Tourism still waiting for foreign visitors to boost

Businesses waiting for foreign customers

The General Statistics Office has just released data showing that international visitors to Vietnam last May were estimated at 916,300, down 6.9% compared to the previous month. In the first 5 months of the year, Vietnam welcomed nearly 4.6 million international visitors, 12.6 times higher than the same period last year. Compared to the target of 8 million visitors set by the tourism industry for the whole year, it has reached 57%. Tourism industry leaders are also confident that with the current growth in visitor numbers and efforts to promote, promote, and organize attractive tourism and cultural events, Vietnam tourism can attract 10 million international visitors in 2023.

The General Department of Tourism assessed that the main growth driver for the international tourist market currently comes from China. After this country reopened group tours to Vietnam from March 15, the number of visitors in March and April reached nearly 200,000. Of which, in April alone, 112,000 Chinese visitors visited Vietnam, an increase of 62% compared to March, achieving the highest growth rate among international tourist markets.

This is also the month with the highest number of Chinese visitors in the 3 years of the Covid-19 pandemic. In addition, tourism promotion and advertising activities are being effectively implemented by relevant agencies. This has significantly increased the number of searches for Vietnamese tourism. According to data from Google, international searches for tourist accommodation in Vietnam ranked 11th in the world , in the group with an increase of 10 - 25%. Only Vietnam and the Philippines are Southeast Asian countries in the top group in the world.

Vietnam needs more breakthrough policies to strongly attract international tourists.

However, compared to the same period in 2019, the total number of international visitors to Vietnam has only recovered by about 50 - 60%. The Chinese tourist market alone is only 22%. Although they are no longer too worried about the target of 8 million visitors, most tourism businesses are looking forward to the recovery of the international tourist market because after a year of booming domestic tourism, Vietnamese people are tending to go abroad to travel, and domestic service industry revenue will face many difficulties when tourists' purchasing power is showing signs of decreasing.

Ms. TL, the owner of a 4-star hotel in Nha Trang, said that during the April 30 - May 1 holiday, the hotel and restaurant system in the coastal city recorded very good revenue, helping businesses have more money to maintain operations after a long period of difficulty. This summer, Ms. TL's hotel has also received bookings for about 70% of the rooms, spread out from now until the end of August. However, the main guests booking rooms are still domestic guests, families taking their children on summer vacations, and the booking rate can be so high thanks to the discount program of up to 30%.

"Domestic guests spend quite "confidently", if compared, it is sometimes less than 50% compared to international guests. For example, foreigners travel all day, and at night they still call the receptionist to order food or use massage and laundry services... at the hotel. Vietnamese people almost absolutely do not. My brother also works in the tourism industry, runs a chain of restaurants and a massage system along the coast, but up to now he has only dared to reopen 60% of his operations because there are not many international guests," said Ms. TL.

Despite the strong growth in tourism, the service system in Ho Chi Minh City is also facing an imbalance in the source of visitors as it still mainly depends on the domestic market. Chairman of Saigontourist Group Pham Huy Binh informed that since Vietnam reopened tourism in March 2022, the number of international visitors to Vietnam participating in accommodation, travel and other services at the Saigontourist Group system has begun to grow steadily. In the first 5 months of 2023, Saigontourist Group welcomed and served 750,000 visitors, an increase of 89.4% over the same period, of which international visitors reached 285,000, accounting for only 38% of the total number of visitors of the corporation. Although 4 and 5-star hotels in the center of Ho Chi Minh City have welcomed a higher proportion of international visitors than domestic visitors, they are still not as good as before the Covid-19 pandemic.

Expectations of breakthrough thanks to new policies

Mr. Cao Tri Dung, Chairman of the Da Nang Tourism Association, said that the slow arrival of international visitors to Vietnam is a common situation due to the difficult global economic context and weakened purchasing power after 3 years of the pandemic. Demand has not increased but supply is too large, so businesses are still facing difficulties. The tourism industry has also determined that this year and next year will not be able to escape the difficulties. In that context, new policies on attracting international tourists related to visas that are being considered by the National Assembly for application are expected to create momentum and be one of the strengths for Vietnam to increase its national competitiveness in the context that most neighboring countries have been open about visa policies for a long time.

A strong domestic market is the foundation for tourism to recover, but the factor for growth and breakthrough must be international visitors.

Mr. Cao Tri Dung, Chairman of Da Nang Tourism Association

According to Mr. Dung, when visa policies are more open and flexible, more tourists will come to Vietnam and there will be better competition for destinations. Some markets are highly sensitive such as China, if Vietnam opens online visas, the number of individual tourists and family tourists will certainly increase immediately. Before the pandemic, they were forced to travel to Vietnam through sponsoring companies and had to go on tours, so they have not yet recovered. Besides, some nearby markets can be attracted immediately if they are unilaterally exempted from visas. Faraway markets such as tourists from Europe and America have a delay of about 6 months - 1 year for them to plan and accumulate income for the trip.

"In general, if the new visa policies are approved, they will be a boost for the tourism industry to explode in the last 6 months of the year and in 2024. International visitors are still the most important source of the tourism system due to their spending level and number of days of stay. If international visitors have not recovered, tourism businesses will still have difficulties. The strong growth of the domestic market is the organic foundation for tourism to recover, but the factor for growth and breakthroughs must be international visitors," Mr. Cao Tri Dung emphasized.

Ms. Nguyen Thi Nga, Chairwoman of BRG Group, said that Vietnam needs to have more policies focusing on attracting high-spending customers to improve the "quality". The average daily spending of international visitors to Vietnam, although growing in the period 2009 - 2019, from 91.2 USD to 117.8 USD, is still very low compared to other countries in the region. Meanwhile, Vietnam has a lot of potential to develop a series of new products, such as golf tourism. In 2017 and 2022, Vietnam was honored as the best golf tourism destination and has organized the top golf tournaments in Asia. In 2019, out of 5 million Korean visitors to Vietnam, more than 1 million went golfing, bringing in billions of USD in revenue to the tourism industry. There have never been so many tourists coming to Vietnam to play golf as there are today. This is a group of customers whose spending is 2-3 times higher than normal customers. They spend an average of 200-300 USD/day, staying for 3-4 days.

"Recently, BRG's hotel in Phu Quoc organized a wedding for an Indian billionaire, earning over 7 billion VND in revenue in 5 days. We expect the Government to adjust policies and issue many solutions to attract more high-end customers who spend big and stay long term," Ms. Nguyen Thi Nga cited.

The Government needs to have more direction to implement major programs and plans focusing on tourism recovery and development. In particular, there needs to be breakthrough policies, plans, and action programs to attract international visitors, in which it is recommended that the Prime Minister or Deputy Prime Minister in charge of tourism act as the head of the steering committee. At the same time, it continues to support the resolution of business-related problems and difficulties of tourism enterprises that have been severely affected by the pandemic...

Mr. Pham Huy Binh, Chairman of Saigontourist Group

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