EuroCham: Viet Nam’s rising star in global investment

Confidence among European businesses operating in Vietnam is showing signs of resilience.

While this uptick signals gradual stabilization, it’s vital to highlight that the BCI has remained below the midpoint since Q4 2022.

An impressive 62 percent of those surveyed ranked Viet Nam among their top ten global investment destinations, with 17 percent placing it at the very top.

This strong endorsement is matched by 53 percent of respondents anticipating increased foreign direct investment in Viet Nam by the end of Q4.

As Viet Nam’s business landscape transitioned from Q3 to Q4 2023, subtle yet telling shifts in sentiment emerged. While there was a slight 2 percentage point dip in overall optimism for economic stability and growth, this was more than offset by a drop of 14 percentage points in expectations of an economic downturn.

The last quarter of 2023 saw a marked increase in satisfaction among businesses: firms confident in their current situation rose from 24 percent in Q3 to 32 percent in Q4. The outlook for Q1 2024 is also positive, with 29 percent of businesses viewing their prospects as ‘excellent’ or ‘good’ – a sign of diminishing concerns, as extreme worries fell from 9 percent to 5 percent.

Looking ahead, Viet Nam’s business sector is poised for growth. 31 percent of companies plan to expand their workforce in Q1 2024, and 34 percent intend to increase their investments, a clear uptick from 2023. These statistics signal a strong momentum for growth and opportunity as Viet Nam begins 2024.

EuroCham Chairman Gabor Fluit commented on this development, saying, ‘There’s definitely a positive trend underway. While we still have a long way to go for a full recovery, businesses are feeling more hopeful.”

He added, ‘The European business community is increasingly optimistic that the most challenging economic period is now behind us.'”