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Tourist arrivals plummet in Vietnam as global downturn bites

Expedited visa application process can boost tourism revenues by 10 percent, an expert says
Vietnam is set to miss its target of attracting five million international tourists this year as arrivals have dropped off sharply, industry officials say.


Hotels and tour operators are struggling and dropping their rates amid the steepest fall in arrivals since the 2003 SARS crisis and then bird flu outbreaks a year later that scared tourists away from Vietnam and other Asian destinations. This time, the global economic downturn is the main factor.

Next year, the tourism sector – which employs more than 10 percent of Vietnam’s workforce – faces zero growth or worse, Minister of Culture, Sports and Tourism, Hoang Tuan Anh, warned at a Hanoi conference last week.

The Vietnam National Administration of Tourism (VNAT) has asked the government to spend US$20-30 million on a global marketing campaign to draw back visitors next year and after.

VNAT said such a campaign, which would follow a smaller advertising campaign on CNN and the Discovery Channel, could be financed from a newly-announced one billion dollar economic stimulus package.

“The number of international arrivals has been down for months, but the situation has seriously worsened since October,” said Vu The Binh, a senior official at VNAT.

That month, fewer than 300,000 international visitors arrived in Vietnam, a drop of almost 12 percent since October last year, according to VNAT figures.

By November, arrivals were down 22 percent year-on-year, part of this was due to the shutdown of Thailand’s airports by protesters.

Despite strong growth rates early in 2008, only 3.87 million tourists have come to Vietnam in the year to November, with arrivals from the US, Japan, South Korea and Taiwan all down, the tourism ministry said.

“We forecast that arrivals in 2009 will fall 20-30 percent from 2008 because of the global economic crisis,” said Binh. “So we need to invest more in tourism products to make them return to Vietnam in late 2009 and 2010.”

Tourism operators have echoed the complaints.

“Our clients from the US and Europe, especially France, Britain and Germany, have been down since midyear,” said Nguyen Hang Quy of Huong Giang (Perfume River) travel agency in the former royal capital of Hue.

“It’s because of the international downturn,” he told AFP. “And 2009 will be more difficult. We are now trying to seek out new markets in Asia.”

Tourism accounts for 4.5 percent of Vietnam’s emerging economy and had been forecast to generate 3.7 billion dollars this year. The sector makes up 10.8 per cent of the workforce of its 86 million people.

A conference in Hanoi early this month was told that Vietnam could boost tourism revenues by at least 10 percent if it eased up visa regulations and expedited the process through online applications and visas-on-arrival.

The cumbersome visa application process was the “largest obstacle to establishing Vietnam as a global destination,” said a Tourism Working Group paper presented by Baron R. Ah Moo, the CEO of Indochina Hotels and Resorts.

“Due to the processing time... last-minute travel to Vietnam is not an option and has been replaced by weekend trips to Phuket, Bali, Macao and Singapore,” he said in a paper he presented at the Vietnam Business Forum.

Source: AFP