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Firms preparing for opening of retail market
Vietnam’s move to fully open its retail market as of January 2009, pursuant to the WTO’s commitments will create an attractive business environment and stimulate enterprises to develop their business, according to a local official.
Deputy Minister of Industry and Trade Nguyen Thanh Bien told a seminar in Hanoi on Oct. 13 that Vietnam ’s accession to the World Trade Organisation (WTO) has brought both opportunities and challenges, including difficulties posed by the opening of the retail market that is attracting the special interest of a number of foreign investors.
To turn the challenges ahead into opportunities for development, the deputy minister suggested that local retailers improve their competitiveness and formulate suitable long-term business strategies as well as tightening their management methods and structures.
Bien urged retailers to focus their investment on the establishment of modern distribution systems, developing human resources and, in particular advancing the expertise of their managers.
Distribution and retail services have played an increasingly important role in Vietnam ’s economy in recent years, making up more than 15 percent of the country’s annual gross domestic product (GDP), he stressed.
Vietnam is currently considered the most attractive investment destination for retailers among the developing countries, Bien said, noting that total retail revenue is estimated to hit 975 trillion VND (59 billion USD) this year, a year-on-year increase of 20.5 percent.
Under its WTO commitments, Vietnam will permit the establishment of 100 percent foreign-owned distribution and retail businesses. Even though the country does not officially open its retail market until early 2009, both local and foreign retailers have been eager to invest.
A number of world-leading retail giants such as Metro Cash & Carry, Casino and Parkson are planning to expand their operations into Vietnam, where the retail market is forecast to experience a boom as from 2009.
VNA
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