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Vietnam remains top-five EU global investment site

HANOI: The confidence of European enterprises in Vietnam’s economy declined for a second quarter, but the S-shaped country still remains in the top-five global investment destinations for their companies, the latest Business Climate Index (BCI) published by the European Chamber of Commerce in Vietnam (EuroCham) shows.

The BCI dropped below the baseline to 48 in the fourth quarter 2022 (4Q22), a drop of 14.2 points compared 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 data comes amid continued global economic volatility resulting from a storm of factors, including a slowdown in global growth, interest rate hikes, sustained inflation and bruised consumer confidence.

The number of companies expecting economic stabilisation or improvement in 4Q22 dropped to 27% from 42% in 3Q22, while the number of firms with a growing sense of pessimism doubled from 19% in 3Q22 to 38% in 4Q22.

“Things were definitely less positive in 4Q22 than they were 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 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,” Cany said.

The report said 41% of respondents said their company was shifting operations from China to Vietnam, up from 13% in 3Q22, and 58% were satisfied with the attention of policymakers on business. — Viet Nam News/ANN

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