Business Confidence Index report of The European Chamber of Commerce in Vietnam (EuroCham) shows that confidence in economic growth is steadily increasing among the European business community in Vietnam. The index is the highest since 2022.
European firms in Vietnam are optimistic about the Vietnamese economy in both the short and long term: one-third feel positive about the outlook for the second quarter, while more than half expect orders and revenues to increase in the second quarter of 2024. Furthermore, the increased willingness of firms to invest is evidenced by a decrease in the number of firms planning to cut expenses in the coming quarter.
In the long run, EuroCham reports that this optimism is even stronger, with 71% of firms having a positive outlook on their long-term prospects in Vietnam over the next five years.
In terms of confidence in investment, 54% of respondents said they would be likely to recommend Vietnam to other foreign firms. According to EuroCham, Vietnam's ability to attract foreign investment stems from its highly skilled labor force.
Despite the optimism, barriers still exist, including administrative burdens, unclear regulations, difficulties in obtaining licenses, and work permit issues.
Therefore, in order to attract more foreign investment in the long run, European companies in Vietnam cite several important reforms, such as simplifying procedures, strengthening the legal framework, and improving infrastructure to facilitate market entry.
