Viet Nam’s global investment appeal remains strong: EuroCham

A notable 63 percent of surveyed businesses positioned Viet Nam within their top 10 foreign direct investment (FDI) destinations.

Around 31 percent ranked Viet Nam among their top three, while an impressive 16 percent hailed it as their foremost investment destination. Reflecting this confidence, over half of those surveyed plan to increase their FDI in Viet Nam by the end of the year.

Sustainability in Viet Nam: high priority, high hurdles

The BCI nudged up to 45.1 in the third quarter of 2023, from 43.5 the previous quarter. While still below the 50-point threshold for four straight quarters, this small rise indicates emerging positive economic momentum.

Business sentiment appears to be in flux. Between Q2 and Q3, there was a three percentage point drop in pessimism regarding the current situation, while positive and neutral perspectives increased by six and four percentage points respectively.

Compared to responses in the survey the second quarter, there was an 11 percentage point rise in businesses anticipating economic stabilization and growth for the upcoming quarter. On the other hand, businesses projecting a negative trend reduced by five percentage points.

Sustainability is rising as a priority for European companies in Viet Nam, with 80 percent citing environmental, social, and corporate governance (ESG) alignment as highly or moderately important. 

Additionally, only 20 percent of firms are proactively preparing for impending EU green regulations, such as the Carbon Border Adjustment Mechanism. 

EVFTA's dual impact: opportunities and obstacles

More than two years after its implementation, the EU-Viet Nam Free Trade Agreement (EVFTA) is continuing to have a strong positive impact on Viet Nam's business landscape. 

Over 60 percent of companies called the deal beneficial, citing tariff cuts as the top perk, followed by improved competitiveness in Viet Nam, reduced trade barriers, expanded partnerships with local firms, and increased access to the Vietnamese market. 

EuroCham Chairman Gabor Fluit commented, nearly one-third of  EuroCham's members ranking Viet Nam as a top-three investment location sends a powerful message about the faith in this partnership.

Seeing that 80 percent of EuroCham's members prioritize ESG alignment underscores a genuine commitment to responsible growth among businesses, he said.  

"By integrating green practices into business strategies, we pursue both development and progress," underlined Gabor Fluit./.