However, the percentage of respondents rating the business situation as excellent dropped by nearly 10 per cent, with an increase of 7 per cent of respondents describing the situation as good. Negative responses were at almost the same level as Q4 in 2017.

More respondents showed confidence in a stable and improving macro-economic environment in Viet Nam with a 9 per cent increase, while those expecting no change in the next quarter increased by nearly 10 per cent.

The survey showed that inflation was not a major concern for EuroCham members, with 84 per cent believing it would have either no or a minor impact.

Regarding headcount, the number of businesses expecting to maintain the current size of their workforce remained at 40 per cent, while 12 per cent planned to significantly increase their workforce. Responses indicating an intention to reduce headcount accounted for 5 per cent compared to 10 per cent in the previous quarter.

Meanwhile, 45 per cent of respondents said they intended to maintain their level of investment, a 9 per cent rise.

EuroCham Co-Chairman Nicolas Audier said that the BCI survey results for Q1, 2018 continued to show positive expectations from EuroCham members toward Viet Nam, albeit not at the same levels of optimism as in 2016.

“EuroCham hopes that this interest inspires the Vietnamese Government to improve the business environment further, particularly regarding the changes to the legal framework that will enable Viet Nam to fulfil its commitments under the EU-Viet Nam Free Trade Agreement, expected to come into force later this year,” he said.

Audier noted that even though the BCI score was very positive (78 out of 100), there was still some legal and regulatory work to do. He added that EuroCham was confident that current hurdles to liberalisation would be surpassed and the next survey would again reflect an excellent outlook from the perspective of the European and Europe-related business community in Viet Nam.