Defying global supply chain volatility and shifting trade dynamics, European business confidence in Vietnam has surged to 79.7 points in Q2 2026. Marking the 15-year anniversary of EuroCham's flagship Business Confidence Index (BCI), the Q2 2026 report reveals a renewed surge in European business confidence, underscoring Vietnam's resilience amid one of the most volatile global operating environments in recent years.  

With a sharp 7-point climb from the 72.7 points recorded in Q1, this quarter’s index is just a fraction below the historic seven-year peak of 80.0 reached in late 2025. The momentum signals a renewed appetite among European investors for expansion in one of Southeast Asia's fastest-growing economies, reaffirming the long-term confidence that briefly receded amid heightened global uncertainty. 

"This quarter's findings demonstrate the incredible, almost tenacious resilience of both Vietnam's economy and the European businesses operating here," noted EuroCham Chairman Bruno Jaspaert. “The first half of 2026 has been a rollercoaster. We entered the year with complex geopolitical wild cards, yet, despite a heavy cloud of global uncertainty, our member companies outperformed their own expectations. This index proves that when the weather gets rough, our ecosystem knows how to recalibrate and capture growth." 

Conducted in partnership with DXL Research and Consulting, this edition provides one of EuroCham's most comprehensive assessments yet of how European businesses are responding to an increasingly complex global and localenvironment. Beyond measuring business sentiments, the BCI examines the impact of geopolitical tensions, evolving trade dynamics, administrative reform and intellectual property protection.  

Stronger performance drive optimistic outlooks 

The survey shows that 63% of European businesses reported positive business conditions during Q2, while optimism continues to strengthen, with 69% expecting favourable conditions in the coming quarter. This wave of optimism represents an 11-percentage-point jump compared to the expectations expressed just three months ago, driven by surging commercial performance, a healthy influx of new orders, and resilient domestic demand. 

Xavier Depouilly, General Manager of DXL Research and Consulting commented: “Confidence has recovered across all sectors, confirming that the slowdown recorded in Q1 was broad-based but ultimately temporary. While the pace of recovery has varied by industry, the overall direction is consistent. Agrifood recorded a more modest 5.5-point improvement, whereas Tourism & Hospitality surged by 8.7 points to reach 90.4, well above the overall index. Across industries, businesses have outperformed their own expectations, supported by resilient domestic and international demand, expanded public and private investment, and a remarkable ability to adapt to an increasingly complex environment. By introducing sector and company size level analysis, the BCI report and dashboard now provide a more granular understanding of business sentiment, helping both investors and policymakers identify where confidence is strengthening, where challenges remain, and where targeted actions can have the greatest impact.” 

The data highlights clear commercial drivers behind this optimism. Among the firms reporting improved performance this quarter, 36% pointed to rising revenues, stronger sales velocities, and enhanced operational profitability that consistently outpaced internal forecasts. Meanwhile, 32% credited their brighter outlook to expanding order books and major new contract wins, while 24% emphasised a noticeable strengthening in domestic consumer demand. This balanced growth across manufacturing, tourism, real estate, and export-oriented sectors shows that Vietnam’s economic engine is accelerating on multiple cylinders.  

"These BCI results mirror the broader macroeconomic landscape as Vietnam solidifies its position as one of Asia's growth champions," Chairman Jaspaert explained. "In the first half of 2026 alone, the national GDP expanded by an impressive 8.18%. When you pair that breakneck growth with Vietnam's rise to 27th in the IMD World Competitiveness Ranking and its upcoming FTSE Russell upgrade to a Secondary Emerging Market this September, the narrative is crystal clear. What makes Vietnam truly stand out in a fiercely competitive regional landscape is a government that does not just talk about growth, but formalises it into national resolutions and actively executes structural reforms to pursue it." 

