Yes, kind of. The name is two words. Nam 南 southern, Viet 越 tribe(s) or ethnic groups of southern China. Early name was written as Nam Viet...and more recently as Viet Nam, or just merged as Vietnam.I'd guess that it's because their language is monosyllabic.
Still, convention is to merge names...people do not generally write Bei Jing, Tai Wan, or Kyo To. How about Hong Kong (since 1926) though? Conventions need not define all cases, and Viet Nam is common (Cộng hòa Xã hội chủ nghĩa Việt Nam).