The Trade20 Index recently released by British lender Standard Chartered Bank ranks 20 economies out of the 66 based on 12 metrics across three pillars: economic dynamism, trade readiness and export diversity.

The economic dynamism pillar was measured by inward foreign direct investments (FDI), export volume growth and GDP growth. Trade readiness refers to the market’s foundations to support future trade growth, and was measured by factors such as the quality of trade and transport infrastructure and ease of doing business, while export diversity was measured by export count.

Vietnam showed the strongest progress in trade growth potential of all Southeast Asian markets, driven by improvements to its trade readiness and economic dynamism.

Its improving strength in trade readiness is due to infrastructure enhancements and improvements to its ease of doing business score, while its economic dynamism is driven by healthy growth, particularly in terms of export volumes, the report said.

Ricky Kaura, transaction banking head of East, Standard Chartered, said: "The Vietnamese economy is the fastest-growing in the region, which has benefited from an open economy. The government has reached free trade agreements and foreign direct investment (FDI) continues to flow into the country, especially as US-China trade tensions intensify."

In June Vietnam signed a landmark trade deal with the EU, hailed as the most ambitious trade agreement that the EU has signed with a developing economy, the report said.

It eliminates 99 percent of all tariffs and is also expected to open up the public procurement and services markets, it said.

The EU is Vietnam’s second largest export market after the U.S., and the Vietnamese government has said the agreement could boost EU exports to Vietnam by over 15 percent, and Vietnam’s exports to the EU by 20 percent by 2020.

Africa’s Ivory Coast topped the list as an "emerging market fast improving its trade readiness." India followed at second place and was hailed as "a future giant of world trade". Rounding off the top five were Kenya, China, and Ireland.