What to do to stimulate purchasing power on the occasion of Lunar New Year 2024?

Sustainable market stimulation

Expert Vu Vinh Phu - former Chairman of the Hanoi Supermarket Association - commented that the most important thing to stimulate consumption is to create more social purchasing power in a sustainable way.

Economist Vu Vinh Phu. Photo: Ke Toai. — Economist Vu Vinh Phu. Photo: Quang Minh.

Annual statistics show that social purchasing power will gradually increase until the end of the year. In the past 1-2 months, trade fairs, product introductions, and promotions have been continuously held in regions, supermarkets, and shopping centers across the country.

This person affirmed that consumption is one of the three main pillars for economic development in Vietnam. While exports still face difficulties, the domestic market of one hundred million people and much untapped potential is certainly the target that retailers must pay special attention to.

“We attach great importance to the stimulus measures being implemented, which from July 1, 2023 will be further stimulated by the government's VAT reduction policy, which will bring new vitality to social purchasing power from now until Lunar New Year 2024.

In stimulating consumer demand, experience shows that creating sustainable purchasing power is certainly the most important solution that we must delve into and address in order to implement more effectively in promoting production, increasing retail sales, and profits for businesses from now until the end of the year. Expert Vu Vinh Phu said and affirmed that to do this, more deeply we must solve the problem of creating jobs, income, and improving the lives of each family and individual in the community.

Solving the above two issues will not only increase the purchasing power of workers in the business sector and public investment, but also have a strong spillover effect to other material production and service industries such as providing raw materials for production, materials such as iron, steel, cement... to serve invested projects nationwide.

Next, we must solve the problem between production and distribution for consumption. Currently, manufactured goods are quite abundant, and quality has been improved a step, but the connection between production and distribution is still loose, fragmented, and localized. Profits in the value chain are not distributed fairly, and losses often fall on the producers of material wealth for society.

Tighten smuggling and trade fraud

In addition to creating jobs for workers, according to expert Vu Vinh Phu, the authorities also need to control smuggled goods and trade fraud. Because this problem is causing legitimate producers and traders to suffer losses. On the other hand, competition in the domestic trade sector is still unequal, transparent and open. These existing problems have significantly limited the stimulation of consumer demand.

There is a reality that everyone is aware of: Purchasing power cannot increase strongly because in the current economic period, according to the Institute of Workers' Economics of the Vietnam General Confederation of Labor, workers' salaries are only enough to cover 75% of their lives. As for farmers, who account for 70% of the social labor force, their agricultural products often have good harvests and lose value, and the profits after sales are not enough to cover the costs of growing crops and raising livestock...

Expert Vu Vinh Phu commented that if the strengths of the stimulus packages are promoted and the above-mentioned shortcomings are overcome, the upcoming stimulus package will certainly make positive contributions to the implementation of the plan for the circulation of goods and social consumption services in 2024. This will be the premise for the development of production, trade and services in the following years.

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