Hard to find a comprehensive strategy for domestic trade development

	Domestic trade promotion helps spur economic growth
	Domestic trade promotion helps spur economic growth
	Workshop on domestic trade development strategy to 2025

The view of domestic trade development in the coming time is based on the market foundation and respect for market rules Photo: Nguyen Thanh

The overall strategy is missing

Deputy Minister of Industry and Trade Do Thang Hai said: In recent years, domestic trade continues to play an important role in the consumption of products, meeting the demand for goods for the people and making an important contribution to the development of the economy. In the period of 2006-2018, although investment from budget sources is still limited, the average contribution of domestic trade in GDP is above 10% per year, creating jobs for about 12-13% of total social labor. Generally from 2006 to now, the average growth rate of total retail sales is always 1.5-2 times higher than the average growth rate of GDP in the same period...

However, Deputy Minister Do Thang Hai also emphasized: Up to now, Vietnam is still lacking a comprehensive strategy to promote domestic trade development in a sustainable way. Therefore, the Government has directed and the Ministry of Industry and Trade presided over and submitted to the Prime Minister for promulgation the Domestic Trade Development Strategy for the period up to 2025, with a vision to 2035. Currently, the Ministry of Industry and Trade is seeking comments on the content of this Draft.

Regarding the construction of the Draft Strategy, Mr. Tran Duy Dong - Director of the Domestic Market Department (Ministry of Industry and Trade) said: The nature of trade is changing rapidly with the emergence of new commercial forms, retail model, the development of the Industrial Revolution 4.0; the formation of product chains and value chains. Besides, recently, protectionism has shown signs of returning, the uncertainty of the world economy increases. Participation in Free Trade Agreements (FTA) creates more competitive pressure for enterprises in the industry. These fluctuations are having many direct and indirect impacts on domestic trade. Therefore, Vietnam needs a new strategy in domestic trade development to promote domestic production and consumption by connecting producers with distribution channels, connecting rural areas with city areas, promote product chain linkage...

“Domestic trade development perspective in the coming time must be based on market foundation and respect for market rules. The state only engages in sectors, industries and products that the private sector does not do, or is unable to participate. State management on domestic trade focuses on maintaining market order, stabilizing the market, encouraging all economic sectors to participate in the market, creating an equal competitive environment and overcoming the downsides of the market economy…," Mr. Dong said.

Regarding specific objectives, Mr. Dong added: In the period from now to 2020, GDP of trade sector accounts for 9.61% of the total GDP of the country; the average growth rate of the industry is about 12.6%/year. By 2020, the retail level of goods in the domestic economic sector will account for about 95% of the total retail commercialization of the FDI sector, accounting for about 5%. Besides, the rural market system, the infrastructure of rural trade will soon be completed in accordance with the needs of the people...

Stimulate production to go up

Evaluation of the content of the Draft Strategy, according to economic expert Tran Dinh Thien: Vietnam's goal in the coming time is basically to increase the amount of trade. However, the decision must be caste, meaning value added. “We should have a forecast on the changing trends in supply and demand structure. Certainly, this will change, related to domestic production. Vietnam cannot import Chinese goods as much as it is now. Besides, the explosion of e-commerce with electronic payment, changing infrastructure, changing methods, jobs, income changes... management must also change," said Mr. Tran Dinh Thien.

According to Assoc. Prof. Dao Van Hung - Director of the Institute of Policy and Development (Ministry of Planning and Investment), everything is changing fast. A big retail group like Alibaba has no stores or big taxi companies do not have any cars. One of the other changes is payment technology, Fintech (mobile payment). Therefore, the given strategy must also predict the impact of technology on policy. “Although the strategy is mentioned, it is unclear. I feel that there is no real worry of technology change to this strategy. In addition, the strategy should also mention the competitive risks of production and trade of foreign retailers to warn later. The fact is that foreign retailers are dominating and expanding markets. Due to the current market expansion commitment, FTAs are both opportunities and challenges. We open the door for them and they open for us, the pressure of competition is very high,” Dr. Dao Van Hung said.

Vietnam runs biggest trade surplus with US, EU in 11 months

Related to domestic trade, according to Dr. Dao Van Hung, the point to be further clarified is the assessment of the quality of labor in the commercial sector on a professional perspective. Currently, professionalism in commercial labor compared with changes is still inadequate. In addition, the strategy also needs to supplement the work of improving traditional markets, the allocation of central and local budgets for this purpose. Vietnam cannot leave the traditional market because of its convenience. In the mentioned strategy, the mobilization of budget allocation is not really clear.