Positive Results for European Chamber’s Vietnam Business Climate Index (BCI)

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365Hanoi – The European Chamber of Commerce (EuroCham) in Vietnam has announced the results of the 18th Business Climate Index (BCI) survey, revealing the current and expected future business environment among European businesses operating in Vietnam.

The 18th quarterly EuroCham BCI survey conducted in April 2015 showed confidence in Vietnam’s business climate remaining high at 75 index points out of 100 for the first quarter of 2015, down slightly from 78 in the previous quarter. Participants in the survey mostly came from the services, trading and manufacturing industries.

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Overall, 45 percent of businesses participating in the survey perceived Vietnam’s current business climate as “good”, down from 52 percent in the last quarter. Those perceiving the climate as “neutral” was recorded at 31 percent, with “very poor” and “excellent” on 11 percent each.

The majority of 57 percent expect future business conditions to be “positive”, a five percent drop from last quarter. 30 percent of respondents perceived the outlook as neutral, up from 28 percent last quarter. The remaining respondents were divided equally between “excellent” and “poor” outlooks.

Vietnam’s macroeconomic outlook was perceived by 63 percent in the first quarter as heading for “stabilization and improvement”, up from 59 percent last quarter. A shift from 20 percent to 25 percent of respondents was recorded that the outlook is “not to change”. A dramatic decline from 21 percent to 12 percent predicted “deterioration of the macroeconomic conditions”.

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The participants expected a slight decrease in inflation from 5.78 percent to 5.25 percent over the next six months. A slight inflation impact on business situation was reported in 65 percent respondents. While 17 percent feared a significant impact, seven percent believed inflation would have no impact on their business, and only one percent were afraid it would threaten their business.

View of the new enterprise law and investment laws were mixed among the respondents. Three equal groups at 21 percent each recorded that they believed the changes to beneficial, that the changes would have no impact, and that the businesses was uninformed about the changes. Another 20 percent said that they were informed about the changes but did not know the details of the regulations. The remaining nine and six percent believed that the changes would be not beneficial at all, and that the new regulations will be obstructive to their businesses respectively.

For advice on how the new enterprise and investment laws will affect your business in Vietnam, get in touch with Dezan Shira & Associates Vietnam at: hcmc@dezshira.com


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