Throughout 2026, the Government has accelerated institutional reforms, administrative restructuring and investment policies aimed at attracting higher-quality foreign direct investment. Chief among these is the recent rollout of Resolution 10, which shifts the country's FDI criteria away from cheap labour and raw volume toward high-tech innovation, technology and sustainable growth. 

EuroCham has remained an active partner throughout this legislative evolution. During the chamber’s flagship Whitebook Dialogue Week in Ha Noi in May 2026, EuroCham's leadership engaged directly with Vietnamese Government, the Ministries, State Bank, and National Assembly to advance practical solutions across diverse sectors. This continuous public-private feedback loop ensures that the operational insights of European business are woven into the fabric of Vietnam's next economic chapter. 

Administrative reform as the ultimate key for investment 

However, this wave of optimism comes with an operational caveat: strong internal performance cannot offset a burdensome regulatory framework. If Vietnam wants to convert today's positive sentiment into tomorrow's megaprojects, it must tackle its administrative bottlenecks head-on.  

Despite rising confidence, 53% of businesses consistently ranked regulatory delays, policy inconsistencies, and opaque tax administration not merely as minor daily annoyances, but as the primary anchors dragging down their long-term expansion plans. While these longstanding challenges remain firmly at the top of the business agenda, new pressures are also emerging. Talent shortages have continued to rise since Q4 2025, now cited by 38% of businesses and ranking among the three most pressing operational challenges. Meanwhile, technical and product standards have emerged as a growing source of operational complexity, reflecting the growing sophistication of Vietnam's economy. 

The impact extends well beyond regulatory compliance. One-third of businesses reported that administrative procedures slow operational execution and project delivery, while 29% said they divert resources away from core business activities. A further 27% believe regulatory complexity reduces competitiveness and limits market access.  

Many respondents described spending an escalating amount of management time dealing with multi-layered licensing, repetitive approvals, and redundant documentation. This administrative burden acts as a stealth tax on innovation, limiting a firm's ability to reinvest capital into local R&D or facility expansions. Furthermore, businesses frequently pointed to the inconsistent implementation of central decrees across different authorities, unpredictable regulatory evolutions, and prolonged VAT refund procedures as persistent sources of financial uncertainty that tie up vital working capital. 

Intellectual property protection also remains an important consideration for businesses. Among respondents with registered intellectual property or trademarks in Vietnam, 32% reported experiencing at least one registration or enforcement challenge, most commonly weak dispute resolution mechanisms (28%) and delays in administrative procedures (18%), both of which can give foreign investors pause when looking to localise proprietary advanced technologies. 

As a response, the Government has introduced several important reforms during 2026 to strengthen Vietnam's intellectual property framework and intensify enforcement against counterfeiting and trademark infringement. While businesses broadly welcome these measures, many noted that it remains too early to assess their practical impact, highlighting the importance of effective implementation alongside legislative reform. 

Taken together, the findings point to a consistent message from the European business community: Vietnam's economic fundamentals remain highly attractive, but administrative reform now represents the single greatest opportunity to strengthen competitiveness further.  

"As our businesses become more sophisticated, they require an equally sophisticated regulatory environment," Chairman Jaspaert analysed. "Predictable regulations, efficient administration, and uniform enforcement are what keep investment capital secure. The 80+ new and amended laws introduced this year alone mark the beginning of an intensive growth era. For foreign firms, keeping pace with this “tsunami of regulatory reform” is a full-time compliance challenge. EuroCham’s role is to serve as the steady bridge connecting on-the-ground business insights with policymakers, ensuring these reforms can be translated into businesses' confidence to anchor here for the long term." 

Global uncertainty is changing strategy, not confidence 

A closer look at the data reveals that while global macroeconomic disruptions remain widespread, they are shifting corporate strategies rather than dampening long-term investor confidence. Recent international trade standoffs and geopolitical tensions have undoubtedly placed broad operational pressure on businesses. Nearly half (46%) of all surveyed executives reported a distinct negative impact on their broader international operations, while a third described a mixed impact split across different facets of their business. This suggests that while external shocks are unavoidable, their consequences are far from uniform, varying depending on a company's size, sector, and supply chain exposure. 

