European businesses see negative outlook as restrictions hurt

By Dat Nguyen   September 10, 2021 | 03:47 am PT
European businesses see negative outlook as restrictions hurt
Cat Lai Terminal in Ho Chi Minh City. Photo by VnExpress/Quynh Tran
Seventy six percent of European companies in Vietnam have recorded a negative outlook in the third quarter this year due to negative impacts caused by the fourth Covid-19 wave.

Looking ahead in the next quarter, 71 percent of European business leaders anticipate challenges, according to a survey of 193 respondents by the European Chamber of Commerce in Vietnam (EuroCham).

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.

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 lockdown restrictions that gravely affect the manufacturing sector, 18 percent have already shifted some production to other countries and 16 percent are considering their options.

European businesses also said 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.

In terms of inoculation, 56 percent of companies have had a majority of their staff vaccinated with at least one shot.

EuroCham chairman Alain Cany said Thursday if social distancing and mobility restrictions continue, "new investment projects could be put at risk and companies could consider relocating elsewhere in the region."

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