Investment in the tourism sector in Vietnam

Investing in the tourist sector has the ability to improve a country's economy as well as its international relations. In recent years, Vietnam has actively boosted its tourism sector by improving infrastructure, enacting tourist-friendly legislation, and even opening museums. The country has been able to use its dramatic history of conflict to promote tourism that attracts visitors from all over the world. Tourism currently contributes at least VND 207,798.0 billion (USD9.3 billion) to the country's total GDP and employs an estimated 4,003,000 people. Many Americans and other foreigners continue to visit Vietnam on business and for pleasure. Consequently, there is a high potential for growth in the Vietnam tourist sector.


Geographical Analysis


People who tour to Vietnam are attracted not just by the conducive weather and natural tourist destinations but also some historic events that occurred in the country. Vietnam is located in the Southeast Asia and borders Cambodia and Laos to the west, South China to the east, China to the North and the Gulf Thailand to the south. Bordering these countries is an advantage to Vietnam since among all of them Vietnam is still lagging behind in tourism. Tourists who are fond of visiting the bordering countries may decide to visit Vietnam resulting in an increase of the tourist market. The geography coordinates of the country are 16 20 N, 107 50 E. The country is mainly characterized by different geographical features including hills, tropical lowlands, densely forested highlands and the plain that covers at most 20% of the land (Hays 2013). There is plenty of clean water for consumption by people both in the rural and urban regions.


According to the Vietnam Trade Office in the United States of America (2013), tropical forests and mountains cover 75% of the total land, but most of the people live in the flatlands. The mountains and tropical forests are a major tourist attraction site since there are species of animals, birds and plants that thrive mainly in these regions. Mountain climbing and hiking is also a good outdoor tourist activity for people who enjoy physical exercise. Forests can be good places for bird watching and adventures during the seasons when there are fewer rainfalls.


The climate of Vietnam is influenced at large by the tropical forests and temperate areas. Overall, the climate is characterized by intense monsoon influence; there is also a lot of sunshine, high humidity, and rainfall. Such climate is perceived as cool and favorable to most tourist, especially those who want to escape the intense sunshine during summer by finding cool and relaxing environment. However, heavy rainfall that is common in Vietnam can deter some potential tourists from visiting the country, especially if the intention of the tourist is to walk in natural settings such as the forests and the mountains. The solution to this challenge is simply providing a weather guide to the tourists. For instance, tourists can be asked to travel during the months that have weather characterized by more sunshine and less rainfalls. If they visit during high rainfall season, they can still be guided to engage in outdoor activities in the morning hours when it is unlikely to rain; later in the evening they can tour indoor areas such a historical archive.


In summary, Vietnam tropical forest and mountains form the basis of tourist attraction. Travelers can engage in various activities such as bird watching, mountain climbing and adventure in such areas especially when there are no rains. The mountainous and forest regions also serve as a habitat for plants and animal species which are rare and may attract some tourist. Despite being affected by monsoons and heavy rainfall the country also get significant sunshine. With a weather guide, tourists can be informed on the time to visit the area and also the activities that they can carry out through the day in such a way that they are not caught up in the rain. Natural resources such as the Red River and Mekong River also attract tourists who simply love viewing the flow of the rivers and the huge waterfalls. The enormous hydropower also attracts tourist whose main intention is to learn.


Historical Analysis


As earlier stated, many historical sites that are frequently visited by tourists in Vietnam preserve the memories of wars that occurred in the country some decades in the past (Handerson 2000) One of such site is the Reunification Hall located in Ho Chi Minh City; which is the region where Vietnam War ended (Gillen 2014). The construction had historically been used as a home for General Nguyen Van Theu and was situated in South Vietnam. The bunker in the reunification place was used to preserve the final position of the troops. The War Remnants museum is also a significant tourist attraction site for people visiting Vietnam. The museum has three floors and contains war artifacts, photographs that exhibit the horror of war. Besides, there are also unexpected ordinance, armored planes, vehicles, helicopters and other tools and equipment of war which have been placed outside the museum.


Cu Chi Tunnels are another historic attraction site in Vietnam that resulted from war. The tunnels are huge underground network that was used as a command post for soldiers from North Vietnam. The tunnels stretch for a length of 75 miles to the border of Cambodia. The Nha Trang which formed the main Airbase for the US troops during Vietnam War has also been turned into a tourist attraction site. Vietnam’s location of Hoi An province which was named as world heritage site by the UNESCO. Although the town was largely affected by War, it has preserved many historical sites that attract tourists.


