Why most of European businesses in Vietnam records a negative outlook?
ChandraGarran04 13-09-2021, 09:11

Due to negative impacts caused by the fourth Covid-19 wave, seventy six percent of European companies in Vietnam have recorded a negative outlook in the third quarter this year.

A survey by the European Chamber of Commerce in Vietnam (EuroCham) showed, 71 percent of 193 European business leaders anticipate challenges in the next quarter.

The Business Climate Index, which measures business leaders’ sentiment quarterly, fell to the lowest in over a decade of tracking at 15.2 over 100 points, data showed.

Related: Businesses facing lack of human resources when reopening

Seventy percent of business leaders cited the main challenge they were facing as transport and logistics difficulties caused by social distancing.

Over half, 51 percent, said market conditions in Vietnam was another roadblock.

Other reasons included limited mobility of sales forces and inconsistent policies between provinces.

Due to extended social distancing measures that gravely affect the manufacturing sector, 18 percent have already shifted some production to other countries and 16 percent are considering their options.

The stay-at-work model does not prove to be effective long-term as workers want to go home and that it is too costly, according to European businesses.

Regarding to the inoculation, 56 percent of companies have had a majority of their staff vaccinated with at least one shot.

“If social distancing and mobility restrictions continue, “new investment projects could be put at risk and companies could consider relocating elsewhere in the region.” EuroCham chairman Alain Cany said on Thursday, according to a report by VNExpress.

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