Now that it has recovered, how can Vietnam's tourism industry accelerate its growth?

Golden Bridge - Sun World Ba Na Hills

Tourism has made a spectacular recovery.

In August 2023 alone, Vietnam received 1.21 million international tourists. This was also the highest number of international visitors Vietnam had received since the beginning of 2023. In the first eight months of 2023, Vietnam received over 7.83 million international visitors. With this achievement, Vietnam's tourism sector has almost reached its target for the entire year of 2023.

Not only has Vietnam received optimistic signals regarding the recovery of the international tourist market, but its tourism sector has also continuously received recognition from the international community. More than 40 World Travel Awards (WTA) 2023 for the Asia-Oceania region were recently awarded to Vietnam, demonstrating the increasingly important position of Vietnamese tourism in the region. Sun Group alone made its mark at WTA 2023 with 5 awards in the Asia-Oceania region, including the Leading Tourism Group in Asia 2023 award.

"Vietnam is increasingly becoming a truly great destination, possessing all the qualities to become the number one market in the world's tourism industry. Vietnam's greatest asset lies in its stunning natural beauty with a coastline stretching over 3,000 km and its friendly, hospitable people. In addition, Vietnam also boasts high-quality resort products. You have learned how to leverage all of this to elevate your tourism industry," said Graham Cooke, President of the WTA.

Beaches in Phu Quoc

These signals demonstrate that Vietnam's tourism industry is on the path to an impressive recovery after the severe impact of the Covid-19 pandemic. However, this recovery is still modest compared to the pre-Covid-19 period, or compared to the growth rate of neighboring countries.

Compared to the first nine months of 2019, when the number of international visitors to Vietnam reached nearly 12.9 million, this year's figure still has a long way to go. Looking at neighboring Thailand, in the first nine months of 2023, it welcomed 19 million visitors, more than double Vietnam's achievement. The island nation of Singapore, with an area only slightly larger than Phu Quoc Island, has set a target of 12-14 million international visitors this year.

With the achievements already made, Vietnam's tourism sector is sure to surpass its targets by the end of the year. However, to break through and reach the 18 million international visitors seen in 2019, or to catch up with some of the region's tourism powerhouses, Vietnam still has a long way to go.

And the story of a top tourist destination experiencing a lack of visitors.

Furthermore, in the post-pandemic period, Vietnam continues to face numerous obstacles hindering tourism development. The most prominent example is the recent decline in visitors to Phu Quoc, a destination praised by international media as the Maldives of Vietnam, boasting high-quality infrastructure for entertainment, relaxation, and convenient transportation. However, while other destinations like Da Nang, Sa Pa, Quang Ninh, and even emerging destinations like Tay Ninh are always bustling with domestic and international tourists during holidays or peak summer seasons, Phu Quoc is experiencing a slump, with a continuous drop in visitor numbers.

According to statistics from the Kien Giang Department of Tourism, in August 2023, Phu Quoc is estimated to have welcomed 544,945 visitors (a decrease of 15.2% compared to July), including an estimated 40,080 international visitors (a decrease of 25.5% compared to July); total revenue reached approximately 1,140 billion VND (a decrease of 20.6% compared to the previous month). The number of overnight visitors in Phu Quoc in both July and August decreased compared to June, with August seeing a 14.6% decrease compared to July.

Ms. Tran Nguyen, Deputy General Director of Sun World, shared: "Phu Quoc is a destination with many favorable conditions for tourism development, from natural conditions, good products, an international airport, visa exemption policy for international visitors… Sun Group itself has also invested a lot of effort in creating the most upscale and high-quality products here. However, the number of visitors to Phu Quoc in recent times has been truly disappointing. The number of visitors to our amusement parks has also decreased by 30-50% compared to the same period last year."

One of the main reasons why Phu Quoc is becoming increasingly unpopular is the exorbitant price of airfare. At one point, the cost of a round-trip air ticket to Phu Quoc was equivalent to the price of an entire trip to Thailand, China, or Singapore.

Furthermore, many opinions reflect that an equally important reason is the increasingly unstable and uncivilized tourism environment in Phu Quoc, discouraging tourists from returning. Local people still lack awareness of tourism practices, with fragmented approaches and rampant price gouging. Marine litter is also a pressing issue, causing the island to lose appeal. These are problems that Phu Quoc needs to address directly in order to improve and regain its appeal to tourists, especially given its unique advantages.

Relax visa requirements, increase promotion.

These are two bottlenecks, but they also represent areas for further improvement in attracting tourists in the future. According to tourism experts, one of the key factors driving the tourism recovery in recent times is the improved visa policy. The National Assembly recently provided significant support to the tourism industry by extending the validity of e-visas to 90 days and increasing the unilateral visa-free stay period to 45 days. This has given a boost to the green economy sector, enabling a faster recovery. However, in reality, compared to the extremely liberal visa policies of Thailand (visa-free for 64 countries and territories), Singapore, and Malaysia (visa-free for 162 countries and territories)... Vietnam still lags behind, making it difficult to compete or even think about narrowing the gap in terms of international tourist growth.

