European business leaders remain confident about doing business in Vietnam and optimistic about the future prospects of the country’s economy, according to new data from EuroCham’s Business Climate Index (BCI) survey.
The BCI, which is sent to EuroCham’s one thousand members each quarter, shows how European enterprises and investors view the prospects of their own companies and Vietnam’s broader macroeconomic trade and investment environment. Overall sentiment rose slightly in the second quarter of 2019, increasing by one point on the previous quarter to reach 80 percent. However, this is slightly below the record-highs seen in the second half of 2018.
Regarding the health of their own companies, 65% of respondents said that their business status was either “Good” or “Excellent”. Just 8% said that their business was in poor health. Looking ahead to the next quarter, EuroCham members are optimistic about their future prospects of their enterprises. Around two-thirds (68%) anticipated that their business would perform just as well - if not better - in quarter 3 of 2019.
When asked about the state of the Vietnamese economy, 58% of respondents predicted “Stabilisation and Improvement”, with around half as many (30%) anticipating a “Deterioration”, a figure consistent with the previous quarter. This positivity is echoed in the fact that around half of businesses plan to increase their headcount in the next quarter, with 43% planning to grow their investment in Vietnam and 64% anticipating an increase in orders.
Commenting on the BCI, Nicolas Audier, Chairman of EuroCham, said:
“European enterprises remain confident about doing business in Vietnam and optimistic about the future prospects of trade and investment in the country. Our Business Climate Index, in which hundreds of EuroCham members give us their opinion on Vietnam’s business climate, continues to show strong results. The most recent data, from quarter 2 of this year, saw a slight increase in positive sentiment from 79 to 80 percent on the previous quarter. And almost 70 percent of our members predicted that the outlook of their own company would be just as good - if not better - than the previous quarter. Not surprisingly, therefore, over half of respondents plan to recruit more staff and grow their business in Vietnam; creating more jobs and boosting investment in the process. Meanwhile, well over half of our members expected Vietnam’s business environment to continue improving in the near future.”
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