France-based Auchan, one of the world’s largest hypermarket chains, plans to invest 500 million USD over the next decade in Vietnam, after many years absent from the country.

Economists have described the group’s return as tinder that fuels the country’s hot retail market.

Founded by Gerard Mulliez, one of the wealthiest people in France , Auchan has presence in 15 countries across the world and is expanding in China, Russia and Eastern Europe, according to Business Week.

Earlier this year, E-mart, a subsidiary of Shinsegae – one of the leading retailers of the Republic of Korea (RoK), partnered with U&I Group in southern Binh Duong province to set up a joint retail venture in Vietnam worth 80 million USD.

The RoK group expects to establish 52 supermarkets and outlets by 2020 with total investment amounting to 1 billion USD.

E-mart Sales Director Ja Young Heo describes Vietnam as an ideal destination for RoK investors, especially in the fields of retail, logistics and household utensils.

Last year, the group imported over 7.88 million USD worth of products from Vietnam, she said, noting that the group’s online sales turnover in Vietnam reached 89 million USD in 2012.

Last year also saw an influx of investment from Japanese companies Aeon and Takashimaya.

Aeon is building Celado Shopping Mall, which will be the largest hypermarket in Ho Chi Minh City , and another hypermarket in Binh Duong province at the same time.

The group has also worked with Trung Nguyen Group to set up 13 Ministop convenience stores in HCM City.

Takashimaya, a leading Japanese retailer, will operate on a site of 15,000 square metres in the Saigon Centre in 2015.

Other retailers that have gained a firm foothold in Vietnam such as Metro Cash & Carry, Big C and Lotte are also devising plans to expand their operations in the country.

With 17 commercial centres running successfully in Vietnam over the past ten years, Metro strives to open another 30-35 stores in the next 3-5 years.

Domestic firms are also seeking ways to compete in the modern retail market, which is traditionally dominated by foreign groups.

Co.opmart has joined hands with NTUC FairPrice of Singapore to establish a chain of hypermarkets called Co.op Xtra Plus in Ho Chi Minh City.

According to Saigon Co.op General Director Nguyen Thi Hanh, the move marks an important milestone in the group’s retail market development strategy.

Maximart, which has been operating in Vietnam for 17 years, is also working with Dairy Farm of Hong Kong.

Sharing successful experiences in Vietnam, foreign firms place special emphasis on geographical location, advantages in business and strong partners.

Vietnam now has 717 modern retail outlets and 8,600 traditional markets. However, the percentage of retail stores in the country remains below 20 percent, much lower than that it other countries in the region such as Indonesia , Thailand , Malaysia and China.

The Ministry of Industry and Trade expects that by 2020, the country will have 1,200 supermarkets, 157 shopping centres and 180 trade centres.

Registering a growth rate of 14.8 percent in 2007-2012, the country’s purchasing power was forecast to attain a value of 89.7 billion USD by early this year.

In 2013-2015, retails revenues are forecast to grow 8.5 percent a year averagely.-VNA