VietNamNet Bridge - Deputy PM Trinh Dinh Dung has instructed government agencies to consider applying measures to support Vietnamese retailers (rescheduling tax land payments and allocating land to retailers) and controlling the expansion of foreign-invested retail chains. 

Dung, at a meeting discussing solutions to manage and develop the retail market held in late January, emphasized that retail is a business sector which plays a very important role in regulating and orienting production. 

Meanwhile, problems still exist in the domestic market management undertaken by ministries, branches and local authorities, especially in the implementation of the regulation on ENT (economic needs test). 

ENT is a tool for the government to control the expansion of foreign-invested retail chains and protect domestic retailers.

Dung also pointed out that the observance of laws by foreign-invested distribution enterprises is not implemented effectively, and Vietnamese retailers do not receive effective support to expand their networks.

He instructed ministries, branches and local authorities to adjust legal documents related to retail industry management, tighten control over the opening of the retail market to foreigners and take action to support Vietnamese retail enterprises.

Experts had many times warned about the rapid expansion of foreign-invested retail chains in Vietnam thanks to the loosening of ENT implementation, saying that the presence of so many powerful retail chains in the domestic market which have powerful financial capability and experience would kill domestic retailers. 

They also warned that the dominance of foreign retailers in the domestic market may kill local production because foreign retailers would sell products from their home countries.

Meanwhile, other analysts commented that the government of Vietnam seems to worry too much about the expansion of foreign retail networks, saying it will flood the market with foreign products and harm local production.

In global economic integration, however, Vietnamese retailers will not sell Vietnamese-made products only, but will have to look for foreign suppliers to diversify products. 

This will force manufacturers and suppliers to improve their product quality.

As for foreign retailers, they will not distribute foreign-made products only, once they can find domestic supply sources that can provide goods at more competitive prices and better quality. 

They understand they will lose Vietnamese customers if they do not offer products at reasonable prices and high quality.

Lawyer Nguyen Tien Lap commented on Thoi Bao Kinh Te Sai Gon that the government needs to protect local goods, not the sellers.

“The key is not who sells goods, but what is sold,” he said. 

Thanh Lich