays, and lower resale value. While this illiquidity might deter some, others see it as a sign of an undervalued asset that has yet to hit mainstream recognition.
• Vietnamese Dong: The dong is more accessible, with certain financial institutions offering it directly. While still not a major forex player, its integration into international trade systems makes buying and selling easier. The Vietnamese government also works closely with international organizations, adding credibility and transparency.

Pros and Cons: Which Currency Has More Upside?

Final Thoughts:

In the debate between the Iraqi dinar and the Vietnamese dong, there’s no single right answer. It all comes down to your risk appetite, investment horizon, and belief in each country’s economic trajectory.

The dinar might appeal to those who think in decades and are comfortable taking positions in under-the-radar, resource-rich economies undergoing structural change. Its upside is tied less to daily market movements and more to geopolitical and economic reform over time.

The dong, on the other hand, is for investors who prefer a slightly more transparent environment, with a track record of growth and integration into the global market. It offers modest potential with less friction, but not without its own set of challenges. Both currencies can play a role in a highly diversified speculative portfolio. 

Neither is a guaranteed winner, but each carries the seeds of potential for those who do their homework, maintain realistic expectations, and stay grounded in macroeconomic fundamentals.