Luxury market soars in Vietnam

Hermes handbags are big in Vietnam. Source: Wikimedia 

Asia Briefing says of the 50 Mercedes-Maybach S600s priced at around US$427,000, which will soon be launched into the global market, Vietnam’s elite has ordered 10.

Nguoi Lao Dong reported a consignment of Hermes handbags recently sold out in Vietnam in no time at a price tag of US$71,000 each.

Bugatti, Rolls Royce, Bentley and Maybach cars all are available in Vietnam, while other luxury brands have sales agents there, arguing that the “communist” Southeast Asian state is a paradise for luxury goods.

Many Vietnamese use smartphones were valued at tens of thousands of dollars, according to a UK retailer.

Knight Frank reported a steep rise in demand for luxury goods. Branded goods are available in the big city malls and foreign food imports are rising.
Despite the luxury tax being two to three times higher than that on domestic luxury products, wine from France, Italy Chile and Russia are selling well at restaurants and hotels.

Despite impressive growth, Vietnam’s GDP per capita is only just equal to that of Malaysia in 1998, Thailand in 1993, Indonesia in 2008, the Philippines in 2010 and South Korea in 1992.

A report of the General Statistics Office in August showed that Vietnam’s GDP per capita in 2014 was $2,050 per annum. The figure was 21 times higher than that in the 1990s, but just equal to three-fifths of Indonesia, two-fifths of Thailand, one-fifth of Malaysia, one-quarter of South Korea and one-27th of Singapore.

Vietnam is among the four least developed countries in Asean along with Cambodia, Laos and Myanmar.

The World Bank puts Vietnam’s business environment at 78th among 189 countries and territories.

Singapore tops the list, Malaysia is 18th and Thailand 26th. The Philippines is 95th, Indonesia 114th, Cambodia 135th and Laos 148th.

The Spices Board, the Indian government’s regulatory and promotion agency for Indian spices, has signed a memorandum of understanding (MoU) with Vietnam Pepper Association (VPA), Vietnam’s national pepper trade body, for starting futures trading for pepper in Vietnam.

The MoU was signed during the International Pepper Community (IPC) meeting, in Mysore in southern India in late November.

The Spices Board would initiate futures trading soon, sources said.

Vietnam is the world’s largest peppercorn producer and exporter with an annual output of 150,000 tonnes, around 40 per cent of global trade.

Vietnam has not started futures trading and the exporters are following the Indian counters for fixing prices.

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