Does Vietnam still have room to stimulate consumer demand?

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Play an important motivational role

Data on the socio-economic situation in the first six months of the year of the General Statistics Office show that the gross domestic product GDP in the first half of this year increased by 3.72%, of which the largest contribution is still the service sector accounting for nearly 79%. Policies to stimulate domestic consumption and promote tourism activities have contributed to maintaining the growth of this region and become an important driving force for the economic growth of the country.

Specifically, the total retail sales of consumer goods and services at current prices in the first 6 months was estimated at VND 3,016.8 trillion, up 10.9% over the same period last year (same period in 2022), increased by 12.2%, if excluding the price factor, it increased by 8.4%, equivalent to the same period in 2022, but the new scale was only 84% before the time the economy was affected by the Covid-19 epidemic. Besides, the size of total retail sales and revenue of consumer services at current prices in the first 6 months of the year in the period of 2019-2023 will decrease in 2020 due to the impact of the economy, due to the shock of the Covid-19 epidemic, then from 2021 to gradually increase in size compared to 2019 and achieve positive growth gradually approaching the growth rate of 2019.

The difference in the growth rate of total retail sales of consumer goods and services in the first 6 months of this year compared to previous years is the large contribution of the accommodation, catering and tourism sectors to overall growth. In the general increase of 10.9% of total retail sales of consumer goods and services in the first 6 months of this year, the accommodation and catering sector increased by 18.7%, contributing 1.9% to the general growth rate (in the first 6 months of 2022, up 27%, contributing 2.4%); the field of travel and tourism increased by 65.9% (in the same period in 2022, the corresponding increase was 98.3%). The driving force behind the growth of these two sectors is the strong recovery of the tourism industry, when the number of domestic tourists in the first 6 months of this year reached 63.5 million arrivals, up 4.4% over the same period of last year, especially the strong recovery of international visitors to Vietnam with 5.6 million arrivals, 9.3 times higher than in the first 6 months of 2022.

The recovery of the tourism industry also has a strong impact on the increase in total retail sales of goods and consumer service revenue of localities with tourism and entertainment activities such as Quang Ninh up 15.1%, Khanh Hoa increased by 13.4%, Da Nang increased by 13.4%. In addition, the effectiveness of policies to stimulate domestic consumption demand, social security policies and the recovery of enterprises also created a driving force for domestic consumption to increase in some provinces, big cities, and provinces with industrial zones concentrated such as Hanoi increased by 6.1%, Hai Phong increased by 12.9%...

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Stabilizing the supply of goods to serve the people's essential needs, combined with promoting the implementation of activities to stimulate domestic consumption. Photo: Thu Diu.

There's plenty of room left

Assessing the potential for growth in total retail sales and consumer service revenue in the last 6 months of 2023, Ms. Le Thi Hien, Department of General Statistics and Dissemination of Statistical Information, said if properly assessed and Seizing the opportunity well, we still have a lot of room for this field to achieve high growth in the last 6 months of the year.

Specifically, policies to attract international visitors to Vietnam and policies to stimulate domestic consumption continue to create room for an increase in total retail sales of consumer goods and services in the last 6 months of 2023. In the first 6 months of 2023, the number of international visitors to Vietnam is only 66% compared to 2019, this is a big "gap" that needs to be filled and recovered in the last months of this year. Therefore, localities need to actively implement the promotion of tourism images, products and services, and tourism stimulus programs in order to strongly attract international visitors, making a great contribution to the growth of the retailing sector on consumer goods and services.

In addition, the increase in the base salary for civil servants, applied from July 1 this year will certainly put pressure on inflation in the last months of the year, but people also tend to increase their expenditures. Therefore, this is also a space to effectively implement programs to stimulate domestic consumption in order to take advantage of and attract increased income to the people.

In order to promote the growth of total retail sales and consumer service revenue in the last 6 months of the year, Ms. Le Thi Hien said that it is necessary to focus on implementing policies to minimize the impact of increasing commodity prices from the increase in basic wages. The department applied from July 1 to make people's income more substantive, avoiding the situation of "price goes first, salary follows"; stabilizing the supply of goods to serve the people's essential needs, combining with accelerating the implementation of activities to stimulate domestic consumption, especially programs connecting supply and demand on a digital platform.

At the same time, promoting tourism activities through promoting tourism diplomacy, strongly attracting international visitors to Vietnam in the last 6 months of the year, especially visitors from the US, Korea, and other countries. European countries; deploying more activities to stimulate domestic tourism in advantageous localities... Because this is a positive solution to turn the space into a driving force for travel tourism to develop and boom, having a strong impact on the total retail sales of consumer goods and services in Vietnam in the last months of the year.