Vietnam SMEs are world’s 2nd most confident
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Small- and medium-sized enterprises in Vietnam are the world’s second most confident in terms of local economic growth in the next six months, according to a bi-annual HSBC Small Business Confidence Monitor released Thursday.
Their confidence index stays at 156, second only to Saudi Arabia in the world, and over the global average of 125, according to the Hong Kong and Shanghai Banking Corporation.
Though dropping 8 points in comparison to the last survey, the index is in line with the economic outlook of 60 percent of the polled SMEs in Vietnam who believe that the economy will continue to grow during the period.
Over half of the surveyed enterprises are involved in international business, which is much higher than the average global figure of 29 percent.
These enterprises are mainly conducting import and export services, marketing their products/services through international subsidiaries or offices, and off-shoring services, e.g. call centers, service centers.
Forty two percent of the Vietnam SMEs have plans to expand their existing international activities while nine percent want to continue their current international operations.
About one fifth have plans to go international while the rest of almost one third does not.
Asked about the intention of doing business internationally in the next two years, 82 percent of the international companies believe that they will expand their business, which is double compared to the global figure.
Only 37 percent of the domestic enterprises have plans to do business internationally.
Availability of financing and concerns about dealing in foreign currencies remain at the top of barriers for Vietnamese SMEs’ doing international business.
These businesses are also concerned about the complexity of certain international markets, foreign currency controls, local regulations and legal complexities, lack of knowledge, contacts, and experience of overseas markets.
The top three concerns for the next six months are inflation, economic conditions and difficulties in accessing credit. This is also in line with the latest result from the HSBC Emerging Market Index survey.
The survey results also highlight that government policy measures such as monetary policy and stimulus packages play a key role for local economic growth.
This latest HSBC Small Business Confidence Monitor gauges the six-month outlook of over 6,300 SMEs across 21 markets in Asia, Africa, Middle East, Europe, North America and Latin America on local economic growth, capital investment plans and recruitment drives.
