European firms optimistic about Vietnam’s business environment
Updated : Tuesday, July 10, 2018 9:37 AM (GMT+0700)

Europeanfirms continued to be optimistic about the business environment in Vietnam,according to the EuroCham’s latest Business Climate Index (BCI).

Illustrative photo - Photo: VNA

Accordingly, the BCI for thefirst quarter of 2018 is 78 points, up 1 point from the previous quarterly survey.

However, the percentage ofrespondents rating the business situation as excellent dropped by nearly 10percent, with an increase of 7 percent in respondents describing the situationas good. Negative responses were at almost the same level as in Q4 of 2017.

More respondents showedtheir confidence of a stable and continuously improving macroeconomic scenarioin Vietnam with a 9 percent increase, while those expecting no change in thenext quarter increased by nearly 10 percent.

The survey showed that inflationwas not a major concern for EuroCham members, with 84 percent believing it willhave either no or minor impact.

Regarding headcount, thenumber of businesses expecting to maintain the current size of their workforceremained at 40 percent, while 12 percent will significantly increase theirworkforce. Responses indicating intention to reduce headcount a little bitaccounted for 5 percent compared to 10 percent in the previous quarter.

Meanwhile, 45 percent of therespondents said they intend to maintain their level of investment, a 9 percentrise.

EuroCham Co-Chairman NicolasAudier said that the BCI survey results for Q1, 2018 continued to show positiveexpectations from EuroCham members toward Vietnam, albeit not at the samelevels of optimism as in 2016.

“EuroCham hopes that thisinterest inspires the Vietnamese Government to improve the business environmentfurther, particularly regarding the changes to the legal framework that willenable Vietnam to fulfil its commitments under the EU-Vietnam Free TradeAgreement, expected to come into force later this year”, he said.

Audier noted that eventhough the BCI score is very positive (78 out of 100), there is still quitesome legal and regulatory work to do in Vietnam.

He added that EuroCham isconfident that current hurdles to liberalisation will be surpassed and the nextsurvey will again reflect an excellent outlook from the perspective of theEuropean and Europe-related business community in Vietnam.


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