Travel and Tourism - Vietnam
Euromonitor International : Country Market Insight
April 2010

Travel And Tourism Vietnam
List of Contents and Tables
TRAVEL AND TOURISM IN VIETNAM........................................................................................1
Executive Summary..............................................................................................................................1
Still Faced With Inflation and Fuel Price Growth..............................................................................1
H1n1 Epidemic Affects the Tourism Industry All Over the World.......................................................1
More Policies To Attract Tourists......................................................................................................1
More Luxury Hotels Springing Up.....................................................................................................1
Vietnam Tourism Hopes To Recover in 2010.....................................................................................1
Key Trends and Developments...........................................................................................................1
Impact of the Global Recession..........................................................................................................1
H1n1 Flu Pandemic...........................................................................................................................2
Legislative Environment – Vietnam Offers VISA Exemption for Diplomatic Passport and Special
Public Service Passport Holders.......................................................................................................3
Inequality Distribution of Hotels Across the Country Poses Problems...............................................4
Homestay and Vietnamese-cuisine-cooking Tours Are Becoming More Popular................................5
Arrivals by Sea Start To Increase Again............................................................................................6
Demand Factors....................................................................................................................................7
Balance of Payments.............................................................................................................................7
Market Indicators.................................................................................................................................7
Table 1 Leave Entitlement: Volume 2005-2009..........................................................................7
Table 2 Holiday Demographic Trends 2004-2009......................................................................8
Table 3 Holiday Takers by Sex 2004-2009.................................................................................8
Table 4 Holiday Takers by Age 2004-2009.................................................................................8
Table 5 Length of Domestic Trips: 2004-2009...........................................................................8
Table 6 Length of Outbound Departures: 2004-2009..................................................................8
Table 7 Seasonality of Trips 2005-2009......................................................................................9

before being able to board. People have also cut back on travelling for fear of catching H1N1, reducing the
number of tourists.
More Policies To Attract Tourists
The government has implemented several initiatives to attract more tourists to Vietnam, such as hotels (mostly
luxury hotels) and tourist agents all over the country offering lower prices. Some leading travel agencies such as
SaigonTourist and Vietravel have reduced their prices by up to 30% for tours to major tourist destinations in
Vietnam. Hotels and travel agencies have also increased the service quality such as room service, car rental, and
airport transfers. Some provinces are chosen to host festivals like the sea festival at Nha Trang, fruits festival at
Can Tho, and the Mekong festival. These festivals last a few days and there are a lot of activities like parades,
concerts and exhibitions to attract more tourists. These are traditional festivals but they were previously on a
small scale and celebrated only by locals. Since 2005, the government has made them into big events spanning
several days, with a lot of activities to attract more tourists. Although they seemed to be fascinating for the
tourists initially, the festivals just repeat themselves every year offering nothing new and many tourists feel that
the festivals are becoming too commercial and have lost their spirit. This is the reason why the number of
tourists drawn to these festivals is declining every year.
More Luxury Hotels Springing Up
Many international corporations have recognized the promising tourism business in Vietnam and decided to
invest. Many luxury hotels are being built and existing ones are going through renovation. Vietnam’s first six-
star hotel is being built in Vinperland, Nha Trang and is said to go into business at the end of 2010. However,
there tends to be a mismatch in locations of luxury hotels. Tourists prefer travelling to mountainous and quiet
areas such as the highlands, Sapa, and the countryside, but the hotel rooms in these areas are often all booked
well in advance.
Vietnam Tourism Hopes To Recover in 2010
With good medical attention, most H1N1 swine flu cases took one week to recover. According to the WHO,
travelling restrictions are not necessary. In 2010, the H1N1 epidemic will have been controlled and the global
financial crisis should begin to lessen. Travel and tourism will recover and tourists will come back to Vietnam,
putting the industry in a good position to gain further revenues in the longer term.
KEY TRENDS AND DEVELOPMENTS
Impact of the Global Recession
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by this time. It is predicted that Vietnam’s economy will completely recover by June 2010.
Future Impact
Along with the recovery of the economy, Vietnam’s travel and tourism industry will gradually increase as
tourism is the economic indicator of Vietnam and generates a large percentage in GDP. It is predicted that
Vietnam’s GDP in 2010 will grow at 6.5% and continue to grow positively until 2014. People will start to travel
more, especially at the time of 2010’s Lunar New Year (mid-February).
However, the prices of rooms will not increase or will only increase slightly because they do not want the
tourists to be put off by such a sudden increase. If prices rise suddenly, tourists may opt to stay at budget hotels.
Transportation is important to the travel and tourism industry and there are only a few airlines in Vietnam.
Therefore, their sales will start to go up and soon will recover completely.
H1n1 Flu Pandemic
H1N1 (also called Swine flu) is a new kind of virus that has never before been circulated among humans. Swine
flu started in Mexico in March 2009 and quickly spread to other countries and continents as people travelled. On
11 June 2009, the World Health Organization (WTO) announced Swine flu as phase 6 (which means it is
considered a pandemic). Until 4 October, according to WTO’s update report number 69 about H1N1, there have
been 375,000 cases of Swine flu and 4,500 deaths all over the world. As for Vietnam, according to the statistics,
there have been over 5,000 cases with six deaths. Research is being taken in order to find a vaccine for Swine
flu but in the mean time, every country and person has to follow some safety instructions to reduce the spread of
the pandemic.
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Travel And Tourism Vietnam
Current Impact
The outbreak of H1N1 has had a great impact on the tourism industry, not only of Vietnam but other countries
as well. Even though the WTO has confirmed that travel restrictions are not necessary, people are still restrained
from travelling as a means of safety. Vietnamese tend to worry a lot about small problems. Therefore, when
Swine Flu broke out, it caused panic everywhere. People went everywhere with masks; even in offices and
schools. If someone had a mild cold and coughed, people would assume that he/she had Swine Flu and took that
person to the hospital for medical isolation. Vietnamese were even scared of foreign tourists for they thought
that international tourists were the ones who brought the Pandemic to Vietnam in the first place. In Vietnam, at

