Will tourism replace crude oil as a major source of revenue?

In 2016 and the first 10 months of 2017, the tourism sector witnessed rapid growth in both the number of travelers and revenue. 

The Vietnam National Administration of Tourism (VNAT) said that Vietnam in 2016 received 10 million foreign travelers, an increase of 25.4% over the year before, and 62 million domestic travelers.

The report of the agency showed that total revenue from travelers reached VND400 trillion, up by 18.6% compared with 2015. 

In the first 10 months of 2017, more than 10.4 million foreign travelers came to Vietnam, up by 28.1% over the same period last year.

High growth rates in the number of travelers have been reported for all markets – 53.9% for the Republic of Korea, 45.6% for Russia and 37.1% for Hong Kong. 

The strong rise of the tourism sector has brought big benefits to supporting services. Transport and accommodation services, for example, have reported the sharpest growth rates in the last four years.

In its report about Vietnam economic prospects released in November 2017, HSBC commented that the government of Vietnam has applied measures to improve the tourism sector.

In 2016, the government for the first time organized a national conference on tourism development and waived visas for citizens from France, Germany, Italy, Spain and the UK. This helped increase the number of tourists from Europe by 21% compared with the year before.

Since early 2017, Vietnam has used a simple visa granting program for Chinese citizens. It is expected that the number of Chinese travelers will exceed the 9 million threshold by 2018.

Tourism has been making a great contribution to Vietnam economic growth in recent years. The government has decided to focus on developing the tourism sector instead of exploiting minerals and polluting industries.

The Party Politburo’s Resolution No 08 decided that by 2020 tourism will become a key industry which creates impetus for economic development. The industry wants to attract 17-20 million foreign tourists, 82 million domestic travelers and make up 10% of GDP.

Vietnam hopes it can earn US$35 billion from travelers and US$20 billion worth of exports via tourism and create 4 million jobs. 

To reach these goals, travel firms said they need support from the State. Nguyen Van My from Lua Viet Travel said travel firms have been developing without organized planning, while the role of the state remains dim.

He said if the state can create a transparent market with healthy competition, Vietnam can increase the tourism growth rate 2-3 times.