European businesses upbeat about Viet Nam’s green growth prospect

The finding is part of the Business Climate Index (BCI) released Monday by the European Chamber of Commerce in Viet Nam (EuroCham) and conducted by YouGov Viet Nam.

Positive views were expressed about Viet Nam's prospects for green growth as well. Regarding the link between green growth and foreign direct investment (FDI), nearly 90 percent of respondents believed Viet Nam should increase green sector development to attract more foreign investment.

During the second quarter of 2022, European business stakeholders' confidence in Viet Nam's investment environment declined slightly. 

Following a first-quarter rise, the BCI dropped 4.4 points in the second quarter to 68.8 points. 

Although the BCI has fallen, it remains 7.6 points higher than in the fourth quarter of 2021, when it measured 61.0 points.

According to the findings, 45 percent of respondents were significantly or moderately satisfied with Viet Nam's efforts to attract and retain FDI, while 76 percent expected their company to increase FDI to Viet Nam before the end of the third quarter. 

This may be due to the fact that 55 percent of respondents said Viet Nam improved its FDI attraction and retention capabilities since the first quarter.

Furthermore, the survey identified barriers to European investment in Viet Nam and trade between the two sides. 

35 percent of respondents cited reducing administrative barriers as the most effective way to increase FDI, while 24 percent pointed to infrastructure development. 

Green growth is way of future

With this BCI, Viet Nam's path to improving its investment and business environment is clearly outlined, noted EuroCham Chairman Alain Cany. 

Green growth is the way of the future, not just because it will help build a prosperous foundation for Viet Nam's economy and people, but also because it will support the country's transformation into one of the world's strongest markets, he added. 

Prime Minister Pham Minh Chinh's COP26 commitments and the Government's National Green Growth Strategy show that the Government is serious about making the changes necessary for a green transition.

"Therefore, despite the global economic uncertainty, it is an incredibly exciting and promising time to do business in this country", emphasized Alain Cany.

To better understand the Vietnamese market, EuroCham invites its more than 1,200 members, representing virtually every sector of the Vietnamese economy, to provide quarterly updates on Viet Nam's business environment and forecasts for their own businesses in Viet Nam. 

The BCI is the leading indicator of the European business and investment community in Viet Nam.