Opening markets disadvantage Vietnamese firms
  • By Nguyen Tuyen | | August 12, 2014 09:52 AM
 >>  Thai group buys Metro Vietnam for nearly USD900 million

Several experts have expressed worries that Vietnamese goods may lose their standing in the domestic market after a Thai group bought Metro Vietnam for nearly USD900 million.

Metro AG agreed to sell all 19 of its Vietnamese stores to a Thai group named Berli Jucker (BJC) for USD879 million as the German retailer prepares to withdraw from Vietnam. The trend among European companies operating in Vietnam has been to exploit Vietnamese products as opposed to importing. However, the case may be different with Berli Jucker.

In 2013, the Thai billionaire Dhanin Chearavanont bought a supermarket in HCM CIty and increased the market share of Thai products to 60%. 

The effect has spilled over into Vietnam, where more Thai products can be seen on supermarket shelves recently. According to the General Department of Vietnam Customs, in 2013, Vietnam imported consumers goods worth a total of USD 6.31 billion. Supermarkets have become familiar shopping locations in the country, and while mergers and acquisitions increase, the domestic market is changing as rapidly. 

Vu Minh Phu, chairman of the Ha Noi Supermarket Association, said, "Thai entrepreneurs have a long-term and detailed plan to gain access to the Vietnamese retail market. They hold four exhibitions each year, bringing visibility of their products to wholesalers and retailers alike. We need a similar policy that is suitable for this country in order to balance the market and create opportunities for domestic producers. I think supermarkets should have a quota of Vietnamese products on display on their shelves." 

Starting in 2015, a number of foreign firms will be tax-exempt as a result of ASEAN agreements. This is expected to temporarily cause problems for Vietnamese producers. Many experts point to a focus on quality and brand recognition as a solution.

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