TOURIST Erasmus+

1. TOURIST Erasmus+ Status-quo Analysis of the Tourism Industry and Sustainable Tourism Efforts in Vietnam Tran Huu Tuan School of Hospitality and Tourism-Hue University, Vietnam thtuan@hueuni.edu.vn

2. Content • Vietnam tourism at a glance • Strategy for tourism development in Vietnam • Financial perspectives • Tourism and sustainability • Statistical information and Socio-economic impact of tourism

3. 1. Vietnam Tourism at a Glance

4. Vietnam at a glance • Position: Heart of South-East Asia, bordering with China, Lao PDR, Cambodia and East Sea • Area: 331,230.8 km2 • Climate: Tropic, 4 seasons • Population: 96,019,879 (2017)1 • Majority: Kinh, 53 ethnic groups • Language: Vietnamese • Major religion: Buddhism • Economic: GDP: 215.8 bill USD (2017)1 1General Statistics Office of Vietnam Report 2017

5. Vietnam tourism performance 2017 • International tourist arrivals: 12.9 million • Domestic tourists: 73 million • Tourism receipts: 510,000 Billion VND (22.46 billion USD) • Contribution to GDP: 7.5% • Tourism employment: 1.2 million (direct) • Hotel capacity: 21,000 establishments, 420,000 beds • 1493 international-market tour operators, more than 13,000 domestic-market tour operators, and 21,000 registered tour guides in Vietnam. (Source: Vietnam National Administration Tourism Statistics Report 2017)

6. International tourist growth rate (2016)

7. Characteristics of international tourism market to Vietnam • Increased at an average rate of 8.9% annually compared to UNWTO figures of 3.4% for world tourism over the same period. • Ten source markets accounted for more than 75% of the total number of international arrivals to Vietnam in 2017. • North Asia (China, South Korea, Japan and Taiwan) provide 60.4% of Vietnam’s international arrivals in 2017. • Whilst China is clearly Vietnam’s largest market, their overall value is debatable (indications are that many arrivals are by land from across the border – often from regional cities and towns, that visitors stay only a short time, and have a relatively low daily spend). • Whilst inter-regional tourists from China, Cambodia, Lao PDR, and Indonesia are significant, it can be expected that a significant portion are in fact trade and labor movements. • Low cost airline carriers (LCC) are fuelling tourism growth in the region in particular from the Philippines, Indonesia and Malaysia. • Arrivals from Russia are rapidly increasing (574,164 arrivals in 2017). • European markets are showing upward growth but at slower rates. Top performers include the United Kingdom (283,537 arrivals in 2017), France (255,369 arrivals), Germany (199,872 arrivals) and the Netherlands (72,277 arrivals). (Source: Vietnam National Administration Tourism Statistics Report 2017)

8. Characteristics of domestic tourism market to Vietnam • Domestic tourism is the overall industry’s biggest market segment and increased by more than 10.2% over the last decade. • Although domestic tourism is highly peaked in the summer months, it contributes substantially to accommodation viability across all grades and will continue to grow as the economy (and disposable income) grows. • The market is expanding both amongst city-dwellers and rural populations. • Increasing motor bike and car ownership, and subsidized domestic flights that keep air travel costs low are assisting mobility. • The average length of a domestic trip has increased from 2.6 nights in 2001, to 3.0 nights in 2010 and 4.5 nights in 2017. • Young tourists seeking exploration and discovery (known as “phuot”) will play an increasingly significant role in tourism development in new destinations, especially in remote areas. • Domestic tourists are particularly attracted to Hanoi (Zone 2), Hue-Hoi An- Da Nang (Zone 4) and Ho Chi Minh City (Zone 6). (Source: Vietnam National Administration Tourism Statistics Report 2017)

9. Tourism attractions in Vietnam • History and culture • Beaches and island: Ha long, Phu Quoc, Nha Trang, Mui Ne… • Divers ecosystem • 22 World heritages (8 tangible + 14 intangible) • 30 National Parks • Vietnamese cuisine • Traditional festivals • Handicraft villages • Unique life style • Friendly people

10. Travel and tourism competitiveness 2017: Vietnam • Rose by eight places in 2017, ranking 67th globally. • The main drivers of the Vietnam’s travel and tourism competitiveness are: - natural resources (34th) - cultural resources (30th) - price competitiveness (35th) • Vietnam has made significant progress on its human resources and labor market pillar (37th, up 18 places) scores, thanks to a better-qualified labor force (53rd) and partially simplified regulation to hire foreign labor (75th).  (Source: World Economic Forum Travel and Tourism Competitiveness Report 2017)

