HANOI: The Business Climate Index, a barometer of the business sentiment among European companies operating in Vietnam, rose slightly in the fourth quarter of 2014, according to the European Chamber of Commerce.
Eurocham said in a report that the rise is driven by optimistic views in regards to both the current business situation and the business outlook for the future.
In the fourth quarter, the index increased from 74 to 78. That is very close to the record high of 79 set at the beginning 2011.
The rise is believed to be driven by a wide perception of favorable macroeconomic conditions. It also mirrors a high expectancy, held by European investors, on the ongoing negotiations of the EU-Vietnam Free Trade Agreement, according to Eurocham.
Fifty-two percent of polled businesses now perceive their business situation as “good”, and 5 percent of participants report “excellent” conditions.
Thirty-three percent of respondents report a “neutral” business situation.
Positive outlook
There is a small increase in the percentage reporting “poor condition” from 8 percent to 10 percent, but on the other hand none of the participants report “very poor” conditions.
According to the new report, the greater majority of respondents perceive their business outlook as “positive”, with 62 percent of the respondents expecting “good” business conditions.
Another 28 percent of respondents perceive the outlook of doing business in Vietnam as either neutral or without change.
As for the macroeconomic outlook for Vietnam, 59 percent have predicted “stabilization and improvement”, a slight drop from last quarter’s 61 percent.
Respondents expecting the situation “not to change” also shifted slightly from 24 percent to 20 percent.
There was a rise in the number of respondents that expect “deterioration of the macroeconomic conditions”, from 15 percent to 21 percent.
