VietNamNet Bridge – Despite the economic recession and the GDP growth slowdown, Vietnam’s brewery industry has still been growing steadily by 10 percent per annum, because it has a vast domestic market.

High growth rate

The Ministry of Industry and Trade (MOIT) is reconsidering the drink industry development strategy. However, policy makers think that the current growth rate is reasonable and it is highly possible that the forecast output by 2015 would be kept intact.

A MOIT’s report showed that Vietnam put out 273.9 million liters of beer in November 2013 and had put out 2.67 billion liters in January-November 2013, an increase of 7.8 percent over the same period of the last year.

The “big guys” in the industry have predicted that the total beer output may reach 2.9-3 billion liters by the end of 2013. The figure is within reach if considering the high growth rate compared with the same period of the last year.

According to Le Ba Co, Deputy Secretary General of the Vietnam Beer, Alcohol, Beverage Association (VBA), with the current stable growth, Vietnam’s beer output would be 3.3 billion liters in 2014 and 3.6 billion liters in 2015.

The forecast growth rate is still lower than the one predicted by MOIT in the industry development program by 2015. Under the program, Vietnam would make and consume 4.2-4.4 billion liters of beers, which means every Vietnamese consumes 45-47 liters a year. The figure is expected to 60-70 liters 10 years later.

The figures do not surprise anyone. In 2012, Vietnam consumed 3 billion liters of beer, worth $3 billion, ranking itself among the 25 countries which drink most beer in the world and the third in Asia.

Vietnamese not only spend money on Vietnam made beer, but expensive imports as well. Michel de Carvalho, Heineken’s representative predicted that Vietnam would be the biggest Heineken consumption market in the world by 2015.

Vietnam should develop export-oriented brewery industry?

Sociologists have voiced their concern about the increasingly high beer consumption level, pointing out that this has caused big consequences which cannot be settled by the turnover from the industry.

Meanwhile, Co from the beer, alcohol and beverage association, said the big contribution of the industry to the national economy should be recognized, emphasizing that the industry has not fallen into decay like others, but still develops and pays tax.

Dr. Nguyen Minh Phong, a well-known economist, while suggesting that it is necessary to consider both the positive and negative impacts of the beer production, believes that the government should drive the industry into an export-oriented industry. This means that Vietnam would make products for export to earn money and create more jobs.

At present, Vietnamese brewery manufacturers mostly serve the domestic market. Meanwhile, according to Phong, they can make heavier investment to develop the production and export their products.

Sabeco now holds the biggest domestic market share which provides 1.3 billion liters of beer per annum, or 40 percent of the total output. Habeco, which makes out 700 million liters of beer, accounts for 20 percent of the market share. Meanwhile, Heineken, with five plants in Vietnam, hold the other 20 percent of the market share.

K. Chi