EuroCham: European enterprises confident in Vietnam's long-term economic growth

DNHN - Nearly 70% of businesses express confidence in Vietnam's economic growth over the next five years, with many companies ready to recommend Vietnam as an investment destination.

On July 15, the European Chamber of Commerce in Vietnam (EuroCham) released the Business Confidence Index (BCI) for Q2 2024. Despite strong GDP growth in the first half of the year, the BCI for this quarter slightly decreased to 51.3 points, compared to 52.8 points in Q1 2024. This survey, conducted with 1,400 EuroCham members, reflects the varied sentiments of European businesses operating in Vietnam.

The survey shows that 68% of businesses hold a neutral to positive view of the current business conditions, indicating general stability. Although there is cautious optimism about Vietnam's economic outlook for Q3 2024, with 45% of businesses expressing this sentiment, there remains a portion of businesses that are hesitant about their prospects, with 45% maintaining a neutral stance and 23% expressing concerns.

However, this short-term anxiety is balanced by strong confidence in the long-term outlook. Nearly 70% of businesses believe in Vietnam's economic growth over the next five years, with many willing to recommend Vietnam as an investment destination.

To attract more foreign direct investment (FDI) and boost economic growth, the surveyed businesses identified five key areas for improvement in Vietnam's business environment: (1) streamlining administrative processes and procedures; (2) enhancing legal clarity to reduce misinterpretations; (3) developing core infrastructure such as roads, ports, and bridges; (4) simplifying visa and work permit procedures for foreign experts; and (5) ensuring political stability and security.

Mr. Dominik Meichle, Chairman of EuroCham Vietnam, affirmed that Vietnam's economic potential is significant and that the European business community remains confident in Vietnam's long-term growth. He emphasized that, despite areas needing improvement, by collaborating to address administrative and regulatory barriers, a more efficient and attractive business environment can be created, benefiting both the European business community and Vietnam.

Thue Quist Thomasen, CEO of Decision Lab, agreed that the survey results paint a nuanced picture of the business landscape. While 68% of businesses rate current conditions as average to positive, increased short-term caution needs to be addressed for the positive trend to continue.

Despite short-term concerns, strong GDP growth at 6.42% in the first half of 2024 and the long-term optimism of nearly 70% of businesses suggest confidence that these positive indicators can become reality in the future.

P.V