EuroCham members’ robust view

Many European businesses expect to hit top gear next year

The first quarterly EuroCham Business Climate Index scorecard revealed that the majority of European business in Vietnam felt positive about their future prospects in the nation.

The local business field received a rating of 75, with 100 the top score, EuroCham last week reported.

Some 62 per cent of survey respondents saw their current situation as good or neutral, while their business outlook and investment plans for 2011 were positive.

EuroCham committee member Peter Born said a vast majority of surveyed companies planned to increase their investment in Vietnam by “a little bit” (45 per cent) or “significantly” (23 per cent) or maintain their current level of investment (18 per cent). Just 2 per cent planned to reduce their investment in Vietnam in the coming year.

“These figures demonstrate that the investment in Vietnam is prospective. Recently, I welcomed many CEOs visiting Vietnam. They shared that Vietnam and Indonesia were two emerging destinations for their long-term investment vision apart from China, especially when Thailand faced some political problems affecting their investment decision making,” said EuroCham chairman Alain Cany.

When asked about their recruitment plans, most respondents indicated that they expected their workforce to remain the same (37 per cent) or rise by up to 20 per cent (31 per cent). Along with this, most companies expected the salaries for skilled and unskilled workers to rise by 5 to 10 per cent.

For the expected growth of their own business sector, respondents showed considerable optimism with majority (42 per cent) indicating that they expected their sector to grow by more than 8 per cent next year.

Moreover, most businesses (50 per cent) in the survey believed that inflation in Vietnam reached up to 10 per cent. Some 39 per cent of respondents saw inflation reaching 10 to 15 per cent in 2011.

Also, most businesses expected a 5 to 10 per cent depreciation of the local currency against the euro and US dollar.

“The goal of EuroCham when we did this survey is to get useful data for enterprises and send enterprises’ voice to the Vietnamese government,” Cany said.

Furthermore, EuroCham will publish a white book in November, with enterprises’ remarks regarding business issues and policies, to the Vietnamese government.