Market Construction Must Be Linked to Local Development Plans

At present, Hanoi has 14 commercial centres, accounting for some 15 percent in the country, but they mainly have small and medium scales. In an interview with Vietnam Business Forum, Mr Nguyen Van Dong, Deputy Director of Hanoi Department of Industry and Trade, said: Commercial centres in the capital city are not only limited in quantity but also in scale. They cover a total area of nearly 412,000 square metres, or an average of 37,000 square metres each - the second-grade area. Me Linh Commercial Centre (Me Linh district) is the largest with some 80,000 square metres. Scale limitation diminishes the efficiency of the network, and the level of human resources and the quality of services are low while rentals are very high, thus causing negative impact on production and consumption.

 

In fact, operations of commercial centres are just limited to some services like retail shop, supermarket, office, recreation and physical practice, restaurant, ATM and transportation. Hanoi gets a minus point because it does not have international and regional commercial centres, large-scaled wholesale centres and logistics centres. This shows that functions and services of commercial centres have not brought to full play. Thus, its impact on the trade of Hanoi, the northern economic zone and the Red River Delta is weak, said Mr Nguyen Thai Dung, Deputy Director of BigC Thang Long International Trade and Supermarket Service Co., Ltd.

 

He added that the profitable existence of makeshift markets and unplanned small commercial centres needs to be put to an end to realise the objective of master planning.

 

The Hanoi People’s Committee - the governing body - has collected opinions for the draft master plan for trade development through 2020, with vision to 2030. According to the draft plan, the city will build nine shopping and trade fair centres of regional and international class. Particularly, five regional commercial centres are located in Long Bien district, Gia Lam district, Soc Son district, Chuc Son town (Chong My district), Hoa Lac urban zone and Phu Xuyen district. International commercial and trade fair centres will be built in Tay Ho, Tu Liem and Dong Anh districts.

 

However, it is not easy to attract investors to build retail systems under the current difficult context. Besides, concerned companies need support of mechanisms and policies from the municipal authorities.

 

Mr Nguyen Van Dong said: The city needs to introduce incentives to attract investment capital from different economic sectors. Particularly, it provides space, electricity and water for market and commercial centre construction projects. Besides, it needs to create favourable conditions for enterprises to access soft loan sources. To quick construction progress, the city necessarily applies different investment methods and forms. Market development must be attached to new local development plans.

 

Mr Nguyen Thai Dung of BigC Thang Long, said: The city needs to introduce policies to attract foreign capital sources like ODA and FDI. Administrative procedures and investment attraction processes must be transparent. Then, we can speed up the linkage of Hanoi market with other localities in the country as well as the world. However, it is important that each company must improve its competitiveness and human resources to meet the development demand.

 

Importantly, the authorities must make public detailed plans for enterprises to study, particularly suburb areas. In fact, market and commercial centre construction projects require huge investment capital but the capital recovery is quite slow. For this reason, the municipal government also needs to have policies concerning infrastructure investment capital support. While building new urban areas, it is essential to have spaces for the construction of convenience stores. These spaces will be managed by the Municipal People’s Committee and assigned to trading companies to use. Then, we will create a transparent mechanism to woo investors, said Mr Vu Thanh Son, General Director of the Hanoi Trade Corporation - a leading retailer in the city.

 

In reality, provinces and cities are trying to follow each other in development schemes. For example, when a province has funds to build a supermarket, the others will seek any measures to have funds to build supermarkets although they do not actually know how such facilities will be used. Mr Nguyen Van Tat, Vice Chairman of the Vietnam Architects Association, said: Apart fro supporting policies, the city needs to base on actual demand before granting market and commercial centre investment licences.