European businesses’ confidence on Vietnam outlook reaches highest since Covid-19 emergence
Vietnam is on the right path to achieving its twin goals of protecting health and promoting economic growth, stated Chairman of the European Chamber of Commerce in Vietnam (EuroCham).
Business Climate Index (BCI) measuring sentiment of European enterprises in Vietnam hit 73.9 points in the first quarter of 2021, the highest score recorded since the third quarter of 2019, before the Covid-19 pandemic took toll on global trade and investment.
|EuroCham's BCI movement.
The EuroCham revealed the latest data, saying this continues a positive upward trend in the index, with the score rising more than 47 points over the last 12 months.
“The BCI confirms once again that Vietnam is open for businesses. While countries continue to struggle with the impact of Covid-19, Vietnam has ensured that companies here can continue their operations as close to normal as possible. This is helping to drive economic growth and fuel the confidence of European business leaders,” EuroCham Chairman Alain Cany said.
“Therefore, it is no surprise that EuroCham members are positive about the future of their own companies and optimistic about the prospects for Vietnam’s trade and investment environment. The BCI has now almost climbed back to pre-Covid levels – this is a remarkable achievement and further evidence that Vietnam is on the right path to achieving its twin goals of protecting health and promoting economic growth,” he added.
The data came after Vietnam recorded strong economic growth of 4.48% at the start of 2021, and this is reflected in the optimistic outlook of European enterprises. When asked about the prospects of Vietnam’s business environment in the next quarter, 67% predicted either ‘excellent’ or ‘good’ – a 12% increase compared to the previous quarter.
|Production of electric components at A Chau Industry Company in Thuong Tin district. Photo: Thanh Hai
Meanwhile, business leaders are also more optimistic about their own companies. More than two-thirds (68%) predict that their orders and revenue will ‘maintain or increase’ over the next three months. That’s a 25% increase compared to the fourth quarter of 2020.
EuroCham members are also seeing a positive effect from the EU-Vietnam Free Trade Agreement (EVFTA) which entered into force on August 1, 2020. Since it was implemented, more than 60% have benefited from the agreement. However, business leaders continue to report that ‘administrative procedures’ are the biggest barrier preventing them from utilizing the EVFTA.
Thue Quist Thomasen, CEO of YouGov Vietnam, the agency conducting the BCI survey, said the fact that more business leaders are anticipating a rise in their headcounts and investment plan is – in itself – a vote of confidence in Vietnam’s long-term prospects. It shows that companies are investing in their workforce and their businesses now in anticipation of a strong and prosperous 2021.”
|The BCI is a regular barometer of EuroCham members and their perceptions of the business environment. Each quarter, it tracks the performance of EuroCham’s member companies and their perceptions of the economic outlook in Vietnam. The fieldwork and data collection for the BCI is conducted by YouGov Vietnam.
- Jan-Feb: Hanoi leads in foreign investment registration
- Vietnam accelerates plan to train 50,000 semiconductor engineers
- Vietnam aims to export US$16 billion worth of timber this year
- Prime Minister Pham Minh Chinh expects more from Siemens’ local operations
- Hanoi to host new high-value IT parks
- Vietnam's labor market soars with 51.7 million employed in Q1
- Hanoi envisions becoming leading semiconductor center
- Vietnam to produce clean hydrogen by 2030
- PM urges major mobile carriers to lead in semiconductor chip research
- Supermarkets in Hanoi offer post-Tet promotions to boost demand
Potential upgrade to emerging status may pull US$25 billion into Vietnam’s stock market
Jan-Feb: Hanoi leads in foreign investment registration
Vietnam news in brief - February 28
Photo exhibit celebrates motherhood on International Women's Day
Vietnam accelerates plan to train 50,000 semiconductor engineers
Siemens interested in Hanoi's metro projects: CEO Roland Busch
Prime Minister Pham Minh Chinh expects more from Siemens’ local operations
Tales of recruits: Answering the nation’s call
Vietnam's 2024 Top 10 most welcoming cities