Half of businesses anticipate lower 2020 revenues

A quarter of respondents said damage could be over 20 percent of revenue, according to a survey by Infocus Mekong Research, a Ho Chi Minh City-based market research company.

Last year’s top concern - environmental pollution - was replaced by the coronavirus outbreak this year, according to 67 percent of respondents, consisting of 242 business leaders nationwide across various sectors.

Fifty five percent said the overall economy would worsen this year due to the virus, a figure three times more than the 18 percent recorded last year.

Only one in five businesses expect economic prospects this year to be better than in 2019.

"I have been living in Vietnam for over 26 years and have never seen such a huge plummet in overall confidence, not even during the 2010-2011 real estate bubble burst," said Ralf Matthaes, managing director of Infocus Mekong Research.

Some businesses have reported dwindling figures. Stephen Wyatt, country head of real estate firm Jones Lang LaSalle (JLL) Vietnam, said businesses in the hospitality sector have seen trading down between 20-50 percent from before the outbreak.

"Early indications suggest the sectors of hospitality, retail, food and beverage, manufacturing and logistics are among the hardest hit."

Fred Burke, partner of law firm Baker & McKenzie Vietnam, said 2020 will see challenges for many businesses that may not be strong enough to withstand the shocks to the supply chain.

"Manufacturing for export is starting to feel the pain as imported components from China are getting held up in China's shut down," he said.

But the short-term impacts will be followed by speedy recover, industry insiders anticipate.

Andy Ho, chief investment officer of asset management company VinaCapital, said when China finally contains the outbreak, Vietnam’s capital markets would recover and could surpass levels seen last year.

Recent surveys of American and German businesses in Vietnam have shown a majority of companies expect damage from the coronavirus in 2020.

Fitch Solutions has lowered its growth forecast for Vietnam from 6.8 percent to 6.3 percent this year because of the epidemic.