11. Travel and tourism competitiveness 2017: Vietnam (cont.) • Vietnam has also made exceptional improvement to its ICT capacity and usage (80th, up 17): - 94% of the national territory is covered by a 3G signal - individual internet usage rose from 44% to 53%: penetration of information technologies is proceeding at a sustained pace. • Linked to the country’s increasing online presence, searches related to Vietnam’s natural tourism are growing, increasing the appeal of its natural resources (improving six places). • Continued economic development has led to expanding business travels (further increasing three places). • Security and safety perception (57th) are also making Vietnam an increasingly attractive destination for developing its travel and tourism sector. (Source: World Economic Forum Travel and Tourism Competitiveness Report 2017)

12. Travel and tourism competitiveness 2017: Vietnam (cont.) • To continue enhancing the sector’s competitiveness, Vietnam should focus on: - Environmental sustainability (129th) - Lax regulations (115th) - High levels of emissions (128th) - Deforestation (103rd) - Limited water treatment (107th) These issues are depleting the environment and should be addressed, perhaps at a multilateral level, to build the foundation for a more sustainable development of the region. (Source: World Economic Forum Travel and Tourism Competitiveness Report 2017)

13. Travel and tourism competitiveness 2017: Vietnam (cont.) (Source: World Economic Forum Travel and Tourism Competitiveness Report 2017)

14. 2. Strategy for Tourism Development in Vietnam

15. Resources for tourism development • Natural attractions: eco system, fauna, flora, climate, parks, reserved areas, beaches, caves, rivers, lakes, forests... • Humanitarian attractions: heritages, arts, cuisine, festival, life style, craft village, man-made attractions.. • Human resources: number, quality, tourism education and training system • Financial resources • Infrastructure • Tourism facilities and capacity development

16. Vietnam tourism strategy and master plan to 2020, vision to 2030 Development vision “Sustainable tourism development in the direction of quality, branded, professional, modern development; effectively exploiting and concentrating all national resources and advantages; enhancing interdisciplinary, inter- region, socialization and role of enterprises”.

17. Vietnam tourism development:Objectives • Tourism becomes a key sector characterized by: highly professionalism, modern facilities, high product quality, diversity and well branding with in-deep own national culture value, environment friendly and competitive able in regional and international markets. • Vietnam to become a competitive and well developed destination.

18. Vietnam tourism development goals (cont.) • Economic– attract 17-20 million international visitors by 2020, and serve 82 million domestic tourists. Increase tourism revenue to US$ 18-19 billion by 2020 (12% annual increase). Contribute 10-11% of GDP by 2020. Attract $42.5 billion in investment, increasing room supply to 580,000 rooms by 2020 and 900.000 by 2030. • Social – increase numbers employed in tourism to over 3 million, of which 870,000 are direct jobs. Ensure tourism development contributes to the preservation and promotion of Vietnam’s cultural values, improving the lives of its people. • Environmental – Develop green tourism activities associated with preserving and promoting the value of natural resources and environmental protection, ensuring that tourism development complies with environmental law.

19. Products Develop quality products based on the natural strengths of Vietnam’s seven tourism zones: • Zone 1: Midlands & North • Zone 2: Red River Delta & Coastal Northeast • Zone 3: North Central • Zone 4: South Central Coast • Zone 5: Central Highlands • Zone 6: South East • Zone 7: The Cuu Long River (Mekong Delta) With a focus on marine/beach tourism, cultural tourism, and nature-based tourism. Vietnam faces fierce competition in the promotion of its core tourism products (coastal and beach tourism, cultural tourism, and nature-based tourism) with Thailand, Malaysia and Cambodia.

20. SWOT Analysis • Strengths: national advantages, attractions, resources, policy, experience, lesson-learned • Weaknesses: managing attraction & resources, infrastructure and facilities, human resources, market & product development, capital mobilization, innovation, management & role of government • Opportunities: political and social stability, peace, world trend, regional advantage AP • Threats: economic crisis, political change, natural disaster, climate change, terrorism, new trend, competitive pressure

21. Positioning and Branding Whilst Vietnam’s unique selling proposition has not been clearly defined, those who are familiar with the destination know that it is: • Very different to Thailand (a soft, smooth, luxurious image) • Very different to Malaysia (prosperous, Islam-dominated yet also ‘truly Asia’) • Different to Singapore with its developed and prosperous urban and contemporary image. The uniqueness of Vietnam: rich and varied culture, delicious cuisine, strong spirit of independence and continuing vibrancy and energy in rebuilding itself.

