Vietnam ranks 7th in global business optimism index

Vietnam saw a leap in business optimism in the first quarter of 2011 with an increase of 18 percent to 80 percent, becoming the 7th country with the highest optimism in the global ranking list, according to a recent report.

The latest International Business Report (IBR) launched by Grant Thornton Vietnam in March showed in Q1 2011, developed economies had the optimism in business against other rivals in emerging markets.

Emerging economies such as Latin America continued to maintain the highest optimism on the economic prospect with Chile ranks first, followed by the Philippines, Sweden, India, Argentina and United Arab Emirates.

From Q4 2010 to Q1 2011, G7 economies showed a rapid step with the rise of 16 percent while the optimism in Latin America countries decreased 4 percent and that of the BRIC group (Brazil, Russia, India and China) increased slightly 3 percent.

Totally, the global confidence index gained the 34 percent rise in Q1 2011.

Confidence has increased significantly over the past quarter in G7 economies. This mirrors what we have seen in financial markets as mature economies are being viewed more favorably since the turn of the year,” Ken Atkinson, managing partner of Grant Thornton Vietnam said.

“A global recovery without the US is difficult to envisage, so it is encouraging that growth and a fall in unemployment appear to be giving cause for greater optimism. This should give cheer to emerging as well as mature economies,” he added

“Vietnam experienced a large jump in confidence this quarter, but other emerging economies like Brazil and Russia are seeing appreciating currencies making exports more expensive, so much so that Brazil has called for fundamental reform to international currency systems,” said Alan Dy, audit partner of Grant Thornton Vietnam.

“Inflation and interest rates have also increased, which are usually attributable to falls in optimism about the economic outlook,” he added.

Skills shortage threatens emerging markets

The survey, conducted amongst over 5,700 privately held businesses across 39 economies, reveals that 43 percent of Vietnamese businesses believe a lack of availability of skilled labor will constrain their ability to grow this year, representing a 10 percentage point upswing from the previous quarter.

BRIC and Latin America shares the same concern, with 42 percent and 43 percent of businesses respectively citing a lack of skilled labor as a constraint, an increase of 17 and 20 percentage points.

Half of privately owned businesses in India (51 percent) and Brazil (49 percent) stress that a lack of availability of skilled labor will constrain their ability to grow this year. The problem is also a major issue for businesses in mainland China (40 percent), Thailand (46 percent) and South Africa (37 percent). – Tuoitre

Tags: International Business Report