that this policy will help attract more tourists since they do not need to wait at the check-in desks for such a long
time like before.
Current Impact
Since Swine Flu was still all over the news and causing panic everywhere in Vietnam, Vietnam government’s
promotional campaign was a smart step to attract more tourists to save the decreasing industry. And as a result,
more tourists came to Vietnam during summer vacation than any other time of the year.
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Travel And Tourism Vietnam
The act of providing free visa for diplomatic passports and special public service passports was a good way to
develop business tourism (or MICE- Meeting Incentive Convention Exhibition) which has become a promising
area in many other countries in recent years. MICE tourists not only stay in luxury hotels but also spend more
on shopping and travelling to many other places in the country. Towards the end of the review period, Vietnam
government has taken steps to attract more MICE tourists. As a result, during the first six months of the year
2009, the number of business arrivals increased by 30% (MICE increased by 35%). However, because of the
Swine Flu Pandemic, the number has gone down dramatically for the whole of 2009.
Outlook
Vietnamese government is taking steps to sign more agreements on free visas for diplomatic passport and
special public service passport holders with many countries across Europe and also the US. These agreements
will come into effect in 2010.
With the tendency of international trade and cooperation, Vietnam’s government will issue more free visas to
tourists coming from some countries in Europe and from the US. This needs a lot of consideration as the more
free visas are given, the more risks that the country faces in terms of illegal migrants. Vietnam’s legislative
system still has some loopholes that illegal immigrants can exploit. Since 2008, Vietnam has faced illegal
immigrants mostly from some African and Asian countries coming to Vietnam to commit fraud , launder
money, or withdraw money with fake credit cards. This is a very serious problem that the Vietnam government
still cannot solve.
Future Impact
Due to the policies of giving free visas for diplomatic passports and special public service passport holders,
Vietnam is going to establish good relationships with many countries in the world. This is also an advantage to

