Data from the survey of Quarter 4’s Business Climate Index (BCI) by Decision Lab for EuroCham has revealed that European business leaders ended 2018 more positive about the future of their enterprise and of the economic climate in Vietnam. Nearly 250 companies, investors and individuals responded to the latest BCI, covering the fourth quarter of 2018.
Confidence in Vietnam’s trade and investment environment, now at 84 points, saw business sentiment end 2018 on a high, and return to its joint-highest level since the end of 2016.
EuroCham members were more positive about their business situation in quarter 4, with 76 per cent describing their business situation as either ‘Excellent’ or ‘Good’, up 8 per cent compared to the previous quarter. Meanwhile, more than 7-out-of-10 business leaders were optimistic about the future, with 74 per cent anticipating a positive start to 2019.
Quarter 4 also saw a significant increase in optimism about Vietnam’s macroeconomic outlook, with 67 per cent predicting ‘Stablisation and Improvement’, up from 58 per cent in quarter 3 of 2018. Just 9 per cent of respondents foresaw a worsening economic outlook.
The BCI, now conducted with Decision Lab, also looks at the detail of business operations of EuroCham members, asking about issues from staffing and investment plans to revenue prospects for the next quarter. Over half of business leaders anticipate growing their workforce in quarter 1, with 49 per cent anticipating a ‘Moderate’ and 7 per cent predicting a “Significant” increase.
EuroCham members also sent a positive signal about their future investment plans in Vietnam, with almost 6-out-of-10 planning either a ‘Moderate’ (47 per cent) or ‘Significant’ (11 per cent) increase. This is 6 per cent higher than in the previous financial quarter.
Denis Brunetti, Co-Chairman of EuroCham, said: “EuroCham’s latest BCI shows that optimism and confidence are growing across the board. Our members report strong and positive signals both about their own business prospects, but also about Vietnam’s wider trade and investment environment. This data is further evidence that Vietnam is going from strength to strength, and that there is a bright future for European trade and investment in Vietnam.”
Nicolas Audier, Co-Chairman of EuroCham, added: “Vietnam has been on the radar of European investors for some time, and their interest continues to increase as we approach the final stages of ratification of the EU-Vietnam Free Trade Agreement (EVFTA). Earlier this month, I was honoured to join the Prime Minister of Vietnam at the World Economic Forum in Davos, Switzerland, where we met with European business leaders to further strengthen the ties between Vietnam and Europe. Our latest BCI shows that European companies are right to be optimistic about investing in Vietnam. Now, the challenge for both business and Government is to redouble our efforts to get the EVFTA ratified and implemented as soon as possible.”