European investors upbeat about Vietnam’s business landscape
EuroCham Chairman Gabor Fluit commented that there was definitely a positive trend underway, and while there was a long way to go for a full recovery, businesses were feeling more hopeful.
“The European business community is increasingly optimistic that the most challenging economic period is now behind,” he said.
Inside a company at Yen Phong Industrial Park, Bac Ninh province (Photo: VNA) |
The last quarter of 2023 saw a marked increase in satisfaction among the businesses, with firms confident in their current situation rising from 24% in Q3 to 32% in Q4.
In Q4, Vietnam’s investment hotspot status increased significantly. An impressive 62% of those surveyed ranked Vietnam among their top ten global investment destinations, with 17% placing it at the very top. This strong endorsement was matched by 53% of respondents anticipating increased foreign direct investment (FDI) in Vietnam by the end of that quarter.
Last year, the potential of the EU – Vietnam Free Trade Agreement (EVFTA) was increasingly realised by businesses. By Q4, a significant 27% of companies reported experiencing “moderate” to “significant” benefits from the agreement, a marked increase from just 18% in Q2.
They said the foremost advantages of the trade pact were “tariff reductions or eliminations” (42%), “increased market access to Vietnam" (27%), and “improved competitiveness in Vietnam” (25%), indicating substantial economic impacts.
However, the BCI survey also revealed challenges in fully leveraging the EVFTA’s potential. About 13% of the respondents cited “uncertainty or lack of understanding of the agreement” as a primary obstacle, suggesting a need for more clarity and education around the agreement’s provisions.
Gabor Fluit said that amidst increasing economic competition in the region and the world, Vietnam should work to complete its policy and strategy so as to lure and maintain foreign direct investment from Europe.
He suggested vital areas to focus on are simplifying administrative procedures, investing in infrastructure to reduce logistics costs, and upgrading the skills of the workforce.
Along with the EVFTA, other bilateral and regional trade pacts are expected to play a key role in transforming the current economic recovery into long-term and balanced growth, he said, adding throughout this ongoing process, EuroCham Vietnam committed to playing a supportive role.
Meanwhile, Decision Lab CEO Thue Quist Thomasen said Vietnam’s long-term economic trajectory suggests a promising path of continued growth, while in the short and medium term, the country is showing its trademark ability to deliver a stable business climate even in turbulent times.
The fifth quarterly measurement within the range of 40-50 index points demonstrated the continued stability and potential improvement in 2024 will underpin the case for further FDI in the country, he added.
The outlook for Q1 of 2024 is also positive, with 29% of enterprises viewing their business prospects as “excellent” or “good” – a sign of diminishing concerns as extreme worries fell from 9% to 5%. Up to 31% of companies plan to expand their workforce in Q1, and 34% intend to increase their investments. The statistics signal a strong momentum for growth and opportunity as Vietnam begins 2024.
The quarterly BCI serves as a vital tool for understanding the perceptions of European and Europe-related companies and investors in the Vietnamese market. Since 2011, the BCI has collected feedback from EuroCham Vietnam’s extensive network of 1,400 members across a diverse range of sectors, providing valuable insights into the current business landscape in Vietnam and offering a glimpse into future expectations.
See also
Desk established in Dong Nai to support Japanese investors
09:02 | 16/05/2024 Investment
Vietnam should not miss opportunities to attract FDI
08:00 | 14/05/2024 FDI
New wave of Chinese investment
06:00 | 12/05/2024 FDI
Vietnam attractive destination for Dubai enterprises: Forum
09:04 | 11/05/2024 FDI
Vietnam ready to embrace green investment
06:00 | 11/05/2024 Investment
Japanese firm to build biomass power plant in Yen Bai
09:51 | 09/05/2024 FDI
See more news
Foreign, domestic investment in Ba Ria - Vung Tau rises sharply
09:22 | 07/05/2024 FDI
Foreign investors encouraged to invest in petroleum storage infrastructure
08:27 | 05/05/2024 Investment
Cambodian media values Vietnam's foreign investment attraction
09:50 | 03/05/2024 Investment
Thai Binh province rolls out red carpet for Dutch businesses
10:45 | 30/04/2024 FDI
Vietnam facilitates US investment
06:00 | 27/04/2024 FDI
Lao Cai province calls for more Japanese investments
08:43 | 25/04/2024 FDI
Localities get ready for fourth FDI boom
09:03 | 22/04/2024 Investment