22. Positioning and Branding (Cont.) The core elements of the Vietnam tourism brand position are: • Time. Vietnam is a destination that “enables spare time” but also where “time can stand still”. Here, the traveler can regenerate and experience unforgettable moments - whether it is watching a cultural performance or relaxing on a white sand beach. • Intensity. Vietnam is a place of intense travel experiences – from its natural wonders and cultural delights through to its bustling cities. Vietnam is adventurous, authentic, untouched and still to be explored. • Mystery. Vietnam’s possesses a mixture of exotic and yet authentic cultures, ethnic groups, religions and traditions set within a spectacular backdrop of misty mountains, green fields and endless ocean horizons. Here, travelers can collect unforgettable stories and tales to pass on to their family and friends. • Commitment. The Vietnamese people provide visitors with a service that is rooted in cultural traditions and qualities of loyalty, friendliness and charm – and prerequisites for good service.

23. Positioning and Branding (Cont.) In accordance with the branding strategy, four product groups have been identified to present to relevant market segments: • Brand group 1: Culture • Brand group 2: Coast • Brand group 3: Eco-based • Brand group 4: City breaks

24. Budget for Marketing Activities • Budget for Vietnam tourism marketing is still limited. Although the government pushes ahead this plan and states that it would be on top of agenda, there is not much funding for those relevant activities. • In 2016: US$12.8 million • In 2017: US$15.0 million

25. 3. Financial perspectives

26. The Vietnam Tourism Development Fund (VTDF) Under Decision 1861/QĐ-TTg, the VND30 trillion (US$1.32 billion) program will focus on building and upgrading tourism and transport infrastructure at provinces with key tourist destinations. (Source: Vietnam National Administration Tourism Statistics Report 2017)

27. The Vietnam Tourism Development Fund (VTDF) The objective is to boost investment in: • transport, information and communications • energy, water supply and drainage • public transport network; public spaces; • social infrastructure of culture, health, and education: museums, theaters, clinics, training and educational establishments, with sufficient conveniences and  facilities for tourists

28. Travel & Tourism attracted capital investment of VND129,952 billion ($6 bil.) in 2017. This is expected by 6.9% pa over the next ten years to VND253,445 billion ($11 bil.) in 2027. • Travel & Tourism’s share of total national investment will rise from 9.7% in 2017 to 10.4% in 2027. Source: World Travel & Tourism Coucil, Economic Impact Vietnam Report 2017

29. Investment in the hospitality sector is expected to continue to increase in tourism centers, especially in coastal areas, with a focus on the high-end and three- to five-star segments. (Source: Vietnam National Administration Tourism Statistics Report 2017)

30. 4. Tourism and Sustainability

31. Viet Nam’s Master Plan on Tourism Development by 2020, with Vision to 2030 Goal: Developing sustainable Vietnam in combination with preserving and promoting national cultural values, and protecting landscapes and the environment • To achieve this goal, the country is carrying out comprehensive measures including: • completing legal system • implementing overall tourism development plans • enhancing competitiveness • professionalizing tourism promotion • protecting local culture and natural environment • training human resources

32. European Union funded – project: “Environmentally and Socially Responsible Tourism Capacity Development" (EU-ESRT) (2011 – 2016)

33. EU-ESRT Project • the largest tourism technical support program in Vietnam (12.1-million-EUR), and • funded by the European Union (EU), aiming to support policy and strengthen institutions, develop organizational structure, build an effective private-public cooperation network and raise public awareness of responsible tourism.

34. EU-ESRT Project • Has helped increase public awareness of responsible tourism, and responsible tourism has become a significant part of Vietnam’s tourism policies and practical activities.  • The project successfully carried out the Private-Public Discussion (PPD) mechanism by establishing Tourism Advisory Board (TAB) and Destination Management Operation (DMO), marking crucial progress in the country’s tourism management methods. 

35. 5. Economic Impacts of Tourism

36. (Source: World Travel & Tourism Coucil, Economic Impact Vietnam Report 2017)

37. (Source: World Travel & Tourism Coucil, Economic Impact Vietnam Report 2017)

38. (Source: World Travel & Tourism Coucil, Economic Impact Vietnam Report 2017)

39. COUNTRY RANKINGS: ABSOLUTE CONTRIBUTION, 2016 (Source: World Travel & Tourism Coucil, Economic Impact Vietnam Report 2017)

40. COUNTRY RANKINGS: ABSOLUTE CONTRIBUTION, 2016 (Source: World Travel & Tourism Coucil, Economic Impact Vietnam Report 2017)

41. Thank you