Total retail sales reached 877.5 trillion VND (45 billion USD) in the first seven months of this year, a rise of 26.4 percent against the same period in 2009.
The General Statistics Office's seven-month retail report showed that foreign investment contributed 25.2 trillion VND (1.3 billion USD) to the economy, 2.9 percent of total retail sales, an increase of 43.4 percent over the corresponding period in 2009.
State-run businesses saw an increase in retail sales of 41.5 percent, while non-State firms' growth was 42.2 percent.
Truong Quang Hoai Nam , head of the Domestic Market Department at the Ministry of Industry and Trade, said foreign investors consider Vietnam as a promising investment destination.
Meanwhile, global ratings agency AT Kearney predicted that Vietnam 's retail industry would grow over the next few years and that consumer spending would rise above its current level of 70 percent of a household's income.
Nguyen Thi Hoang Thuy, director of Mutrap III Programme, said the retail and distribution industry has contributed 14 percent towards the country's gross domestic product since Vietnam became a member of WTO.
However, Thuy said accession to the world trade body has not brought the anticipated influx of foreign retail investment. "A revision of [the retail] market is needed," Thuy said.
Nam said the legal framework governing the retail industry is insufficient and has resulted in investor hesitancy.
On the other hand, he said domestic investors are almost gung-ho in their approach.
"The development of the domestic retail industry seems spontaneous," he said.
Vo Tri Thanh, deputy head of the Central Institute for Economic Management, was optimistic about Vietnam 's retail sector, which he predicted would grow strongly over the next 10-15 years.
However, corporate competitiveness should be improved to achieve this growth .
In the first seven months of this year, retail sales from services were worth 78.8 trillion VND (4.04 billion USD), up 22.1 percent over the same period in 2009. Retail turnover in the hotel and restaurant industry alone generated 96.03 trillion VND (about 5 billion USD).
The Ministry of Industry and Trade said it expects retails sales this year to grow 22 percent year on year to 78.9 billion USD./.