Vietnam is enjoying the fastest growing middle-class in the Asia-Pacific region with over two million citizens joining it annually, a recent survey shows.
“This is an important driving force that sustainably promotes domestic economic growth,” Glenn Maguire, chief economist of ANZ in the region, said in the survey released on Friday.
The survey, jointly conducted by Australia-New Zealand Banking Group (ANZ) and Australian market research firm Roy Morgan earlier this year, aims at building up a monthly consumer confidence index for each country in the region.
The first of its kind to reflect the confidence index of Vietnamese consumers, it reviewed the evolution in the consumer’s confidence via many other factors in which personal spending is becoming an important factor to contribute to the stability of growth.
In terms of personal finances, 48 percent of Vietnamese people surveyed said they expect their family financial situation would get better in the next year, while only 8 percent said their financial situation would worsen within the year.
“Along with the annual increase in per capita income of about 10 percent in Vietnam, we believe that economic growth will go towards rebalancing, which will result in increasing investment in the local economy, making Vietnam less dependent on exports in the next 10 years,”Muhmood said.
The index, conducted monthly on consumers in many provinces and cities in Vietnam, also provides an overview of the differences in psychological and consumer trends between large and small cities.
ANZ and Roy Morgan have done consumer confidence indices in Australia, New Zealand, Indonesia, China and Vietnam and plan to continue to conduct them in five other Asian countries over the next few months.
In late January of this year, the Boston Consulting Group (BCG) reported that the middle and affluent class in Vietnam will double in size between 2014 and 2020 from 12 million to 33 million, adding that those consumers whose income is from VND15 million (US$714) or more a month are spreading out to other provinces and cities.
By 2020, with an average per capita income of $3,400 per year, the population of Vietnam’s middle and affluent class will be two-thirds the size of that in Thailand.
Source: Tuoi Tre News
Comments:
The rapid growth in the number of middle-class families in Vietnam and in other countries of South-East Asia points that the market economy can quickly improve the quality of life. The market economy caused the fast recovery of European countries after World War II. However, since the 1970s European economy has been stagnating. So has Japanese economy, which had a growth in the quality of life till the 1990s. Why does the quality of life go up to a certain level and stop its growing then?
When a country is just beginning to get out of poverty due to market economy, new jobs are created and people’s incomes go up. There comes a moment when most people have already had a job and a decent salary. How can the level of life increase more? A working week can be reduced (today the level of technology is so high that people don’t have to work 40 hours a week, they work 20 or 30 hours a week instead), due to the growth of wealth of ordinary workers. But is it profitable for political and economic elite to let most people be financially independent? It is hardly true. In fact, to preserve the status quo, most people have to always be busy at work and have wages that are enough only for the basic needs of their family.