Vietnam's GDP expanded by a healthy 5.66 per cent in the first quarter of 2024, marking the strongest first-quarter growth since 2020. While slower than the previous quarter's 6.7 per cent growth, this momentum indicates the country is on track to achieve its 2024 economic targets.

The report also reveals that as the underlying economic outlook remains positive, consumer confidence in an economic recovery has reached a five-quarter high. While concerns about household incomes have eased, worries about rising living costs, particularly due to the proposed electricity price increases, have emerged.

Despite improved consumer confidence, the first quarter of 2024 witnessed a subdued performance in take-home fast-moving consumer goods (FMCG) despite a boost from the Tet 2024 (Lunar New Year) holiday. Both urban and rural areas experienced a decline in FMCG volume during the first quarter of 2024, leading to an overall value setback in total FMCG despite slowing grocery inflation. This decline was primarily driven by the food and beverage sectors, with stricter enforcement of legislation on driving under the influence significantly impacting alcoholic purchases.

The decline in alcoholic beverage sales accounted for 30 per cent of FMCG loss, followed by dairy and packaged foods. Conversely, personal care and cooking aids witnessed growth in the festive season.

In addition, online gained significant short-term retail value share in the first quarter of 2024, and is steadily growing in the long term, positioning itself to be the future driver of FMCG expansion. In rural areas, large provisions stores and specialty stores have been growing in prominence over the years.

While FMCG value during the eight-week period around Tet 2024 declined compared to the previous year, it still surpassed the peak of the 2019-2022 period. Notably, a significant portion of this decline can be attributed to reduced beer value in both urban and rural markets during the festive season.