Hanoi (VNA) - Vietnam’s Business Confidence Index (BCI) reached its highest level in over two years, rising to 61.8% in the fourth quarter of 2024 from 46.3% in the same period of 2023, according to the latest report from the European Chamber of Commerce in Vietnam (EuroCham).
Bruno Jaspaert, Chairman of EuroCham Vietnam told the Vietnam News Agency in a recent interview that Vietnam continued to stand out as a highly attractive destination for foreign investors, including those from Europe. This was proven by the EuroCham’s Q4 2024 report, which shows that 75% of surveyed business leaders consider Vietnam an ideal choice for investment projects.
“This signals an improving business climate,” Jaspaert said.
Key factors driving this sentiment include favourable policies such as tax incentives, support for large-scale investors, promotion of small-and medium-sized enterprises (SMEs) in industrial zones, and investment in workforce training, according to the EuroCham Chairman.
He added Vietnam also offered exceptional cost-effectiveness, with land and energy cost approximately 25% lower than in China, alongside a competitive and abundant workforce, although addressing skill gaps remained essential.
Additionally, Vietnam’s government is among the most investor-supportive globally, offering accessible and swift actions. These factors combined have solidified Vietnam’s position as a promising and strategic hub for European investment.
Despite these notable strengths, he suggested Vietnam improve several areas: “Specifically, establishing a clear and consistent legal framework is crucial, as some regulations remain ambiguous or inconsistent, posing challenges for company establishment and access to renewable energy”.
Another area of concern was the complexity of customs procedures with cumbersome paperwork that complicated large-scale import-export activities.
The Chairman of EuroCham Vietnam pointed out overlapping responsibilities among various government agencies could hinder efficiency for business and investment operation.
To address these challenges, Jaspaert recommended Vietnam to focus on streamlining regulations, improving administrative procedures clarity, and enhancing customs efficiency, as well as leveraging ministerial overhauls and deepening collaboration with European partners to unlock potential.
Sharing his perspectives on Vietnam’s economic opportunities and challenges in the coming time, Jaspaert said Vietnam has demonstrated impressive economic resilience, achieving GDP growth of over 7% in 2024, surpassing expectations despite global challenges and natural disasters, particularly Typhoon Yagi - the strongest storm to hit Vietnam in three decades.
Vietnam has also been actively promoting global integration through the EU-Vietnam Free Trade Agreement (EVFTA) and foreign direct investment (FDI) policies, opening avenues for market expansion and innovation. In addition, sustainability and digital transformation are increasingly seen as Vietnam’s key areas for long-term and inclusive growth.
However, challenges facing Vietnam remain on the horizon.
“Inflationary pressures, supply chain disruptions, and geopolitical uncertainties pose significant risks to economic stability. Regulatory challenges and administrative hurdles, as highlighted in the EuroCham Business Confidence Index (BCI), continue to complicate business operations and hinder efficiency,” Jaspaert warned.
He recommended Vietnam to enhance regulatory transparency, foster structural reform, and embrace green and digital innovation for long-term and sustainable development.
The country should also balance ambitious growth goals with environmental and social inclusivity, he added./.
