European businesses: Putting trust in the Vietnamese market

The results of the Business Climate Index (BCI) survey by the European Chamber of Commerce in Vietnam (EuroCham) show that the level of confidence of European enterprises in the Vietnamese market remains stable. Reporters of the Industry and Trade Newspaper had an interview with Mr. Preben Hjortlund - Chairman of EuroCham - about this issue.

Could you tell us the results of the 12th BCI survey conducted by EuroCham in the third quarter of 2013 in Vietnam?

The BCI results in the third quarter did not decrease, showing that the confidence of European enterprises in Vietnam has not decreased. However, Vietnam is facing a number of problems with bad debt and inefficient operations of the state-owned enterprise sector, creating barriers to GDP growth. Therefore, it is difficult for Vietnam to create a breakthrough change in the short term. In addition, Vietnam's investment environment is competing with a number of emerging markets in attracting investment in the ASEAN region such as Indonesia, Myanmar, etc.

In the long term, Vietnam's economic prospects are expected to continue to improve, with positive responses increasing to 51% in the third quarter compared to 43% in the second quarter and 30% in the first quarter of 2013. This is evidence that European businesses are still committed to long-term operations in Vietnam, hoping for an improvement in the business environment from the results of the Vietnam Trade Policy Review at the WTO in September 2013 and confidence in the EU-Vietnam Free Trade Agreement in the future.

It is known that 1/5 of the responding enterprises have considered moving their business to other ASEAN markets. What should Vietnam do to improve its competitiveness with those markets, sir?
ASEAN is a very important development region for many European businesses. ASEAN is aiming to complete the construction of a unified community by 2015. In my opinion, Vietnam should have a clear message showing that European businesses are always welcome in Vietnam and are ready to listen to and work with the business community to resolve difficult issues.

Up to 80% of European businesses responded that they have not considered moving their business to another market. In your opinion, what is the great attraction of Vietnam's investment environment?

It is worth noting that in recent times, the Vietnamese Government has carried out reforms to improve the business environment in a number of areas. In addition, Vietnam has the advantage of abundant human resources, so it has become an attractive market for investors. This is similar to Korea or some EU countries during the population boom period...

We hope that Vietnam and the EU will soon have a comprehensive Free Trade Agreement, at which time the Government will resolve the issues that the business community is concerned about, and investment capital from Europe to Vietnam will increase in both quantity and quality. European businesses will increasingly value Vietnam's position in ASEAN.

Thank you!

According to baocongthuong-PH