Central Highlands provinces seek closer trade, investment ties with India
09:15 | 18/04/2024 FDI
Vietnam ready to ride US investment wave
06:27 | 15/04/2024 FDI
Government listens to partners, investors
06:00 | 13/04/2024 FDI
Hà Nội Metro announces profit from the Cát Linh–Hà Đông metro line
10:00 | 19/05/2024 Economy
Cement makers call for scraping of clinker export tax
09:00 | 19/05/2024 Economy
Tourism sector goes green for sustainable development
08:22 | 19/05/2024 Tourism
Digital transformation in logistics - a key to unlocking sustainable e-commerce and economic development
07:00 | 19/05/2024 Economy
First provincial biodiversity museum launched in Quảng Nam
06:00 | 19/05/2024 Environment
Multimedia
Việt Nam plans to preserve ethnic minorities’ intangible cultures at risk of disappearing
06:00 | 15/05/2024 Lifestyle
The Hải Phòng Red Flamboyant Festival celebrated the city's special UNESCO status
16:49 | 13/05/2024 Lifestyle
HCM City: top spot in Việt Nam for slow travel lovers
09:00 | 13/05/2024 Tourism
The Anam Cam Ranh named among Vietnam’s best family hotels
06:00 | 11/05/2024 Vietnamese Brands
Nguyễn Dynasty Urns in Huế make it to the UNESCO Memory of the World List
07:00 | 11/05/2024 Lifestyle
Tax, land rent payment deadlines to be extended this year
06:00 | 19/05/2024 Policy
Ministry proposes tax filing deadline extension for 2024
06:00 | 17/05/2024 Policy
Viet Nam targets to have 2 million enterprises by 2030
07:00 | 15/05/2024 Policy
Law on Telecommunications hoped to promote development of new telecoms services
06:00 | 13/05/2024 Policy
Energy giants plan for national power plan
06:00 | 18/05/2024 Energy
Vietnam charts vision for sustainable, modern fisheries
06:00 | 16/05/2024 Industry
Vietnam should seize opportunity to join global semiconductor supply chain
08:00 | 15/05/2024 Industry
Việt Nam's wood industry strives to match sustainable wood demands
07:00 | 14/05/2024 Industry
Desk established in Dong Nai to support Japanese investors
09:02 | 16/05/2024 Investment
Vietnam should not miss opportunities to attract FDI
08:00 | 14/05/2024 FDI
New wave of Chinese investment
06:00 | 12/05/2024 FDI
Vietnam attractive destination for Dubai enterprises: Forum
09:04 | 11/05/2024 FDI
Banks raise interest rates to attract depositors
16:47 | 17/05/2024 Finance-Banking
Credit access obstacles lifted for collective economic entities
06:00 | 16/05/2024 Finance-Banking
Government urged to narrow domestic, global gold price gap
08:36 | 15/05/2024 Finance-Banking
Biometric verification ensures safer money transfers
17:23 | 13/05/2024 Finance-Banking
First provincial biodiversity museum launched in Quảng Nam
06:00 | 19/05/2024 Environment
Enhancing informal sector’s role in EPR implementation
06:00 | 18/05/2024 Environment
Centre opened to serve environmental data integration, monitoring network operation
06:00 | 16/05/2024 Environment
Capacity building for policy makers, large emitters on ETS and carbon market
08:48 | 15/05/2024 Environment
Semiconductor investment prioritized
06:29 | 17/05/2024 Science - Technology
Full cyber stream ahead Bắc Giang focuses on digital society development
06:00 | 11/05/2024 Science - Technology
35 localities piloting four-wheel EVs for tourists, despite no official legal regulations
07:00 | 09/05/2024 Science - Technology
2024 VinFuture Prize records 1,469 nominations
06:00 | 07/05/2024 Science - Technology
HCM City to complete 183km of metro routes by 2035
06:00 | 17/05/2024 Society
Railway sector gets creative to attract passengers
07:00 | 15/05/2024 Society
Việt Nam’s largest high-speed ship service from HCM City to Côn Đảo launched
07:00 | 14/05/2024 Society
Central Highlands to become renewable energy hub
08:58 | 13/05/2024 Society
Vietnamese agricultural products to take part in Foodservice Australia 2024
15:08 | 17/05/2024 Vietnamese Brands
PV GAS launches Month of Workers
10:22 | 16/05/2024 Companies
National Brand Program promotes prestigious Vietnam
13:09 | 15/05/2024 Vietnamese Brands
Largest made-in-Vietnam bulk carrier launched
17:07 | 13/05/2024 Vietnamese Brands
Việt Nam plans to preserve ethnic minorities’ intangible cultures at risk of disappearing
06:00 | 15/05/2024 Lifestyle
The Hải Phòng Red Flamboyant Festival celebrated the city's special UNESCO status
16:49 | 13/05/2024 Lifestyle
Nguyễn Dynasty Urns in Huế make it to the UNESCO Memory of the World List
07:00 | 11/05/2024 Lifestyle
European Literary Days focuses on gender
06:00 | 09/05/2024 Lifestyle
Tourism sector goes green for sustainable development
08:22 | 19/05/2024 Tourism
Vietnamese tourism information centre opened in India
08:00 | 18/05/2024 Tourism
Mysterious 'floating' lake discovered in Quảng Bình
16:54 | 13/05/2024 Tourism
HCM City: top spot in Việt Nam for slow travel lovers
09:00 | 13/05/2024 Tourism