Slower growth fails to dim Vietnam retail market charm

TN News

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Despite slower growth last year, the Vietnamese retail market remains appealing, with many local and foreign retailers continuing to expand.

Last year the country went off the list of 30 most attractive retail markets in the world drawn up annually by management consultancy A.T Kearney.

Retail sales grew at just 16 percent -- to VND2,319 trillion (US$111.36 billion) -- compared to 20-25 percent in previous years.

Dinh Thi My La, general secretary of the Association of Vietnam Retailers, said the sector continues to have great potential since modern retailing like supermarkets and shopping malls still makes up only 20 percent of the market.

Vietnam hopes to double this number by 2020.

Sai Gon Dau Tu Tai Chinh newspaper quoted Nguyen Phuong Thao of supermarket chain Maximark as saying demand for consumer goods remains strong even when the economy is doing badly.

Half of the country's young population are thought to prefer shopping at modern stores rather than traditional markets.

Nguyen Thanh Nhan, deputy director of supermarket chain Saigon Co.op, said retail is growing "strongly" in Vietnam.

News website Saigon Times quoted him as saying that retailers are targeting the convenience store segment. His company opened 24 foodstuff outlets last year to add to its 55 existing ones and 60 supermarkets nationwide.

The Saigon Trading Group has 18 food stores, 12 of which it opened last year. The company said it would continue to expand this year.

French supermarket chain Big C opened three outlets last year to take the total number in the country to 21.

South Korean retailer Lotte Mart opened outlets in the central province of Da Nang and the southern province of Dong Nai.

Lotte also doubled its investment in Vietnam as part of plans to increase the number of outlets to 60 by 2020.

Japanese retailer Aeon has two shopping malls under construction in Ho Chi Minh City and the southern province of Binh Duong at a cost of $204 million.

Aeon plans to build a third in Hanoi in 2015.

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