Hanoi (VNA) – Amid global geopolitical volatility and mounting pressure from international trade policies, confidence among European firms in Vietnam is showing a clear and sustained recovery.
The European Chamber of Commerce in Vietnam (EuroCham) on January 13 released its Business Confidence Index (BCI) for the fourth quarter of 2025, showing the gauge climbing to 80 points, its highest reading in seven years. The surge not only signals a strong rebound but also foreshadows a potential new wave of European capital inflows into Vietnam.
Long-term appeal
Following years dominated by external headwinds, from the COVID-19 pandemic to global supply chain disruptions, sentiment among European investors has firmly re-entered expansion mode. The survey, conducted by DXL Research & Consulting, captured a 13.5-point quarterly leap to 80 in Q4 2025, one of the steepest hikes since the index began in 2011 and exceeding pre-pandemic and pre-trade-tension levels.
The data points to a reality far more buoyant than prior cautious projections. While just 56% of companies anticipated positive conditions in Q3, 65% reported favourable outcomes in Q4. Forward-looking optimism carries into 2026, with 69% expecting continued momentum in the first quarter.
The confidence surge aligns closely with Vietnam’s impressive macroeconomic momentum. Fourth-quarter GDP growth accelerated to 8.46%, the fastest quarterly expansion since 2007, driving full-year growth to 8.02% and dispelling concerns over growth targets in the wake of new US tariff announcements.
EuroCham Chairman Bruno Jaspaert noted that factories are operating steadily, orders are recovering progressively, and investment decisions are being reactivated. Vietnam, he said, is entering a structural transition, solidifying its role as a major growth driver with aspirations to rank among ASEAN's top three economies.
Beyond short-term prospects, European companies are placing great bets on Vietnam’s medium-term prospects. The survey found 88% of respondents optimistic about 2026–2030 outlook, with nearly one-third describing themselves as “very optimistic”.
Business performance underpins the sentiment. In 2025, 60% of companies reported better results than the prior year, and 82% anticipate further gains in 2026. Vietnam's attractiveness as an investment destination remains strong, with 87% of respondents, particularly larger enterprises, saying they would recommend the country to foreign partners.
Untangling institutional bottlenecks
Still, risks remain. Global trade tensions, especially US tariff policies, continue to cast a shadow, cited as a primary concern by 46% of surveyed firms.
Xavier Depouilly, Managing Director of DXL Research and Consulting, said resilience is uneven. Large corporations are drawing on scale to pursue long-term strategies, while small and medium-sized enterprises (SMEs) face greater pressure, often favouring short-term survival over expansion.
To adapt, businesses are undertaking what the report describes as strategic “surgery”. Some 41% are focusing on cost optimisation, while 35% are accelerating adoption of technology and artificial intelligence to boost productivity.
Even as confidence climbs, administrative and regulatory obstacles persist as major headwinds. Although concerns over administrative burdens dropped 12 percentage points from the prior quarter, they still impact 53% of firms. Regulatory inconsistencies (52%) and bottlenecks in customs and visa processes continue to generate delays and inflate compliance costs.
The report credited the Vietnamese Government with meaningful progress, including the issuance of Resolution 68 in May last year and subsequent large-scale infrastructure projects. Nevertheless, policy lag remains evident, with 61% of businesses saying they are yet to see clear benefits from reforms. While 76% have adopted the VNeID digital identification system, 24% encounter difficulties and seek more flexible access and targeted support.
Looking ahead to 2026, the European business community’s message centres on policy consistency and faster execution. Over the next 12–18 months, top priorities include business expansion (50%) and workforce upskilling (45%).
Jaspaert said EuroCham remains committed to regulatory reforms that deliver tangible benefits for both SMEs and multinational players./.
