On July 15, the European Chamber of Commerce in Vietnam (EuroCham) released the Business Confidence Index (BCI) report for the second quarter of 2024, showing that the index decreased slightly to 51.3 and the business community expects Vietnam to continue promoting policies to maintain growth.
According to Mr. Dominik Meichle, Chairman of EuroCham Vietnam, Vietnam’s economic potential is undeniable and the European business community remains confident in Vietnam’s long-term growth. Although the BCI survey points out areas for improvement, EuroCham believes that promoting cooperation to address administrative and regulatory barriers will create a more efficient and attractive business environment, benefiting both the European and Vietnamese business communities.
Typically, to attract more FDI and stimulate economic growth, surveyed enterprises highlighted five factors that Vietnam can improve its business environment, including: streamlining administrative processes and procedures, increasing clarity in laws, etc. In addition, Vietnam should promote the development of core infrastructure, simplify visa procedures and work permits for foreign experts, etc.
While 68% of respondents said current conditions were moderate to positive, short-term caution has increased slightly and this needs to be addressed for the positive trend to continue, said Thue Quist Thomasen, CEO of Decision Lab (which conducted the BCI survey). However, strong GDP growth of 6.42% in the first half of 2024 and nearly 70% expressing optimism in the long term reinforce the strong belief that positive indicators can materialize in the future.
The BCI survey also shows that a nuanced picture of the business landscape, such as progress towards carbon neutrality, is key to attracting quality FDI from Europe. On a positive note, the signing of the Direct Power Purchase Agreement (DPPA) provides hope for accelerated implementation and could address some of the challenges by improving access to clean energy and encouraging better sustainability.
The Business Confidence Index (BCI), produced quarterly by Decision Lab, serves as an important tool to understand the views of European companies and investors in the Vietnamese market. The BCI has been conducted since 2011, collecting feedback from EuroCham Vietnam’s network of 1,400 members across various sectors and conducting surveys to provide valuable insights into the current business landscape in Vietnam, as well as providing a view of future expectations.
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