Excluding the price increase factor, the total retail sales of goods and services in the first six months of this year only rose by 5.7%. Overall, the average annual growth of total retail sales of goods and services during the 2021-2023 period was only around 7.2%.
Since 2021, domestic market purchasing power has shown a slow upward trend at various points, negatively impacting the contribution of domestic trade to the growth of the trade-service sector and the country's overall GDP. According to economic experts, the domestic market is considered one of the pillars of the economy. As such, stimulating domestic consumption will be a key driver to boost economic growth.
Following the Prime Minister's directive on implementing domestic consumption stimulus programmes, boosting domestic consumption, and supporting economic growth, the Ministry of Industry and Trade is urgently assessing the current situation and forecasting market trends. The ministry is also gathering proposals and recommendations from the industry associations, distribution networks, and other stakeholders to promptly implement practical, specific, and effective solutions aimed at stimulating domestic consumption and promoting domestic trade.
According to the draft project of “stimulating domestic consumption and promoting domestic trade" prepared by the Ministry of Industry and Trade, in order to stimulate consumption and gradually revive the domestic market from now until the end of 2024 and in the following years, it is necessary to research and propose programmes such as issuing shopping vouchers, offering discounts, clearing inventory, and selling price-stabilised goods, including goods for the Lunar New Year (Tet).
Additionally, the relevant authorities are researching and proposing credit programmes and consumer loans with low and preferential interest rates. According to distribution companies, promotional programmes should not be prolonged or spread out; instead, they should be focused and impactful to strongly attract consumers.
In the long term, the government needs to improve the legal framework, policies, and the investment-business environment, along with administrative reforms, and enhance the effectiveness of law enforcement related to domestic trade development. A focus should be placed on reducing input costs and unofficial costs for businesses and citizens. Emphasis should be placed on developing the retail infrastructure system and facilitating the formation of enterprises that act as hubs for purchasing goods in localities, especially in areas with strengths in One Commune, One Product (OCOP) products. There should also be encouragement for investment in the development of logistics services, transportation and storage, and payment services.
Furthermore, the government should carry out solutions to enhance the competitiveness of Vietnamese retail enterprises as well as diversify economic entities and types of businesses participating in retail market development. Effective management of trade and consumer protection is also needed, along with solutions to improve and increase income for the population. Given the current unfavourable market conditions, the government and relevant ministries should maintain stable macroeconomic policies and extend tax and fee incentives to allow the business community sufficient time to adapt and overcome challenges.
