Invest in Vietnam

With an estimated 90.5 million inhabitants as of 2011, Vietnam is the world’s 13th most populous country, and the eighth most populous Asian country. It is bordered by China to the north, Laos to the northwest, Cambodia to the southwest, and the South China Sea to the east. With its large population and great geographic location, Vietnam is likely to be one of the biggest markets of the future. According to a 2008 forecast by PricewaterhouseCoopers, Vietnam may be the fastest growing of the world’s emerging economies by 2025, with a potential growth rate of almost 10% annually in real dollar terms.

▶ WTO Membership

Vietnam’s membership in the World Trade Organization began in January 2007 and has led to a rapid growth in Vietnam’s retail market in the recent past. Post-WTO membership growth made the country one of the world’s five most lucrative retail markets for multinational retailers.

▶ GDP Predictions

In 2011, Vietnam’s nominal GDP reached $121.6 billion dollars with a nominal GDP per capita of $1,361 dollars, according to the IMF. According to a forecast in December 2005 by Goldman-Sachs, the Vietnamese economy will become the 17th largest in the world by 2025, with an estimated nominal GDP of $436 billion dollars and a nominal GDP per capita of $4,357 dollars.

▶ Global Trade

Vietnam is integrating into the world’s economy as a part of globalization and is an increasingly attractive foreign investment destination in Southeast Asia. Vietnam’s chief trading partners include China, Japan, Australia, the ASEAN countries, the United States and Western Europe. Its economic growth has been among the highest in the world since 2000 and is set to continue growing at an impressive rate.

▶ International Retailers

Major international retailers have entered the Vietnamese market with successful results. Various Korean companies, such as Lotteria, Lotte Mart, Tous les Jours, and BBQ Chicken, are actively working as Korean franchise leaders in Vietnam. Lotte Mart currently operates two large complexes in Vietnam and plans to invest $5 billion dollars into 30 department stores. E-Mart, which is Korea’s biggest retail group, set up a joint venture with Vietnam’s U&I Group and is planning to open a chain of 52 supermarkets by 2020 with investment capital of $8 million.

Other renowned international franchise companies in Vietnam include Gloria Jean’s Coffees (Australia), KFC (U.S.), FamilyMart (Japan), and many more. Japan’s FamilyMart retailing chain has expanded into 18 stores only two years after its entrance in Vietnamese market. The Aeon Group, Japan’s leading retailer, has decided to invest about 100 million dollars for construction project of its very first trade center in Vietnam. Similarly, Malaysia’s WCT Group WCT Group is implementing the $600 million dollar shopping mall project in Vietnam.

▶ Controlled Economy Changes in 2011

When the Vietnamese government allowed 100 percent foreign-invested retailers to distribute goods in the domestic market, distribution and retail services have also developed strongly with the opening of hundreds of convenience stores, changing the complexion of the country’s retail sector. According to the General Statistics Office, Vietnam’s retail sales increased 22.6% in the first six months of 2011. In result, Vietnam’s 2011 retail sales reached total revenue of $90 billion dollars, contributing 15 percent of the country’s GDP. Business in Vietnam has been climbing and overall the country is a great market for expanding businesses.