Businesses remain optimistic amid a series of pressures

Earlier this year, Schneider Electric cooperated with Petrosetco Distribution Company (PSD) to expand the distribution of uninterruptible power protection products and services in Vietnam.

The French group cited data saying that the power storage (UPS) market in Vietnam reached a scale of more than 203 million USD last year and could increase to nearly 291 million USD by 2034 thanks to the explosion of data centers and the “green and smart” trend.

“Vietnam is in a period of strong digital transformation, leading to a rapid increase in demand for stable energy sources and smart technology infrastructure,” said Mr. Dang Nguyen Ngu, General Director of Schneider Electric Vietnam and Cambodia.

Also in the first half of the year, Saint-Gobain completed converting a factory in Quang Tri to zero emissions (Zero Carbon scope 1 and 2) after upgrading the operating system. The construction materials group from France aims to continue greening 10 other factories in the context of increasing demand for sustainable materials in Vietnam.

Not only Schneider or Saint-Gobain see the prospect of expanding investment in Vietnam. On July 15, the European Business Association in Vietnam (EuroCham) announced that the business confidence index (BCI) for the second quarter reached 79.7 points, approaching the 7-year peak reached at the end of 2025.

EuroCham President Bruno Jaspaert said the business community enters 2026 with many geopolitical unknowns. But despite the uncertainty surrounding the global economy, member businesses still achieved results that exceeded expectations.

In the improved business group, 36% of businesses recorded increased revenue and profits exceeding expectations. About 32% of units said the outlook is more positive thanks to increased orders and new contracts, and 24% said purchasing power in the domestic market has clearly recovered.

“This quarter’s results show the resilience and persistence of the Vietnamese economy and the European business community operating here,” said Mr. Bruno. According to EuroCham’s survey, 63% rated business conditions as positive in the second quarter and 69% expected further improvement in the third quarter.

Previously, research by UOB Bank (Singapore) also showed that 85% of Vietnamese businesses recorded positive business sentiment, a sharp increase compared to 48% last year. Over 90% of businesses expect operating results to improve this year.

“Vietnamese businesses are showing impressive adaptability and endurance in an increasingly volatile global environment,” said Ms. Pham Nhu Anh, Director of Wholesale Banking (UOB Vietnam Bank).

How does business confidence improve? According to the latest survey of processing and manufacturing enterprises by the Department of Statistics (Ministry of Finance), about 83.4% of units forecast good and stable performance in the third quarter compared to the second quarter. This level is higher than the previous quarter’s survey results.

According to this agency, the business community’s optimism comes from three main drivers, including investment capital flows to help expand production, export market recovery and spillover effects from public investment. Along with that, orders, output, capacity and inventory all improved.

In the first half of this year, FDI capital into Vietnam reached 34.65 billion USD, a sharp increase of 61% over the same period in 2025. Of which, realized capital flows reached more than 13 billion USD, an increase of 11.2%, the highest in the first 6 months of the year within the past 5 years.

However, the business environment still has many challenges. 53% of European businesses still perceive delays in administrative procedures, inconsistent policy implementation and tax management problems.

In addition to staff shortages, businesses also face difficulties in certification, testing and product standards. About 27% of units said the complex regulatory system is reducing competition and hindering market access.

According to EuroCham President Bruno Jaspaert, Vietnam issued more than 80 laws and amended documents in the first half of the year, marking ambitious reforms. But keeping up with the “wave of legal reform” is also a challenge for foreign businesses.

To transform trust into future mega-projects, he believes that Vietnam needs to continue to promote reform and remove institutional and procedural bottlenecks. “Clear regulations, effective administrative procedures and consistent enforcement are factors that help investors feel secure in committing capital in the long term,” he recommended.

The Statistics Department also stated that production and business still face many risks. This agency’s survey shows that up to 94.6% of businesses are under pressure from increased production costs; 47.4% rated domestic demand as low, and 28.4% had difficulty with interest rates.

The whole country had 169,800 newly established and re-operated businesses in the past 6 months, an increase of 11.2% over the same period last year (equivalent to 28,300 units per month). However, on average each month there are still nearly 25,200 businesses withdrawing from the market.

At a dialogue conference in Ho Chi Minh City on July 10, many businesses said it was still difficult to access capital even though they had export contracts and feasible business plans. The units proposed that management agencies soon have policies to support credit capital and promote trade.

Businesses are also proactively managing. UOB’s report shows that about 40% of businesses plan to expand their supplier network to strengthen the supply chain, and 80% will start applying AI. According to Ms. Pham Nhu Anh, this is a “clear transformation”.

“Businesses are stepping up investment in digital capabilities, strengthening supply chains and expanding into the ASEAN region to capture long-term growth opportunities,” she said.

Meanwhile, the Statistics Department recommends stabilizing raw material and energy prices, continuing to reduce interest rates, land rents and reforming administrative procedures as top priorities to continue improving the business environment.