Consumer confidence index declines (Photo: Bizhub)
Reversing the earlier trend, the Vietnam Consumer Confidence Index declined to 104, a decrease of 8 percentage points from the first quarter and the biggest quarterly decrease in Asia Pacific, according to the latest survey released on July 27 by global information and measurement company Nielsen.
Vaughan Ryan, Managing Director, Nielsen Vietnam, said: "The Vietnam retail environment has evolved from one of the fastest growing markets in 2012 to one that's struggling to remain in growth, with sales levels between 2 percent-3 percent for most of the last 12 months."
Consumers are feeling less optimistic about their immediate future, but are confident in the longer term, as most expect the economy to improve in the year ahead, he said.
For the first time in well over a decade Vietnam experienced a decline in the Consumer Price Index in February, while foreign direct investment was down over 20 percent year-on-year in the first quarter.
The Nielsen Global Survey of Consumer Confidence and Spending Intentions polled more than 30,000 online consumers in 60 countries throughout the Asia-Pacific, Europe, Latin America, the Middle East/Africa and North America.
Consumer confidence levels above and below a baseline of 100 indicate degrees of optimism and pessimism.
The report also reveals that confidence levels in Southeast Asia remain relatively high compared to other parts of the globe despite a decline in most countries in the second quarter.
The Philippines was the only market where consumer sentiment strengthened, gaining seven points to rise to a score of 122 - the second most confident consumers globally.
Indonesia ranked third with a score of 120 points while Thailand retained fifth place with 111. Consumer confidence levels fell by 1 percentage point to 99 in Singapore and by 5 points to 89 in Malaysia.
Southeast Asian consumers continue to be among the world's most avid savers, with close to four in five (70 percent) channelling their spare cash into savings compared to just 48 percent globally.
Vietnam scored the highest globally (73 percent) followed by the Philippines (72 percent), Indonesia (69 percent), Singapore (66 percent), Thailand (66 percent), and Malaysia (65 percent).
Saving on household expenses continues to be the top priority for Vietnamese consumers with 86 percent adjusting their spending habits over the past 12 months to save on household expenses because most think the country is in a recession at the moment.
More than three out of five Vietnamese consumers have reduced their spending on new clothes and gas and electricity. Around half have cut down on out-of-home entertainment (57 percent) and delayed upgrading their technology devices (48 percent).
However, after covering essential living expenses, nearly half of Vietnamese consumers are willing to spend on big ticket items such as vacations (45 percent) and new clothes as well as home improvement (35 percent).
The state of the economy remains a key concern for consumers over the next six months in Southeast Asia (18 percent), particularly in Malaysia (28 percent) and Thailand (26 percent). Other major worries in the region include job security, health and work-life balance.
Job security and the economy were back as the top concerns for Vietnamese consumers (14 percent) followed by health (13 percent).-VNA
