European enterprises in Vietnam hit hard by COVID-19

The global COVID-19 pandemic has had a significant, negative impact on European business in Vietnam, according to the latest Business Climate Index (BCI) from the European Chamber of Commerce (EuroCham).

The Business Climate Index reached the lowest point to date in the first quarter of 2020.

BCI is a regular barometer of how European business leaders see the trade and investment environment in Viet Nam and the prospects of their own enterprises.

Following similar trends around the world, where the impacts of COVID-19 have hit international trade and investment, the EuroCham BCI plunged to its lowest-ever score of 26 per cent in the first quarter of 2020. That represents a fall of 51 points from the 77 per cent recorded in late 2019.

Over 90 per cent of business leaders said that COVID-19 has had a negative impact on their enterprise, with more than half reporting a ‘significant’ negative impact. Meanwhile, almost 80 per cent said that their business had incurred higher costs from measures taken to protect their workers and prevent the spread of the virus.

Despite the negative financial impact of COVID-19, European companies are taking important measures to protect both the health and the livelihoods of their workforce. About 80 per cent business leaders are confident that they will be able to retain at least 70 per cent of their staff over the next quarter. Meanwhile, 80 per cent have asked their staff to work from home to prevent the spread of the virus.

EuroCham members also welcomed Government measures introduced in Directive 11 to support businesses during the pandemic. A deferral of tax and land rent was the most popular provision, with a suspension of social insurance contributions coming a close second.

The chamber also asked European business leaders what other measures would be most helpful for their enterprises, and around three-quarters said a deferral of other taxes such as corporate income tax, personal income tax, value-added tax and special consumption tax would be the most welcome support for their companies.

 

EuroCham Chairman Nicolas Audier said this data shows that COVID-19 is having a deep and serious impact on European business in Viet Nam.

“However, it is important to remember that this is a global pandemic, and enterprises around the world are suffering from the impacts of this crisis. There is also no doubt that, without the swift and decisive actions of the Government, the situation here could have been much worse. For this reason, our members welcome the measures announced so far, which will provide a lifeline to companies and their workers during this difficult time,” Nicolas Audier said.

He said COVID-19 is a fast-moving health crisis, and it is creating unprecedented challenges for businesses of all shapes and sizes and in all sectors and industries. Therefore, further actions could soon be required to help both domestic and foreign enterprises weather this storm and get back to business as usual as soon as possible.

“EuroCham is committed to Viet Nam’s long-term economic growth, and our members remain available to share their insights and recommendations to help minimise the disruption of COVID-19 on business operations and – above all – to protect the health and wellbeing of people in Viet Nam,” he added. — VNS

EVFTA paves way for European investors to contribute capital to Vietnam’s banks

EVFTA paves way for European investors to contribute capital to Vietnam’s banks

Within five years from the day the FTA takes effect, Vietnam pledges to consider European credit institutions’ proposals to allow them to hold up to 49 percent of shares in two Vietnamese joint stock banks.

EVFTA, EVIPA unleash market potential for European firms

EVFTA, EVIPA unleash market potential for European firms

The EU-Vietnam Free Trade Agreement and the EU-Vietnam Investment Protection Agreement offer significant business opportunities for European enterprises, German Federal Minister for Economic Affairs and Energy Peter Altmaier said.

 
 

Other News

.
VN tra fish companies see profits slump in pandemic
VN tra fish companies see profits slump in pandemic
BUSINESSicon  05/08/2020 

Multiple tra fish companies suffered losses due to falling export prices and lower orders, focusing instead on the domestic market amid the COVID-19 pandemic.

EVFTA hoped to help with sustainable poverty reduction in Vietnam
EVFTA hoped to help with sustainable poverty reduction in Vietnam
BUSINESSicon  05/08/2020 

The EU-Vietnam Free Trade Agreement (EVFTA), which came into force on August 1, is hoped to create a driving force to help Vietnam reap further achievements in poverty reduction and economic growth.

Analysts: High-end hotels hold appeal among investors
Analysts: High-end hotels hold appeal among investors
BUSINESSicon  05/08/2020 

Analysts from real estate consultant Jones Lang LaSalle have said domestic and foreign investors alike are actively seeking to purchase high-end hotels in downtown areas, mostly due to limited land supply.

