Asia continues to be the main driver of retail growth globally.
And according to a report from PwC, the region holds the best opportunity for growth and profits for many international retail and consumer companies.
Retail sales in Asia Pacific are forecast to grow six per cent this year and will maintain this upward momentum through 2016 with an estimated market worth of US$11.8 trillion, says PwC.
Major international retailers will continue to expand in Asia, with more tailored strategies being introduced in China. By 2016, China will overtake the US as the world’s largest retail sales market, worth some US$4.2 trillion.
India, too, is now attracting considerable interest, after its government announced last year that it would permit FDI of up to 51 per cent in multi-brand retailing.
Malaysia’s retail sales volume is expected to climb to 5.7 per cent in 2013 and range between 4.8 per cent and five per cent for the rest of the forecast period, underpinned by improving consumer confidence.
Singapore’s retail sales are predicted to rise 2.7 per cent this year, and grow at a better pace each year, reaching 5.3 per cent by 2016.
As export growth and the economy pick up in South Korea, retail sales volume growth will recover to 2.1 per cent this year.
In Thailand, retail sales will rise by 6.9 per cent in 2013 and by between 4.7 per cent and 5.3 per cent through the rest of the forecast period, says PwC. Demand will be supported by rising incomes.
Given a more benign climate from 2013, both at home and worldwide, Vietnam’s GDP growth will pick up to 6.9 per cent a year on average in 2013-2016, when inflation should slow further to an average of 7.4 per cent. Consequently, retail sales volume will surge 11.1 per cent this year and stay stronger for the rest of the period but taper downwards in 2016.
As Asia’s markets leap forward and Asian consumers come into their own, “the great Asian retail story is still being written”, said PwC. Companies, both foreign and local, have an unprecedented opportunity to help write that story, it concluded.