HANOI (Xinhua): Vietnam’s food and drinks sector is expected to project robust growth, boosted by strong domestic consumption and interconnectivity with international markets, Vietnam News reported on Tuesday (April 18).
The food and drinks industry is forecast to witness significant growth, driven by a rapidly expanding domestic consumer market, said Vu Ba Phu, head of the Vietnam Trade Promotion Agency under the Ministry of Industry and Trade.
Given the fact that Vietnam’s population is going to reach 100 million soon, there is an untapped potential in the local consumer market, said the trade officer, noting that with about 50 per cent of the population under 35 years old, the industry is significantly supported by surging consumer spending trends among the affluent and young.
Over the next decade, 36 million more may join the South-East Asian country’s consumer class who spend at least US$11 a day, according to a 2021 report by consulting group McKinsey, adding that Vietnam’s consumer class would grow rapidly from 10 per cent of the population in 2000 to 75 per cent by 2030.
And Vietnamese people’s spending on food and drinks currently accounts for the largest proportion of 35 percent of their monthly expenses, financial services provider Fitch Solutions estimated.
Factors such as growing urbanisation, increasing e-commerce use, easier access to mobile devices, and surging trend for online food delivery have also contributed to the market’s growth, said industry insiders.
To meet the rising demand, the number of domestic players in the food market has climbed nearly 84 per cent from 2019 to more than 5,000, said the head of the Vietnam Trade Promotion Agency.
Another important factor supporting the sector is that free trade agreements have helped exporters, especially those with agro-forestry-fishery products, to penetrate new international markets through different distribution channels, including supermarkets, shopping centres and e-commerce platforms.
International cooperation, for instance, in which Vietnamese companies can supply the raw material in large numbers while their partners in South Korea have processing technology, will boost the food and drinks industry to grow further, said experts.
The rising demand for the traditional cuisine of Vietnam among consumers of other countries is influencing the growth rate of the sector, said Pham Thi Dao, deputy director of the Department of Agriculture and Rural Development of northern province Hai Duong, which is known for lychees, off-season guavas, the traditional sweet mung bean paste among others.
She urged the government to support local food businesses to invest in processing technology and seize export opportunities.
Source: The Star