Recent geopolitical developments in the Middle East and the rise in global oil prices have introduced short-term volatility across emerging markets, including Vietnam. We have seen this reflected in recent stock market movements as investors reassess risk in light of global uncertainty. In our view, though, amid the oil price crisis, Vietnam is relatively well positioned compared to many regional peers. The country’s domestic crude production supplies roughly 50% of refinery input, while local refineries account for around 70% of total fuel demand.
Even as investor sentiment fluctuates in the near term, we do not see a structural change in Vietnam’s domestic growth trajectory, based on our discussions at Vietnam Access Days (VAD) 2026 and ongoing observations on the ground. We expect the country’s consumer sector to remain supported by strong underlying fundamentals, such as rising income, more transparent policies, and accelerating infrastructure development.
This article is the fourth in our short series summarizing our observations from the event, following up on our stock market outlook. Below, we highlight key takeaways from the VAD discussions – shared by Cimigo’s Richard Burrage and Vietcap’s Research team – as well as our own perspective on the resilient growth of Vietnam’s consumer market despite external volatility.
Vietnam’s consumption growth over the past decade has been closely linked to its demographic structure. The country continues to benefit from a large working-age population, with around 62% of citizens in employment age and nearly half concentrated in the 22–39 cohort. According to Cimigo, high female labor participation has also played a significant role in supporting household income and consumption.
At the same time, this demographic advantage is gradually peaking. Birth rates have declined below replacement levels in several regions, and the proportion of the population above 50 is expected to increase significantly over the next ten years – but this isn’t a bad sign. In fact, we view this as a transition in demand patterns.
An aging population is expected to drive demand toward healthcare, convenience services, and leisure spending, while younger consumers continue to support demand for technology, branded goods, and digital services. This broadens the consumption base and creates new areas of growth.
Vietnam has reached an important stage in its consumption cycle. According to Burrage, approximately 59% of households now have discretionary income, representing around 60 million people. This is reflected in higher spending across education, financial assets, and lifestyle categories.
At the same time, we observe that consumer behavior has become more measured. Despite positive retail sales growth, real purchasing power is affected by higher perceived inflation at the household level. As a result, consumers are more selective, prioritizing essential goods and value, while delaying higher-value discretionary purchases.
We believe this reflects a fresh mindset post-COVID. Consumers are saving more, planning spending more carefully, and focusing on long-term financial stability. In our view, this shift favors companies that offer a clear value proposition, operational efficiency, and – most importantly – consistent product quality.
A key structural theme from VAD is the rapid transformation of Vietnam’s retail landscape. Traditional retail has declined over time, while modern trade and e-commerce continue to expand. Vietnam has moved quickly toward a digital-first consumer environment, supported by widespread smartphone adoption and mobile payments.
At the same time, regulatory changes are accelerating formalization, increase transparency and raise operating standards across the market:
Tighter tax enforcement and e-invoicing requirements for household businesses
Crackdowns on undocumented and counterfeit goods – including various food hygiene campaigns
Stronger product safety and compliance standards in many sectors, such as pharmaceuticals
In the near term, this creates pressure on informal businesses and parts of the consumer base. Over time, we expect it to strengthen the overall market structure, with demand shifting toward compliant and well-managed companies.
In the near term, consumer sentiment remains somewhat cautious. Higher living costs and ongoing formalization are weighing on spending decisions. That said, several factors are expected to support confidence and spending going forward, such as higher take-home income from tax adjustments, gradual rebuilding of household savings, and continued infrastructure development.
More importantly, Vietnam’s long-term policy direction remains consistent, with a clear focus on formalization, digitalization, infrastructure, and productivity growth. These priorities align with the country’s goal of reaching high-income status by 2045 and provide a stable foundation for domestic consumption.
Another highlight during the conference was the increasing level of competition within the consumer sector. Digital platforms have made pricing more transparent, while promotional activity has intensified. Meanwhile, consumers are allocating more spending toward experiences rather than purely physical goods.
This has created margin pressure in certain segments. However, we see this as a driver of operational improvement. Leading companies are responding by optimizing store networks, strengthening supply chains, and improving cost efficiency.
Data presented during Vietcap’s session shows that several retail segments are already seeing stable or improving margins alongside continued revenue growth. This indicates a shift toward a more sustainable growth model, where profitability and execution take priority over expansion alone.
A clear example is our portfolio company MWG’s Dien May Xanh (DMX), which has moved toward optimizing its existing store network rather than expanding aggressively. This approach has already delivered strong results, with improvements in same-store sales and margins despite a reduced store count.
We believe Vietnam’s consumer sector is entering a more mature stage. growth is increasingly driven by: (1) Market consolidation toward larger, compliant businesses; (2) improved operational efficiency and profitability; and (3) more disciplined and resilient consumer behavior. As the sector becomes more structured, these qualities are increasingly important in driving performance.
While the current geopolitical environment may continue to affect short-term sentiment, it also reinforces the importance of focusing on businesses that combine scale, operational discipline, and strong market positioning. Our portfolio companies such as Mobile World Corporation (MWG), Masan Group (MSN), and Phu Nhuan Jewelry (PNJ) illustrate how leading businesses can benefit from consolidation, formalization, and sustained demand across both essential and discretionary segments.
Despite near-term volatility, we expect the consumer sector to remain one of the most consistent drivers of earnings growth in Vietnam over the coming years. Momentum is expected to be built on stronger fundamentals, clearer earnings visibility, and more sustainable long-term outlook.
For more topics in the “Kenno at VAD 2026” series, please visit our blog section. Most recently, we covered updates on the stock market upgrade. If you have any questions or would like to discuss investing in Vietnam, feel free to reach out to us.