The Hanoitimes - Expanding consumption market for Vietnamese goods is a solution to promote the commerce and services growth and increase the Gross Regional Domestic Product (GRDP) by 8.5 – 9% in accordance to Plan no. 31 – KH/TU of the Hanoi Party Committee.
Retail sale increases slowly
The statistics provided by the Department of Industry and Trade on the first six months in 2017 shows that the total retail sale in Hanoi increases by only 7.1%, the lowest increase in the last 5 years (the increase in 2012 was 18,3%, in 2013: 13,5%, in 2014: 12,2%, in 2015: 11,5%, and in 2016: 8,8%).
The constant decrease of retailing demonstrates a lack of focus on developing the retailing system. According to the Department of Industry and Trade, even though fields such as restaurants, tourism, education, health services, etc. make up approximately 50% of retailing, but this contribution has not been relative to the growth of total retail sales. In particular, in 2013, a 13.5% increase contributed 6.4% to the growth, in 2014 5.8% and 12.2%, in 2015, 5.5% and 12.5%, and in 2016, 3.4% and 8.8% respectively.
Meanwhile, although the growth of retailing has been on a decreasing trend since 2011, its contribution to general growth is increasing (the increase of 18.3% contributed 8% to the general growth in 2012, in 2013: 7.1% and 13.5%, in 2014: 6.4% and 12.2%, in 2015: 6% and 11.5%, and in 2016: 5.4% and 8.8% respectively).
In order to expand consumption, retailing enterprises have initiated many promotions and discounts campaigns. However, the consumption growth has not increased as expected. The economic expert Vu Vinh Phu, former Deputy Director of the Hanoi Trade Department, says that the reasons for the decrease in consumption is due the income of the citizens which has not improved so the people’s consumption habit remains unchanged. Specifically farming activities have not been profitable, farmers income decreases leading to low the consumption demand.
Create opportunities for enterprises to promote consumption
In order to promote consumption in the rest of of the year, the Hanoi People’s Committee proposed plan No. 145/KH-UBND to organize a program to keep the prices of necessities in Hanoi in 2017 stable.
To proceed with this plan, from now on until the end of 2017, Hanoi Department of Industry and Trade will expand new consumption market for the Vietnamese products through activities such as exhibitions and promotion months, etc. This is an opportunity for enterprises to advertise their promotion and discount programs. At the same time, the Department and the State Bank of Vietnam will jointly organize the banking sector-enterprises connection program for businesses to access loans and develop their businesses.
“These programs have contributed to the increase of total retail sale in the last few months, however the Department of Industry and Trade alone cannot bring the GRDP of Hanoi to grow from 8,5% to 9% as planned. It requires consistent solutions from related agencies in the City to push forward development in other sectors such as hotel-restaurant, tourism, PR, administration procedures, healthcare, and so on”. The Vice Director of Hanoi Department of Industry and Trade Tran Thi Phuong Lan pointed out.
Besides the support from Hanoi agencies, enterprises must be active in expanding their consumption markets, diversifying products, lowering input material price and application of IT, etc. to meet the consumer demands.
“Production and consumption stimulation requires the City agencies to review and adopt appropriate policies to support enterprises in accessing credit . It is also important to consider reducing the value – added tax for essential products”said Economic expert Ngo Tri Long.
(Le Nam - Kinhtedothi.vn)