Vast potential for Vietnam retail market Five years after joining in the World Trade Organization (WTO), Vietnam' retail distribution system has still been in the early stage of its development. The growth of modern retail formats such as supermarkets and trade centers finds out more opportunities for imported and luxury products. Traditional retail sector however has dominated the market during years. Vietnam economy has been experienced the most difficult period with high inflation, trade deficits and currency devaluation, thus the Gross Domestic Product (GDP) in 2011 grew only by 5.89%. Vietnam, nevertheless, is one of the most potential emerging markets which is boost up the retail overall growth compared to other developed, developing and BRIC economies.

Macroeconomic imbalance, tight monetary policy and certainly drop in prices on real estate properties are some of the current hottest topics which generally result in heated debates and split opinions of their causes and solutions. Whatever they might be, the present market situation remains as a lingering issue for the real estate developers who have to deal with the extreme market pressure and the economic instability as well. The key focus is to have sustainable development to cover the financial losses due to the increased costs of construction and illiquidity in the real estate market.

On November 14th, 2011, the new policy which loosen credit for four real estate sub sectors to be excluded from non-manufacturing issued by The State Bank of Vietnam (SBV). There are included (1) Residents with capital demand for mending and buying houses which will be paid by their salaries and wages, (2) Building houses for sell and rent to low income customers and workers, (3) Building houses for workers in industrial zones without rent income or rental income not exceeding the regulation of Provincial People’s Committee, (4) Projects will be completed and handed over to customers before January 1st 2012. How the market has its reaction to the new policy comprising of (1) residents, (2) developers and (3) banks.

During 2011, Vietnam has faced a difficult time as with all the other countries. According to the Vietnamese General Statistics Office, Gross Domestic Product (GDP) growth rate for the first nine months in 2011 is 5.76% while inflation being 18.6% compared to the same period in 2010. However, according to International Monetary Fund’ (IMF) economic forecast, Vietnam economy is predicted to start recovering with the GDP growth rate at 6.2% and inflation constrained at 12.1% in 2012 as a result of tightened monetary policy which is expected to have positive effect on the real estate market.

For the first 09 months of the year 2011, Vietnam economy didn’t achieve its expected performance due to the disadvantages of the global economy. Ho Chi Minh City (HCMC), however, has maintained its high GDP growth rate of reaching 9.9% in the Quarter (Q) II 2011 and still considered as the most dynamic city over the nation.