The Business Climate Index reached the lowest point to date in the first quarter of 2020. (Source: VNA)Hanoi (VNA) – European enterprises in Vietnam welcomed the Vietnamese Government’s measures introduced in Directive 11 to supportbusinesses during the COVID-19 pandemic, according to the latest Business Climate Index(BCI) from the European Chamber of Commerce (EuroCham).
Accordingly, thedeferral of tax and land rent was the most popular provision, with asuspension of social insurance contributions coming a close second.
About 75 percentof respondents said the deferral of many taxes such as corporate incometax, personal income tax, VAT and special consumption tax is very helpful forbusinesses.
The BCIindicated that the global COVID-19 pandemic has had a significant,negative impact on European business in Vietnam.
Following similartrends around the world, the EuroCham BCI plunged to its lowest-ever score of 26percent in the first quarter of 2020. That represents a fall of 51 points fromthe 77 percent recorded in late 2019.
Over 90 percent ofbusiness leaders said that COVID-19 has had a negative impact on theirenterprise, with more than half reporting a ‘significant’ negative impact.Meanwhile, almost 80 percent said that their business had incurred higher costsfrom measures taken to protect their workers and prevent the spread of thevirus.
Despite thenegative financial impact of COVID-19, European companies are taking importantmeasures to protect both the health and the livelihoods of their workforce.About 80 percent of business leadersare confident that they will be able to retain at least 70 percent of theirstaff over the next quarter. Meanwhile, 80 percent have asked their staff towork from home to prevent the spread of the virus.
EuroCham ChairmanNicolas Audier said this data shows that COVID-19 is having a deep and seriousimpact on European business in Vietnam.
“However, it isimportant to remember that this is a global pandemic, and enterprises aroundthe world are suffering from the impacts of this crisis. There is also no doubtthat, without the swift and decisive actions of the Government, the situationhere could have been much worse. For this reason, our members welcome themeasures announced so far, which will provide a lifeline to companies and theirworkers during this difficult time,” Nicolas Audier said.
He said COVID-19 isa fast-moving health crisis, and it is creating unprecedented challenges forbusinesses of all shapes and sizes and in all sectors and industries.Therefore, further actions could soon be required to help both domestic andforeign enterprises weather this storm and get back to business as usual assoon as possible.
“EuroCham iscommitted to Vietnam’s long-termeconomic growth, and our members remain available to share their insights andrecommendations to help minimise the disruption of COVID-19 on businessoperations and – above all – to protect the health and wellbeing of people inVietnam,” he added.
The BCI is a regular barometer of how European businessleaders see the trade and investment environment in Vietnam and the prospects of theirown enterprises./.
VNA
