Rehabilitating Vietnam tourism’s growth rate

      In response to the Government’s economic stimulus, the Vietnam tourism sector has recently promulgated a national action programme to promote domestic tourism as well as to attract more foreign visitors to the country.
After four months of deployment, the programme has brought back several satisfactory results, making a contribution to preventing the decline, raising competitive capacity and the position of Vietnam tourism and creating the linkage and unification in action among tourism enterprises nationwide, localities and related agencies.
Positive signs
2009 is a really tough year for the global tourism industry with the possibility of a negative growth due to the deep impact of the global economic crisis. Tourism demand in the world has seen a sharp decrease. The competition among countries to attract tourists has become more and more acute.
After the promulgation of the action programme with a tourism promotion campaign entitled ‘Impressive Vietnam’, a joint agreement was signed by six market working groups formed by the General Department of Tourism and Vietnam Airlines.
The agreement was considered as the basis to help travel agencies directly negotiate with the aviation company to build certain promotion programmes.
There were 118 hotels (ranking from one to five stars), 85 travel agencies, 14 shopping centres, two transport companies and Vietnam Airlines joined the campaign. Many travel agencies have stepped up exploiting market, providing various promotion programmes as committed.
More than 300 promotion tours have been made public for both domestic and international tourists with price list. Hotel room rate (from three to five stars) in Ho Chi Minh City, one of the nation’s biggest tourism centres, reduced at least 30% compared to the same period last year.
On the basis of the proposal by the Ministry of Culture, Sports and Tourism, the Prime Minister decided to reduce 50% of the value added taxes (VAT) for hotels, travel agencies which provided package tours and transport companies as well as to reschedule the income tax to nine months for these enterprises, creating favourable conditions to help them deploy their promotion programmes.
In response to the national campaign, Vietnam Airlines launched a programme with an offer of 60% reduction in ticket prices applied to air routes of Hanoi-Hue, Hanoi-Da Nang, Ho Chi Minh City-Hue and others to encourage more tourist arrivals to the central provinces.
Moreover, many localities also organised a number of interesting tourism events with many attractive promotion products.
In general, the biggest success of the campaign was the growth of the domestic tourism thanks to the active participation of the Association of Travel Enterprises in Ho Chi Minh city together with the ticket price reduction policy on some domestic air routes and a series of special offers by hotels, restaurants and tourism sites.
More than 300 service units have lowered the price. Some hotels, resorts in the central provinces have offered price of 25%-30% off, Hanoi-Lao Cai rail route has also reduced 10% in prices.
The number of tourists of travel agencies have seen a remarkable increase after two months of the launching of the campaign. And due to the reduction of the tour price, the number of domestic visitors has increased by 35%-50% compared to the same period last year.
Vietnam Airlines together with their partners from France and Germany and other international travel agencies also launched the national tourism campaign of ‘Impressive Vietnam’ in these markets. Many tourists from Europe joined the programme.
As for the near markets such as Thailand, the number of Thai tourists to Vietnam in caravan increased remarkedly. According to a report by the Da Nang Department of Culture, Sports and Tourism, travel agencies in the city welcomed 4,500 visitors from Thailand.
Strengthening association for the mutual sake
The action programme has created the association among tourism enterprises especially between travel and hotel businesses. However, in the context of festivals season in the first quarter of 2009 and fluctuation of petrol prices, it is very difficult to ask transportation units to lower prices.
To provide the most reasonable prices for their customers, many travel agents have to negotiate prices with service suppliers. As a result, tourism promotion activities did not take any good effects. There is yet any close co-ordination among travel agents and information exchange has not been updated and uniform.
The role of the group leader has not been promoted and still very passive. Moreover, travel enterprises find it very difficult to order plane tickets at lower prices as pledged to serve their international tourists in promotional tour programmes.
Businesses providing accommodation have also met with difficulties in implementing policies on tax and service. Due to the ever increasing electricity, water and other materials prices, the input prices have also gone up. So, accommodation providers do not want to lower their services prices as promotional programme. Many localities like Hanoi, increase the fees instead of lowering them for tourists.
Besides, aviation enterprises only lower prices for several international flights. Especially, the role of the Tourism Association is not clear. So far, the action programme has not had any money geared for its deployment, so it makes bad affects on other businesses.
This has obstructed the activities of survey, building tourist services, launching promotional campaign to domestic and international markets.
In the second period of the campaign from May to September, the Vietnam National Administration of Tourism focuses on promoting domestic tourism, attracting international tourists.
The Vietnam National Administration of Tourism co-ordinates with the Ministry of Police, the High Command of Border Guard and the Ministry of Foreign Affairs deploy activities like exempt visa fee for tourists of promotional tours, increase the number of promotional flights and increase the rate of promotional seats from 10 to 20%.
The Vietnam National Administration of Tourism also proposed to exempt import tax for over 24-seat touring car, allow foreign tour guides to practise in Vietnam and apply the same electricity and water prices to hotels and other travel agents.
In addition, some over 4-star hotels are allowed to open to 2am. In the future, it is advisable to have a policy to refund value added tax (VAT) to tourists and encourage them to have more purchases.
Co-operation and high responsibility are required among tourist businesses, authorities and relevant units so as to deploy successfully the action programme and the promotional campaign ‘Impressive Vietnam’ and to recover the tourist growth rate this year.
The co-ordination of actions from the central to local units is needed for the benefits of the national development.