European businesses in Vietnam are optimistic about 2021
The latest EuroCham Business Climate Index (BCI) recorded its highest level since the outbreak of the pandemic.
The European Chamber of Commerce in Vietnam (EuroCham) has just announced the BCI results for the fourth quarter of 2020 with a high result of 63.6 points, up 6 points compared to the previous quarter. In total, this index has increased by 37 points since last year, after recording a record low score in the first quarter of 2020, with the first outbreak of Covid-19.
BCI is a quarterly measure used by EuroCham members to assessbusiness environment. Field survey and data collection for BCI conducted by YouGov Vietnam. An index above 50 reflects positive sentiment.
BCI developments from 2010 to 2020.Graphics: EuroCham.
One-third of EuroCham members expect their headcount to increase in the next quarter, and 57% expect it to remain the same. Meanwhile, 30% of survey respondents expect investment to increase and 43% expect orders and revenue to grow.
With the EVFTA now in effect, 70% said their businesses have benefited. However, 33% also said that “administrative procedures” will be the main challenge for businesses to optimize the Agreement.
EuroCham Chairman Nicolas Audier said the latest BCI information is a positive picture of Vietnam's business environment and the outlook for 2021. "The business community's confidence in the economy has been increasingly strengthened over the past year, a testament to the Vietnamese government's successful handling of the pandemic and cooperation to promoteEVFTA, creating a foundation for Vietnam's socio-economic growth in the next 5 years," he commented.
According to Mr. Thue Quist Thomasen, Managing Director of YouGov Vietnam, European businesses have increasing confidence in Vietnam's trade and investment environment, in contrast to the situation elsewhere in the world.
Specifically, when asked aboutVietnam economic outlookIn Q1 2021, 57% of EuroCham members surveyed expected the “stability and improvement” to continue. Compared to 39% in Q3 2020, confidence in the economic outlook has increased. “Our data shows that confidence in Vietnam’s economic growth potential is gaining momentum across the board,” said Thue Quist Thomasen.
