EuroCham’s Business Climate Index (BCI), the leading indicator of the European business and investment community in Vietnam, was released for the fourth quarter of 2022. Thanks to Decision Lab for conducting this research.
This BCI’s key insights include the following:
- The perception of Vietnam’s business climate by European business stakeholders dropped to 48.0, down 14.2 points from Q3 and 25 points from the Q1
- Though Vietnam’s economy grew by 5.92% in Q4 year-over-year and 8.02% for the whole year, this data comes amid continued global economic volatility.
- Only 27% of respondents expect economic improvement or stabilization in Q1 2023, indicating a growing sense of pessimism. This is a 15-point drop from the last BCI.
- In the past quarter, the number of respondents anticipating an economic downturn doubled.
- 41% of respondents stated their company is shifting operations from China to Vietnam, up from 13% in Q3.
- 35% of respondents ranked Vietnam among the top five global investment destinations, and 12% stated that Vietnam was their firm’s top international investment destination.
Commenting on the BCI, EuroCham Chairman Alain Cany said:
“Things were definitely less positive in the fourth quarter of 2022 than they were earlier in the year. Although the situation is very likely to continue in this direction in 2023, this shouldn’t be viewed as a cause for concern. In fact, Vietnam’s economic opportunities continue to exceed those of its regional and international peers. This is evident from the fact that so many of EuroCham’s members consider Vietnam central to their global investment strategies.”
“It is also encouraging to see that foreign direct investment from Europe and around the world remains high and continues to grow, especially in Vietnam’s green industries and manufacturing. It is clear that, with this FDI, Vietnam’s strong economic fundamentals, and its commitment to sustainability, the country is still among the top investment destinations in the world.”