Business and Market Review on Vietnam

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A lot of the Vietnamese population are in the rural areas though the proportion with the urban inhabitants are gradually increasing from 19.7% in 1990 to 26.0% in 2004. Vietnam's largest city is Ho Chi Minh City (population 5.0 million) and Hanoi (population of three.5 million) then Nai, Haiphong and Dac Lac.

Household income in Ho Chi Minh City is practically 3 times the national average - the city is the reason nearly half of all of the motorbikes in Vietnam. Nearly 20% of people live below the poverty level and mainly from rural households. 10%-15% with the households are middle to high-income households while 65%-70% are lower-income households.

INFRASTRUCTURE. Vietnam's telecommunication systems lag behind many neighbouring countries in the region and thus government puts great increased exposure of its modernisation. Digital exchanges now connected to Hanoi, Da Nang, and Ho Chi Minh City and main lines have risen while the use of mobile telephones keeps growing. The nation's road system stretches in the northern to southern tip of Vietnam. Northern and southern Vietnam are using two air terminals and a couple main sea ports serving international shipping.

INTERNATIONAL TRADE. Vietnam's major trading partners include the US, Japan, China, Australia, Germany, Singapore, Taiwan, Thailand and The philipines. Major exports include oil, seafood, rice, coffee, cashew nuts, rubber, tea, garments and shoes. Major imports include machineries and equipments, petroleum products, fertilisers, steel products, cotton, grains, cement and motorcycles.

CONSUMER Use of TECHNOLOGY. There was nearly 10.One million telephones positioned in Vietnam and nearly 5.0 million cell phone subscribers in 2004. The government is putting considerable efforts to modernise and increase the country's telecommunication system but nevertheless lags in comparison with Singapore, Thailand and Malaysia. Computer penetration is low; estimates change from 2% to 4% of the population in 2004 and an estimated 5.8 million internet users. The penetration of television is simply 20% and concentrated to homes within the towns and cities. Similarly, setting up refrigerators is targeted within the cities where 60% of the homes have refrigerators.

RETAIL MARKET. Retail sales in Vietnam grew by 8%-12% annually from 2000 to 2004 caused by increasing disposable income as a result of country's strong economic growth. Vietnamese consumers spend two-thirds of their income on retail purchases amounting to US$16.3 billion in 2004. Traditional wet markets as well as the "mom and pop" shops dominate the retail industry making up 95% in the total retail trade. Several stores measure a maximum of five square metres (54 feet square). Modern retail establishments are limited but gradually emerging in the united kingdom and generally locally owned businesses concentrated in Ho Chi Minh City and Hanoi.

FOOD CULTURE. Rice and noodles would be the staple food in the Vietnamese but taste preference differs by region. Foods in central Vietnam are spicier while foods in northern and southern Vietnam are less spicy and therefore are saltier. The Vietnamese often dip their foods with chilli, garlic or fish sauce to add flavour. In france they colonialists introduced European style bread and bakeries into the Vietnamese food culture. Western style fastfood service establishments are starting to emerge alongside the traditional snack bars, cake shops and mobile food carts.
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