Phu Quoc is facing many difficulties that are hindering the recovery and growth of tourism.

Most recently, at the end of September, Thailand extended its visa-free entry policy for Chinese and Kazakh tourists for five months as a way to attract more visitors for the upcoming busy holiday season. Tourists from these two countries can enter Thailand without a visa until February 29th of next year and can stay for a maximum of 30 days at a time. The visa waiver aims to further encourage the return of Chinese tourists, the largest group of visitors to Thailand before the pandemic.

Thai authorities believe that the costly and cumbersome visa application process faced by tourists after the pandemic is the main reason for the lower number of visitors after the Covid-19 restrictions ended. According to Thai airports, the number of Chinese tourists is projected to reach 589,993 in October, 61% higher than the 365,980 expected in September, due to airlines increasing the number of flights.

Official data shows that the number of Chinese tourists to Thailand has reached 2.3 million this year, falling short of the government's annual target of 5-7 million. The Tourism Authority of Thailand (TAT) forecasts that at least 5 million Chinese tourists will visit Thailand by the end of this year after the government's visa-free policy for China and Kazakhstan comes into effect.

Looking at Thailand, as well as many countries in the region and around the world, visa exemption has always been an important weapon to attract international tourists, and Vietnam can use it to improve its still modest number of visitors.

Furthermore, in the post-Covid-19 pandemic period, tourism promotion and marketing activities are considered crucial in attracting tourists, establishing brand positioning, and developing potential markets. However, since the beginning of the year, while Thailand, South Korea, Japan, and China have continuously organized numerous tourism promotion events in Vietnam, our country has had almost no tourism promotion activities abroad, except for cultural festivals or art programs organized by diplomatic delegations at the head of state level.

Representatives of Sun Group receive the award at the WTA Asia-Oceania regional awards ceremony.

"In the post-Covid-19 recovery phase, promotion and marketing are considered one of the most important weapons in the race for all destinations. However, Vietnam's current promotion and marketing efforts, as well as those of other destinations, have not been adequately invested in. We lack a well-structured national destination promotion campaign. Some of Vietnam's key markets have not received priority investment in promotion, only having small-scale promotional activities by businesses or localities, thus demonstrating fragmentation and a lack of overall coherence. This is a disadvantage for Vietnamese tourism," Ms. Tran Nguyen frankly stated.

Not only is promotional activity in the international market limited, but domestically, the upgrading and development of destination promotion channels at the central and local levels in the languages ​​of key international tourist markets is also fragmented and unprofessional, making it difficult for international tourists to find information about services, destinations, and experiences.

It is known that the Government has assigned the Ministry of Culture, Sports and Tourism to review, research, and adjust the target for receiving international tourists in 2023 to suit the actual situation in order to further promote the recovery and development of tourism. Many experts believe that the Vietnamese tourism industry will continue to conquer new targets if it knows how to take advantage of opportunities from now until the end of the year to accelerate and regain the growth momentum as before the pandemic. However, for sustainable development and long-term breakthroughs, the tourism industry needs comprehensive and long-term solutions, removing major obstacles to pave the way for tourism to take off.

The number of international visitors to Vietnam is only 69% compared to before the pandemic.

According to the General Statistics Office (Ministry of Planning and Investment), in September 2023, the number of international visitors to Vietnam reached over 1 million, a decrease of 13.4% compared to August and 2.4 times higher than the same period last year. Meanwhile, the number of Vietnamese citizens leaving the country reached 501,400, an increase of 43.1% compared to the same period last year. Overall, in the first nine months of 2023, the number of international visitors to Vietnam is estimated at 8.9 million, 4.7 times higher than the same period last year, but still only 69% of the number in the same period of 2019 – a year before the Covid-19 pandemic; the number of Vietnamese citizens leaving the country reached 3.8 million, 2.5 times higher than the same period in 2022.

Vietnam's tourism visitor target and recovery rate are the lowest among the top 5.

According to the World Tourism Organization, Vietnam's 2023 international visitor target, or the tourism recovery rate compared to 2019, is the lowest among the top 5 most popular destinations in Southeast Asia. Before the pandemic, the top 5 countries in the region were Thailand (39.8 million visitors), Malaysia (26.1 million), Singapore (19 million), Vietnam (18 million), and Indonesia (15.5 million). In 2023, Vietnam aims to welcome 8 million visitors, representing a 44% recovery compared to pre-pandemic levels, but the other 4 countries have all set higher targets.

Specifically, Thailand initially projected 25 million tourists. After China reopened its borders in January, the Thai government revised its target, projecting 28-30 million visitors. Thus, the country's recovery target compared to pre-pandemic levels is set at 63-75%. Malaysia projected 16-18 million visitors, pushing its recovery target up to 69%. Singapore projected 12-14 million visitors, equivalent to a recovery level of 63-73%. Indonesia initially projected 7.4 million visitors but raised its target to 8.5 million in July. The recovery rate increased from 46% to 53%, demonstrating the country's determination to welcome international tourists.

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