The report "Vietnam at a glance: Tourism - a part of salvation" published by HSBC said that, after reopening in March 2022, the domestic tourism sector of Vietnam has recovered strongly, however, international tourism, which accounts for 60% of tourism revenue, has not ye
However, there are still good reasons for Vietnam to expect a stronger recovery, especially after China reopens.
After reopening in 2022, Vietnam easily surpassed the target of 60 million domestic visitors in the year. The actual figure is over 100 million domestic arrivals.
In 2022, Vietnam welcomed 3.6 million international tourists, mainly from Korea (26%) and the US (9%).
However, international tourism has only partially recovered with the number of tourists reaching 3.6 million, only 20% of the level of 2019. That underscores the significant potential for services to continue to grow amid slowing global demand for goods.
In 2023, the government aims to attract 102 million domestic tourists and 8 million international visitors, with tourism revenue expected to grow by more than 30%. One point to note is that total tourism revenue used to be as high as 10% of GDP in 2019.
The good news is that mainland China, which is the largest source of tourists for Vietnam in the pre-pandemic period, has recently begun the reopening process, further facilitating the growing tourism industry of Vietnam. Although this take place gradually, its the impact on the Vietnamese economy will be huge in many ways.
With a large proportion of Chinese tourists (30%), Vietnam will probably also be a big beneficiary in the region, just after Thailand.
If flight restrictions can be resolved and visa requirements are further eased, it is believed that the return rate of Chinese tourists may be about 50-80% of pre-pandemic levels.
Besides, penetrating into new markets will be a central issue for Vietnam, with various initiatives such as launching tourism promotion programs to pave the way to emerging markets like India - a country with a growing footprint in Vietnam's international tourism industry.
Easier travel also facilitates deeper travel connections. Specifically, Indian tourists accounted for 4% of Vietnam's total visitors in 2022, up from just 1% in 2019.
Vietnam is considering easing visa policy further. Currently, Vietnam does not exempt visas for major markets including mainland China, the US and Australia, while European countries are exempted from visas, but the stay period is only 15 days.
Obviously, compared to other countries, access to the visa-free regime is still relatively tight in Vietnam. Fortunately, this situation is likely to change.
Officials are considering increasing the visa-free period to 30 days and rolling out electronic visas for citizens from all countries and territories.
Another way to facilitate tourism is by diversifying tourism products. Sports tourism, a tourism segment within the tourism industry vision of the Vietnam National Administration of Tourism, can also help attract high-spending travelers.
The level of development of tourism facilities in general is also very encouraging. According to the Vietnam National Administration of Tourism, the supply of high-end accommodation continues to grow with the number of 4-5 star standard establishments increasing by an average of 12% per year before the pandemic.
After the pandemic, several global hotel chains have been actively looking to open new facilities in Vietnam, reflecting Vietnam's attractiveness in other fields than just manufacturing.
While international tourism is gradually recovering, domestic tourism continues to be vibrant and bustling. Tan Son Nhat Airport served more than 149,000 passengers on January 27, easily breaking the record of 128,000 before COVID-19 during Tet.
Alice Hoang Thao – VietnamCredit