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European businesses have no intention to leave Vietnam: EuroCham

  • Sep 10, 2021

European businesses still hold high hopes for Vietnam’s prospects.

The current Covid-19 outbreak and restriction measures have forced 18% of orders from European firms in Vietnam to move to others countries, 16% are considering doing so, but no one is looking to leave the country.

Chairman of the European Chamber of Commerce in Vietnam (EuroCham) Alain Cany gave the remarks at a press conference held today [September 9], shortly after the conclusion of the meeting between the European business community in Vietnam with Prime Minister Pham Minh Chinh.

“There is no disguising the fact that this fourth wave outbreak is having a dire impact on business. The EuroCham Business Climate Index is now recording the lowest sentiment in more than a decade. If lockdowns, social distancing, and travel restrictions continue for much longer, new investment projects could be put at risk and companies could consider relocating elsewhere in the region,” Cany warned.

The EuroCham Chairman, nevertheless, stressed European businesses hold high hopes for Vietnam’s prospects, which has been only strengthened by the strong commitment and support that the Vietnamese Government has shown in today’s meeting.

Cany also noted what EuroCham members need at the moment is a clear roadmap out of these current measures; one which resolves the roadblocks to their commercial operations and gives them a predictable path on which to plan the reopening of their businesses.
 Electronics production at Kefico Vietnam Company in Thang Long Industrial Park, Hanoi. Photo:Hai Linh

One of the most pressing issues is the need for electronic vaccination passports to ease the free movement of vaccinated people both within and into Vietnam. In particular, we urge the government to create a fast-track process for foreign business leaders, experts, and their families returning to Vietnam,” he continued.

Meanwhile, the current ‘Three-in-One’ policies need to be refined. While the principle is sound, it places a huge burden on both companies and their workers in practice, Cany said.

France’s Ambassador to Vietnam Nicolas Warnery noted the current legislation on working permits for foreign experts is causing difficulties for companies.

European businesses expected more open policies for foreigners fully vaccinated before entering Vietnam, said Warnery.

On the same day, the Vietnamese Government issued a resolution aimed at providing support for businesses affected by the pandemic, which also include easing measures for the issuance of work permits for foreigners in Vietnam. The move is expected to address concerns for foreign experts.

EuroCham Chairman Cany informed to date, Vietnam has received 10 million doses of vaccines from the EU via COVAX Facility, with another three million sets to come from European countries in the coming time.

Vietnam continues to be major piece in global supply chains: Int’l experts

Even when the supply chains and economy are impacted by the Covid-19 pandemic, Vietnam’s economic continues to perform positively, and day by day is becoming a more important piece of global supply chains, especially for products and goods that are affecting US consumers.

The American Chamber of Commerce in Hanoi’s Executive Director Adam Sitkoff made the comment in Bloomberg on the country’s economic prospect amid current Covid-19 outbreak.

Sitkoff mentioned the fact that Vietnam has been one of the world’s fastest-growing economies for years, and was the fastest one in Asia last year with a GDP growth of 2.9%.

While it is no doubt that the Covid-19 pandemic is slowing down Vietnam’s growing presence in the global supply chain, the country remains an attractive investment destination, he noted.

Sagarika Chandra, associate director of Asia-Pacific sovereign ratings at Fitch Ratings told The Hanoi Times the current covid-19 outbreak and restrictions to control the spread of the disease will weigh on activity in the third quarter of 2021, but “some of the lost growth momentum may be made up in subsequent quarters as the economy recovers.”

“The key factors driving Vietnam’s rating of ‘BB’ with a Positive Outlook are its strong medium-term growth prospects which are also supported by persistent strong foreign direct investment inflows and strengthening external finances. We think, these rating drivers still remain in place and continue to support the rating and outlook at the existing level, despite the current outbreak,” Sagarika asserted.

Since the Covid-19 pandemic first emerged in 2020, Vietnam is the only country in the world having its outlook upgraded to “positive” by three major rating agencies of Moody’s, Standard and Poor’s (S&P), and Fitch Ratings.

Source: http://hanoitimes.vn/european-businesses-have-no-intention-to-leave-vietnam-eurocham-318662.html