VietNamNet Bridge – A national survey conducted by the Vietnam Chamber of Commerce and Industry has revealed growing business confidence for the new year.

Local entrepreneurs’ business sentiment is getting better.

The Vietnam Business Insight Survey (VBiS) of 700 firms across the country registered a plus seven point index for 2014, a gigantic leap from minus 21 points for 2013, revealing a dramatic leap in confidence among the business community.

According to VBiS results, 42.5 per cent of the surveyed businesses said they would expand their business in 2014, 50.7 per cent would maintain their current size while just 6.7 per cent would reduce the size of operations. Only a miniscule 0.1 per cent was preparing to halt operations.

Businesses claimed they would expand operations due to a favourable economic outlook (40.1 per cent), the availability of low-cost skilled labour (40.1 per cent), tax incentives (29.6 per cent) and greater market openness (28.2 per cent).

“Companies expect greater changes in the labour market as they believe they will be able to recruit good quality local labour for even important positions for the first time,” said VCCI representative Doan Thi Quyen.

VBiS also showed up to 44.3 per cent of the surveyed businesses suggested the government boost the development of support industries to help them in raising the added values of their products.

The survey also pointed to the fact that 65.2 per cent of businesses said they were interested in taking bank loans, compared to 57.3 per cent in 2012.

“Demand for bank loans has tended to increase, which is a positive indicator for the economy,” Quyen said.

In 2012, up to 74.9 per cent of businesses took a bank loan at an annual interest rate of 12 per cent or more, while the number of such firms declined dramatically this year, to 32.7 per cent.

When questioned on the efficiency of the government’s solutions to ease the difficulties facing businesses, 60 per cent of respondents rated the efficiency of the policies as medium, while 40 per cent said it was at a low level.

Source: VIR