Interestingly, mid-sized companies appear to be the most vulnerable to these international headwinds, consistently reporting the highest levels of negative operational impact. Lacking the massive capital cushions of multinational conglomerates or the ultra-local agility of small enterprises, these mid-tier firms bear the brunt of rising compliance and logistics costs. Meanwhile, the larger multinational corporations reported zero positive spillover effects, indicating that their extensive international exposure often acts as a double-edged sword, offsetting some of the traditional resilience typically unlocked by corporate scale. 

For most businesses, the impact has been operational rather than existential. Higher freight, shipping and logistics costs were identified as the most significant consequence of global uncertainty, cited by 78% of affected businesses, closely followed by higher energy and fuel costs (76%). Many also experienced logistics disruptions, delivery delays and softer customer confidence, increasing pressure on both costs and planning. 

Rather than waiting out the storm, businesses have responded by making their supply chains more resilient. Among companies affected by logistics disruptions, 53% reported extending supply chain buffer times, including 25% adding more than two weeks to transit schedules. The need for longer buffer times was especially pronounced among businesses trading with the United States and the European Union, highlighting the additional complexity facing companies operating across long-distance trade routes. 

Yet, where there is disruption, there is also competitive displacement. Some businesses quickly identified new opportunities arising from global supply chain shifts. Several respondents reported increased production orders and investment flows as manufacturers diversified operations towards Vietnam, reinforcing the country's growing role as a regional manufacturing and sourcing hub. 

Concurrently, trade itself is also becoming more complex. More than half of internationally active businesses reported that geopolitical developments have made compliance with Rules of Origin (RoO) requirements more challenging. While many described these challenges as manageable, almost one-third experienced moderate to significant difficulties. The primary pain points center on securing secondary documentation from foreign suppliers, proving manufacturing transformations to customs officials, and tracking compliance across highly fragmented sourcing networks. 

Financial pressures remain widespread. Two-thirds of businesses reported a negative impact on their bottom line. Among these, around half experienced relatively modest losses of less than 10%, while 4% reported losses exceeding 30%. At the same time, 14% of businesses benefitted from this shifting global landscape, with most recording gains of up to 10% and another 2% achieved net gains exceeding 30%. Companies with stronger integration into EU - Vietnam trade generally proved more resilient, suggesting that diversified trade relationships and long-term market integration continue to provide an important buffer against external shocks.   

From confidence to competitiveness 

The Q2 2026 Business Confidence Index sends a clear message: European businesses continue to see Vietnam as one of Asia's most promising investment destinations. 

More than half of the respondents (54%) now describe Vietnam as a core strategic market and operational base, while a further 18% consider it a major growth location. Together, these findings reflect a notable shift in how European companies position Vietnam within their regional and global business strategies. Rather than serving solely as a manufacturing base, Vietnam is increasingly seen as a platform for production, sourcing, regional services and future expansion across Southeast Asia. 

As Vietnam pursues its bold double-digit growth, businesses see a significant opportunity to translate today's strong business sentiment into sustained, high-quality investment by accelerating administrative reform, improving regulatory predictability and ensuring consistent implementation across all levels of government. Continued progress in these areas would enable businesses to devote more resources to innovation, production and workforce development, further enhancing Vietnam's competitiveness as a destination for international investment. 

"The confidence radiating from this quarter's index is encouraging, but confidence alone is not the destination," Chairman Jaspaert concluded. "Over the last fifteen years, the BCI has evolved from a simple quarterly sentiment poll into a comprehensive economic indicator, giving our Government partners the evidence needed to optimise the investment climate. By continuing this constructive loop, we accompany Vietnam’s rise to become Asia's premier destination for high-quality, sustainable, and future-proof investment."