The Hanoitimes - A survey on Vietnam’s business climate in the first three months of 2018 shows positive expectations from European firms towards Vietnam, said Nicolas Audier, co-chairman of European Chamber of Commerce in Vietnam (EuroCham).
The majority of EuroCham members aim to maintain or increase their investment in Vietnam, said a newly-announced survey by the Chamber on Business Climate Index (BCI) for quarter I, 2018.
“As shown in the survey’s results, almost 90% are either maintaining or increasing investment in the country,” commented Nicolas Audier on the survey.
Accordingly, EuroCham members that intend to maintain their level of investment in the country represent 45% of the total answers, a 9% increase from Quarter IV 2017. However, intentions to increase investment also remains substantial, although with a 7% drop in those thinking about significantly increasing their investments and an 11% hike in those that will so moderately. The share of answers indicating divestment is close to Quarter IV 2017 results.
The BCI score is 78, one point up from the previous quarterly survey. Generally, the sentiment of European and Europe-linked companies in Vietnam when it comes to the conditions for business in the Vietnamese market is moderately positive. Compared to the last quarter, respondents stating that the business situation was “Excellent” dropped almost 10%, and a 7% increase in respondents described the current context as “Good”, said the survey.
EuroCham members are also confident of a stable and continuously improving macroeconomic scenario for Vietnam increased by around 9%.
Besides, the survey results point out that inflation is not a major concern for European firms in Vietnam. 84% believe inflation will have either “no impact” (19%) or just a “minor impact” (65%, the majority of the respondents).
Meanwhile, 17% of respondents said, inflation would have significant impact on their businesses (slighly down against Quarter IV/2017). Merely 1% are afraid that inflation might threaten their businesses.
Regarding headcount, the number of businesses expecting to maintain the current size of their workforce remains at around 40%.
On the other hand, the scores indicating an intention to increase the number of employees say that 12% will significantly increase their workforce, while companies hiring moderately constitute 41% of all responses (same as the last quarter).
“EuroCham hopes that this interest inspires the Vietnamese Government to improve the business environment further, particularly regarding the changes to the legal framework that will enable Vietnam to fulfil its commitments under the EU-Vietnam Free Trade Agreement (EVFTA), expected to come into force later this year," said Nicolas Audier from EuroCham.