About 21 per cent of Indian companies that have operations in Southeast Asia or expect to do so in the future also have plans to expand their business in Vietnam in the next two years, according to the HSBC Navigator survey.
The survey covers more than 1,500 companies from six of the largest economies in the world, including China, France, Germany, India, the UK and the US – all of which have operations in Southeast Asia. The survey gauges their sentiment on doing business in Southeast Asia, with a particular focus on trade, digitalisation, and sustainability.
On the advantages side, three out of 10 surveyed companies found Vietnam’s skilled workforce to be the most attractive feature of the market, while 27 per cent of respondents were attracted by the country’s optimistic economic outlook, competitive wage prices, and the resilience demonstrated by Vietnam during the pandemic.
It is worth noting that 39 per cent of Indian companies favoured the market thanks to developed infrastructure and 49 per cent favoured Vietnam's supportive government and regulatory environment. About 36 per cent of US companies were very attracted by the opportunity Vietnam affords to test and develop new products and solutions.
In parallel, up to 49 per cent of the survey’s participants, especially those from China, India, and the US, intend on taking advantage of the many free trade agreements Vietnam has signed.
Vietnam is also a regional leader in its progress towards achieving the 17 UN Sustainable Development Goals (SDG). Ranked 51 of 162 countries in the SDG Index, it is thus rated as having greater success than all other Southeast Asian countries barring Thailand.
About 45 per cent of companies operating in Vietnam stated that the most important sustainability actions they could take were improving energy efficiency; a further 42 per cent underlined the importance of supporting local communities.
Some 31 per cent of respondent companies operating in Vietnam worried that new regulations and rules on carbon reduction could impact them. It is therefore unsurprising that in order to achieve their sustainability goals, three in 10 of those international firms pointed to a need for further improvement in their internal sustainability expertise, while 36 per cent flagged the difficulty of hiring employees who possessed the correct sustainability capability.