EuroCham downgrades Vietnam’s business outlook for three straight quarters

Results of the quarterly survey on Business Index conducted by the European Chamber of Commerce in Vietnam (Eurocham) recently show that the business environment index of European enterprises in Vietnam in the fourth quarter (Q4) has fallen 11 points against Q3, from 63 points to 52 points.
According to Alain Cany, Chairman of EuroCham, the survey showed that the business confidence and outlook in the European business community in Vietnam continues to decline. Most scores are on average about 50 points.

The number of surveyed enterprises saying “good” declined from 46% in Q3 to 32% in Q4, while this ratio in Q1 was 64%. Notably, there were no comments indicating the “excellent” business situation. The number of businesses having a negative view on the current situation rose from 16% to 22%.

When asked about the business outlook in the upcoming time, only 27% stated “good”, much lower than 72% in Q1. Meanwhile, another 27% of businesses surveyed had a negative outlook, slightly up against 20% in the previous quarter.

Only 38% of enterprises want to maintain their investment and only 36% are looking to increase their investments in Vietnam, falling considerably from 52% in Q3.

Up to 48% of asked businesses said that inflation will have significant impacts on their business activities, lower than 56% in previous quarter.

Regarding Vietnam’s macro economic prospects in the next six months, two third of surveyed businesses answered that they would see a further decline of difficult economic situation.

The survey was conducted with over 200 companies from Europe, of which, nearly half of participants specialize in of service industry sector, one third in manufacturing sector and the rest in trade and other sectors. – Source: Vietbiz24.com

Tags: Vietnam business outlook

Posted by VBN on Oct 23 2011. Filed under Economy News. You can follow any responses to this entry through the RSS 2.0. You can leave a response or trackback to this entry