Retail industry worries about being "inferior" in the ASEAN Economic Community

Many domestic retail businesses are worried about being "outdone" by competitive pressure when the ASEAN Economic Community is established.

Joining the ASEAN Economic Community (AEC) will open up many new prospects for Vietnam in terms of investment, trade, employment, etc. However, along with new opportunities are challenges in terms of competitive pressure or lack of initiative of businesses in this playing field.

One of the sectors facing the greatest competition when the ASEAN Economic Community is established is the retail sector. Many people are concerned that with a 0% tax rate, a flood of foreign goods will put Vietnamese goods at a disadvantage.

Domestic businesses launch many promotional programs to attract customers.

According to the General Statistics Office, in 2015, the total retail sales of goods and consumer service revenue is estimated to reach more than 320 trillion VND, an increase of 9.5% compared to 2014. Vietnam is currently in the top 5 most developed retail markets in Asia. After more than 5 years of joining the WTO and moving towards deep integration with the ASEAN region and the world with a series of recently signed Free Trade Agreements, it shows that Vietnamese retail businesses are gradually transforming, adapting to the new context, and improving their competitiveness to survive.

Many forecasts say that by 2020, Vietnam's middle class will triple in size, with a young population structure and an increasing number of people visiting shopping malls, making it the most potential customer group for retail businesses.

Economist Nguyen Mai commented that currently the domestic market has 90 million people, by 2020, Vietnam will have 100 million people, with about 15, 20% being middle class (average income of about 10,000 USD/person). Obviously, there will be a very large and attractive domestic market, not only for domestic enterprises but also for foreign enterprises.

Despite the potential, the modern retail market share in Vietnam only accounts for about 25% of total retail sales, of which there are more than 20 foreign enterprises operating in Vietnam. According to statistics from the Ministry of Industry and Trade, among imported goods consumed in the Vietnamese market, goods originating from Thailand are ranked second, after China.

Currently, Thai-made garments and household appliances are available in nearly 8,600 markets nationwide and have an advantage over imported products from other countries, with the advantage of diverse types, rich designs and competitive prices.

According to VOV