There is no question that the Vietnamese economy is showing promise and that better days for its large consumer base are not long in coming. Vietnam's consumer base numbers 84.2 million people, according August 2006 statistics published by the Population Reference Bureau (PRB).
The graph above illustrates an element of that promise. The bright blue line shows the annual percentage change in retail sales in the country from 1996 through 2005. From 2001 on the increases in retail sales move sharply upward.
Not wishing to detract from that promise two major caveats are nonetheless in order. The first is that a "small base effect" does impact the importance of the growth numbers. Vietnam's per capita income for 2007 is estimated by the International Monetary Fund (IMF) at approximately us$3,500. This is the IMF's September 2006 prediction. So, while there is growth, Vietnam retail is starting from infancy.
The second caveat is that the country's infrastructure is still woefully undeveloped. In fact, according to an article in the New York Times (New York) on October 25, 2006 said that "deep-seated corruption has slowed construction; the government has put the brakes on highway building across northern Vietnam this year after uncovering a graft scandal that led to resignations and detentions all the way to the top of the Transport Ministry." The roads in Vietnam simply do not exist to the extent that permits anything like contemporary physical distribution.
And, of course, there is as well the burden of hyperbole.
In its headline, the same Times story cited above characterized the Vietnamese economy as "roaring." Ironically, a statement posted on a Vietnamese government website-which one might expect to be tolerant of boosterism, even indulgent- presented a much more modest view of the country's progress...