Vietnam - Tourism grows in anxiety

LookAtVietnam - The tourism market in the first seven months of the year was a multi-colored painting. Contrary to all predictions, domestic and outbound tours prospered, while inbound tours were unsatisfactory.

Economic laws did not cover domestic market

The tours to Nha Trang City always attract travellers Travel firms have breathed a sigh of relief when finishing the summer tourism season – the most important period for domestic traveling. Despite the high inflation rate, which forced people to fasten their belt, and despite the tour fee increases, Vietnamese people still spent money on traveling domestically and abroad.

According to the Vietnam National Tourism Administration (VNAT), in the first half of 2011, the number of domestic travelers increased by 500,000 in comparison with the same period of the last year to 17.5 million. There have been no official statistics about the outbound tourists, but travel firms have said that the figure must be relatively high. Thailand and Singapore, the two most favorite destinations for Vietnamese people, receive thousands of Vietnamese tourists every year. The flights to the countries in summer are always full of Vietnamese travelers.

Surprisingly, the tours to the US and Europe, which are always expensive and believed to fit high income earners only, witnessed very high growth rates. Some travel firms have reported the high growth rates of 30 or 50 percent for the markets.

The Hoan My Travel Firm, for example, in May-July, organized tours for 8 groups of tourists (40 tourists for each group) a month, while the tour fee was higher by 10 percent than that of the previous year. In general, a tour to the US costs 70 million dong, but they still had numerous customers.

“The number of travelers to the US is double this summer,” said Nguyen The Khai, Director of Hoan My.

With Viettours, the tours to the US are still organized regularly, while the tours to Europe have seen the high growth rates of 40-50 percent. About 90 percent of clients were from businesses.

“The economic downturn has forced businesses to cut down expenses, but pharmacy, tobacco or oil and gas companies still booked expensive tours for their staff or important clients,” Luu Dinh Phuc, Viettours’ Director, said.

A director of a travel firm in district 3 said the number of tourists to Europe increased by 30 percent in summer. His firm serves 3-4 groups of tourists a month, with 30-40 tourists for each group, mostly businessmen.

Vietravel has also reported that the tours to the US, Europe and South Korea are leading in terms of the growth rate, about 40 percent.

Explaining the high growth rates, experts say that the current difficulties do not much effect high income earners – the main clients of tourism. Therefore, the demand remains high. Especially, high income earners now tend to travel to farer destinations, the US or Europe, instead of neighboring countries.

Khai said that the tour to Russia costs more than 100 million dong, but it still can attract travelers. “High income earners are interested in new destinations, even though they have to pay more money,” Khai said.

Inbound tours not attractive

In 2010, travel firms were joyful to inform that they witnessed a considerable increase in the number of MICE (meeting, incentives, conference, and exhibition) tourists. However, the good scenario does not repeat this year. The number of foreign tourists from many markets decreased slightly. Meanwhile, the number of tourists from Japan and China did not decrease, but the spending of the tourists in Vietnam decreased.

The five star New World Saigon has reported that the hotel room occupancy rate in July was 67 percent, nearly the same with the rate of the same period of the last year. At present, the hotel does not have many big MICE groups of tourists as previously (200-300 tourists per each group). It now only has small groups.

Travelink has reported that the number of tourists from Singapore and Malaysia only increased slightly by several percents. Meanwhile, the number of Chinese travelers has dropped by 50 percent. A lot of groups of tourists, who asked for information about the tours, have not confirmed their tours yet.

Source: TBKTSG

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