Motorbike production line of Piaggio Vietnam's factory in Binh Xuyen Industrial Park, Vinh Phuc Province. (Photo: VNA) The BCI dropped below the baseline to 48.0 in Q4 2022, a drop of 14.2 pointscompared to three months ago and 25 points from the first quarter of the year.
Though Vietnam’s economy grew over 8% for the whole of 2022, this datacomes amid continued global economic volatility resulting from a storms offactors including a slowdown in global growth, interest rate hikes, sustainedinflation and bruised consumer confidence.
The number of companies expecting economic stabilisation or improvement in Q4dropped to 27% from 42% in Q3, while the number of firms with growing sense ofpessimism doubled from 19% in Q3 to 38% in Q4.
“Things were definitely less positive in the fourth quarter of 2022 than theywere earlier in the year,” said EuroCham Chairman Alain Cany.
However, according to him, this should not be viewed as a cause for concern.
“In fact, Vietnam’s economic opportunities continue to exceed those of itsregional and international peers. This is evident from the fact that so many ofEuroCham’s members consider Việt Nam central to their global investmentstrategies,” Cany said.
The report said 41% of respondents stated their company is shifting operationsfrom China to Vietnam, up from 13% in the third quarter, while nearly 35% offirms ranked Vietnam among the top five global investment destinations fortheir company, with 12% stating that Việt Nam was their firm’s top investmentsite globally.
However, the report also pointed out three most significant regulatory barriersto foreign companies operating in Vietnam, including a lack of clarityregarding rules and regulations (51%), administrative issues (41%) and visa andwork permit difficulties (30%).
Despite that, 58% were satisfied with the attention of policymakers paid tobusiness needs when setting relevant policies.
In addition, BCI participants reported that the EU-Vietnam Free Trade Agreement(EVFTA) had a positive effect on the growth of their businesses, theirfinancial health through tariff reductions and the strength of their supplychains./.
VNA