Wooden plank exporters struggle with higher tax rates
Wooden plank exporters struggle with higher tax rates
BUSINESSicon  04/08/2020 

The Vietnam Timber and Forest Product Association has sent an urgent petition to the Ministry of Finance, Ministry of Agriculture and Rural Development and Ministry of Industry and Trade about congestion of wooden planks

E-wallet firms battle for slice of cashless payment pie
E-wallet firms battle for slice of cashless payment pie
BUSINESSicon  04/08/2020 

E-wallets firms are battling for a piece of the cashless payment market amid rapid growth in the context of the COVID-19 pandemic.

Corporate income tax reduction comes into effect
Corporate income tax reduction comes into effect
BUSINESSicon  04/08/2020 

Resolution 116/2020/QH14 granting a reduction of 30 per cent on corporate income tax (CIT) for eligible enterprises officially came into effect on Monday.

Big rearers win big
Big rearers win big
BUSINESSicon  04/08/2020 

Many animal husbandry enterprises are leveraging the pork supply shortage to sell at high prices, earning huge profits

VN businesses slow in preparing to enjoy preferential tariffs in EVFTA
VN businesses slow in preparing to enjoy preferential tariffs in EVFTA
BUSINESSicon  04/08/2020 

 Experts have raised concerns that Vietnamese businesses are slow in preparing conditions to enjoy preferential tariffs in the Viet Nam-EU Free Trade Agreement (EVFTA).

Probe into Tenma Vietnam’s alleged bribery underway: police official
Probe into Tenma Vietnam’s alleged bribery underway: police official
BUSINESSicon  04/08/2020 

The investigation into the Japanese-invested Tenma Vietnam company’s allegation of bribing civil servants and tax and customs officers of northern Bac Ninh province is still ongoing, according to a police official.

VN textile, electronics hardest hit in pandemic: official
VN textile, electronics hardest hit in pandemic: official
BUSINESSicon  04/08/2020 

Textile and electronics have been the two export-oriented sectors mostly impacted by the COVID-19 pandemic, an official has said.

Vietnam’s small companies look to the US market
Vietnam’s small companies look to the US market
BUSINESSicon  05/08/2020 

The US is an important export market targeted not only by large Vietnamese corporations but also small enterprises.

How can VN night-time economy develop?
How can VN night-time economy develop?
BUSINESSicon  05/08/2020 

Food and Music of An Bang Sea, a night event organized on An Bang Beach in Hoi An City in Quang Nam province last weekend, attracted many visitors.

Local F&B shops struggle to survive new COVID-19 outbreak
Local F&B shops struggle to survive new COVID-19 outbreak
BUSINESSicon  05/08/2020 

Eatery and beverage shops learned from experiences from the April lockdown and have prepared for the new difficult period.

Businesses in HCM City's central business districts are idle as demand is weak
Businesses in HCM City's central business districts are idle as demand is weak
BUSINESSicon  05/08/2020 

Many streetfront buildings in large cities that house shops that were busy in the past are idle because business activities have declined due to Covid-19.

Vietnam prepares to receive investors from Japan, the US, EU
Vietnam prepares to receive investors from Japan, the US, EU
BUSINESSicon  04/08/2020 

Japanese businesses have begun relocating factories to Vietnam, and it is expected that American and European businesses will also come soon.

VN Civil Aviation Authority's plans for new Quang Tri Airport face opposition
VN Civil Aviation Authority's plans for new Quang Tri Airport face opposition
BUSINESSicon  04/08/2020 

The Civil Aviation Authority of Vietnam (CAAV) plans to build Quang Tri Airport in Quang Tri province, but experts disagree with the idea.

Vietnam factory activity dips in July as Covid-19 impacts grow
Vietnam factory activity dips in July as Covid-19 impacts grow
BUSINESSicon  03/08/2020 

Despite a drop in output in July, firms remained confident in the 12-month outlook for production.

Enticing legal changes lure in foreign investors
Enticing legal changes lure in foreign investors
BUSINESSicon  04/08/2020 

Foreign investors are making new investments moves into Vietnam on the back of supporting policies and new rules. However, as some legal concerns remain, the development of the next steps still requires some preparation. 

Summary of new points of amended Law on Investment 2020
Summary of new points of amended Law on Investment 2020
BUSINESSicon  03/08/2020 

After more than six years in effect, the Law on Investment has been officially amended with a number of new articles to improve the country’s appeal to higher-quality foreign investment flows.

Outlining the preferential mechanisms for new PPP projects
Outlining the preferential mechanisms for new PPP projects
BUSINESSicon  04/08/2020 

Public-private investment projects play a significant role in developing infrastructure and have the potential to accelerate large-scale construction works across the country.

 
 
 
Leave your comment on an article

OR QUICK LOGIN