It is also a very difficult problem because if people build many hotels in those mountainous areas, it will destroy
the natural beauty of it and tamper with the lives of the ethnic groups. But if they do not build hotels in those
areas, Vietnam will lose a lot of tourists. Some travel agencies do offer tours in which tourists can stay and join
the lives of the ethnic people. However, those tours are just for a small number of tourists as there are not
enough places in the villages to accommodate many tourists.
The inequality in distribution of hotels is becoming bigger. In 2009, there were 88 new hotels built in coastal
areas. Meanwhile, there were only five new hotels in mountainous and country areas. The shift of tourists’
preference from big cities to much quieter places causing a shortage in hotels. In high-peak season, like Tet
holiday or summer vacation, all the hotel rooms are booked well in advance while in big cities many of the hotel
rooms are available.
There is also an inequality in distribution of luxury hotels. There are about 31, 5-star hotels in Vietnam in 2009;
21 of which are located in Ha Noi, the capital city and Ho Chi Minh City. There is a shortage of luxury hotels in
other cities; tourists who visit those cities have to stay in mid-sized or budget hotels with old-fashioned rooms
and poor customer service.
Outlook
It is a big regret that Vietnam cannot accommodate tourists for longer in those areas. The beauty of the scenery
is one very distinct advantage that Vietnam has over other countries. It is also a very good way to introduce the
country’s various culture and natural and “untouched” beauty to the world. Vietnam needs to solve the problem
of how to develop tourism in mountainous areas whilst preserving its natural beauty.
Tours to the countryside to experience the lives of Vietnamese farmers are also a really good idea. Tourists can
enjoy the fresh and peaceful air with no noise, traffic jams or worries about work or school and at the same time
experience how farmers work in the fields or harvest crops. Some travel retailers such as SaigonTourist and
Vietravel are organizing some of those tours as an experiment and received a lot of good response from tourists.
Future Impact
The inequality of distribution of hotels among big cities and mountainous areas will remain great in the future as
more hotels are being built in big cities and coastal areas. No one would take the risk of investing in
constructing new hotels in mountainous and country areas for fear they will not be able to gain profits. If this is
the case, Vietnam will lose a large number of tourists and credit.
Currently, more luxury hotels are being built in Da Nang, Nha Trang and some other tourist cities. Therefore, in
the future, hopefully, Vietnam will attract more tourists to Nha Trang, Da Nang and Phu Quoc, etc, the

MICE tourists. Local hosts will arrange the interesting classes for their foreign counterparts to experience the
Vietnamese food culture.
Meanwhile, it is expected that the number of tourists going on homestay tours will increase too, so as to
experience the most authentic Vietnamese culture.
Arrivals by Sea Start To Increase Again
With over 3,269 kilometres of coastline, seaport systems and many beautiful beaches from North to South,
Vietnam has every potential to develop tourism. Over the 1999-2002 period, Vietnam’s cruise tourism
developed rapidly, with an average of 200,000 tourists going on luxury cruises every year. Since 2003, the
cruise tourism in Vietnam has decreased due to SARS, Tsunami and Bird Flu. In 2008, the arrivals to Vietnam
by sea started to develop. In 2009, despite the pandemic and economic crisis, the number of tourists coming to
Vietnam on cruises did not appear to decline.
Current Impact
Since the beginning of 2009, Vietnam has greeted many luxury “floating” hotels with about 234,200 tourists
onboard; a slight increase on 2008. Only around 7% of which are business sea arrivals, and the remaining 93%
leisure sea arrivals. On 2 November 2009, the luxury vessel named Costa Classica, came to Vietnam for the first
time. This was also an experimental cruise to make regular cruises fortnightly to Vietnam during the forecast
period. Costa Classica, one of the luxury vessels of Costa Crociere Corp’s fleet, is 200m long and can carry
2,000 tourists and crew. Costa Crociere Corporation, affiliating with SaigonTourist brought two vessels named
Costa Allegra and Costa Marina to Vietnam before April 2009. This is very good news for Vietnam because
Costa Crociere Corp is one of the biggest sea tourism corporations in Europe.
Tourists going on cruises are often elderly people who have a lot of time and money and would like to learn
about Vietnam’s culture and history. Each tourist going on a cruise is said to spend about US$300-400 per day,
which is about 20-30% more than tourists coming by air or land.
Outlook
With the affiliation between SaigonTourist and Costa Crociere Corp, Vietnam will have a regular number of
tourists on cruises in the future. Most tourists coming on Costa Crociere’s vessels are Italian, French, German
and Spanish. Therefore, with well-organized tours, high quality service and the right policies from the
government, Vietnam could attract more tourists from Europe.
Future Impact
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expenditure of Vietnamese tourists on outbound tours decreased much more. Therefore, in general, Vietnam’s
balance of payments in the year 2009 increased by 6%. In 2009, due to the global recession, fuel prices
increased making prices of other products increase. With the same amount of money, people can buy fewer
products. Therefore, Vietnamese people travelling abroad shopped less and concentrated more on getting to
know the destination country’s culture and history making the expenditure decrease.
MARKET INDICATORS
Table 1 Leave Entitlement: Volume 2005-2009
number of days
2005 2006 2007 2008
Paid Holiday 12.0 12.0 12.0 12.0
Public Holidays On Working Days 5.0 8.0 9.0 9.0
Public Holidays Not On Working 3.0 5.0 3.0 1.0
Days
Leave Entitlement 20.0 25.0 24.0 22.0
Source: Euromonitor International
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