Vietnam’s household spending to rise 5.7% YoY to $123.4m in 2022

This is due to the expected gradual lifting of restrictions this year.

Vietnam’s total household spending is expected to grow 5.7% year-on-year (YoY) in 2022 to reach around $123.4m (VND2.8t) on the back of the gradual lifting of restrictions, Fitch Solutions said in a report.

Fitch said the forecast is stronger than the 1.8% real growth in household spending in the previous year which suggests that  consumer spending “will increasingly return to a more normal growth trajectory this year.

“Vietnam was one of the few countries globally to not report a contraction in consumer spending over 2020, largely due to the authority's ability to relatively control the spread of the Covid- 19 virus in the country and limiting the extent to which restrictions closed retail trade,” Fitch said.

“We believe that as restrictions begin to slowly get lifted over the 2022, spending will return to more conventional growth patterns,” it added.

Real growth, however, in household spending will be reached in 2023 which is seen to increase 8.3% YoY.

Meanwhile, real consumer spending in 2022 is in line with Fitch’s Country Risk team’s forecast of the domestic economy which will grow 7% YoY, from a 2.6% YoY growth in 2021.

Rebound in consumer spending and growth in net exports will drive economic growth, it said.

However, it noted that consumer recovery will rely on the country’s vaccination drive. As of 31 January, 73.9% of Vietnam’s population has been fully vaccinated.

$1 = VND22,694.98