Vietnam advised to capitalise on domestic market to drive growth
The forecast for 2024 indicates that consumer demand will continue to be a primary contributor to Vietnam's economic growth, in addition to the ripple effects of public investment and exports.
Tran Du Lich, an economic expert, asserted that it is time to fully exploit the domestic market, considering it the focal point to balance the country’s export-oriented economic policies and strengthen the economy's internal capabilities.
The domestic market, encompassing trade and services, holds a significant share in GDP growth. Moreover, Vietnam's market of 100 million people remains attractive to both domestic and foreign investors.
Lich highlighted key measures to bolster the market, such as tax tools, consumer credit expansion, tourism promotion, and institutional reforms.
Supporting this perspective, Nguyen Quoc Viet, Vice Director of the Vietnam Institute for Economic and Policy Research (VEPR), said the service sector, especially domestic consumption, played a crucial role in GDP growth in 2023 and continues to be a major driver of economic growth this year.
According to the expert, stimulating domestic consumption in the current context should not only follow traditional measures but also align with new criteria for green growth and carbon reduction. Additionally, addressing challenges in the real estate market and institutional reforms are necessary to build investors’ confidence.
Nguyen Anh Duc, President of the Association of Vietnam Retailers (AVR), recommended businesses to seize opportunities arising from the implementation of trade agreements between Vietnam and other countries and regions worldwide, integrating them into their production and business operations.
Highlighting the current situation where Vietnam's goods exports heavily rely on the contribution of foreign-invested enterprises, which accounts for 70-75% of the country's total export turnover, Do Thien Anh Tuan, a public policy lecturer at the Fulbright School of Public Policy and Management, said that stimulating domestic consumer demand is the most practical solution. He suggested focusing on the "Vietnamese prioritising Vietnamese goods" campaign and steering support towards domestic enterprises.
According to economic experts, the domestic market still holds untapped potential. While growth pillars like exports and investments face challenges, boosting the consumption pillar is the quickest, cost-effective, and potentially high-impact solution.