The other town where tourist can spend many days visiting historic areas is Hue. The Hue battle was extremely intense and resulted in deaths of many innocent civilians. It contains the royal tombs which attract tourists across the globe. The Hoa Lo prison located in Hanoi is another significant tourist site. The prison was built by the French for torturing Vietnamese activists that wanted independence for their country.


Social and Cultural Analysis


Le and Cooper (2009) state that there are various sociocultural places in Vietnam which are likely to be suggested for tourist visiting the country. Some of these areas include French architectural buildings (comprising of churches and opera houses in Hanoi and Ho Chi Minh City); Ho Chi Minh Mausoleum is based in the ancient residential quarter in Hanoi. These places are well known and contribute to development of the country as well as to the world history. Other ancient buildings, temples, and churches provide significant tourist destinations since religious people may visit the places to worship the faith. Most of these historic sites represent a cultural heritage for the Vietnamese. Some of the museums have images of girls wearing the Ao Dai which is the traditional dress represented on the background of ancient towns.


Given that the tourist attraction sites, such as the Cu Chi tunnels, involve walking and adventure, there is a likelihood that it attracts people who are not only spending their vacation but also wish to have physical activities. Through travelling to most of these historic places tourist gets to also learn about the traditions and the cultures of the people. However, some may not wish to be reminded of war; hence, they avoid most of the historic museums.


Statistical Evidence of Tourism


Vietnam is an emerging economy with growing tourist industry. The domestic tourism rate is compared to foreign tourists visiting Vietnam. The population of the Vietnamese as of 2009 was 89 million. At least one-third of the residents, tour once every year implying that there are a minimum of 2 million travelers annually (Bui & Jolliffe, 2011). There are specific towns which are predominantly tourist attraction site and also have greater potential of attracting more tourism in future.


The Hoi An is one of the areas where in 2010 a total of 2,391,677 tourists visited the province. 60% of them were domestic tourists while 40% comprised of foreign travelers. The average stay was 2 days period and it was estimated that international tourists were more likely to stay longer compared to the domestic ones. About 7204 got employment in the tourist sector for this province only. The other town that is a major tourist attraction site is Hue. In 2010, it had a total of 1.5 million visitors- 600, 000 were from foreign countries. Tourism in this town accounts for more than 7,000 employees (See Figure 1). Hanoi also receives up to 1.5 million tourists most of whom are local Vietnamese. Last but not least, Lao Cai province received 380,000 foreign tourists and 37,800 local tourists in 2010 (HITT, 2013).


Figure 1: Showing the employment in Vietnam’s tourism industry (WTTC, 2017)


A current report released by the World Travel and Tourism Council (2017) states that the direct GDP contribution from tourist in 2016 was VND 207,798.0bn (USD 9.3bn), 4.6% in 2016. This figure is expected to rise by 7.5% in 2017. If a growth of 6% per annum is realized during the next ten years, the GDP direct contribution by 2027 will be VND 398,329.0bn (USD17.9bn) (See figure: 2). The travel and tourism sector was also responsible for a total of VND410, 008.0bn (USD18.4bn) which is 9.1% of the total GDP in 2016. The forecast in 2017 for total GDP was 9.2% which amounts to VND770, 786.0bn (USD3 4.6bn). In 2016, the industry had a direct contribution of 1,959,500 jobs which is 6% of the total employment. The total employment was up to 4,003,000 jobs which are 7.3% of all workers. With regards to the visitor's exports, the tourism sector received VND184, 811.0bn (USD8, 291.3mn) which represents 4.5% of the total exports.


Figure 2: Pie Charts showing tourism contribution to Vietnams GDP (WTTC)


Ministry of Culture Sports and Tourism (MCST) (2017) statistics indicates that foreign tourist to Vietnam in October 2017 were 1, 024, 899 which represented a progression of 5.0% over the past month and at least 24.7% increase compared to a similar period in 2016. The total foreign arrivals in the country since January of 2017 to October reached 10,473,320 people which represents a 28% rise within a year. The MCST also indicated that the tourist peak season was during the Tet holidays which occurs mostly during the opening of the year – that is from January to February. During this period, the tourism department provides discounted air tickets and at other time subsidized fee so as to encourage many tourists to visit the area. According to Hobson et al. (1994) the hotels and accommodations also flourish during the Tet due to having many local and international travelers in the country. The WTTC (2017) also indicates that there are notable trends of tourism spending in Vietnam. For instance, the inbound and domestic tourist spending on leisure accounted for 90.05% of the direct tourism GDP in 2016 which is VND322, 536.0bn.


Government Contribution and Influence


The Government of Vietnam plays a critical role in management and promotion of the tourism activities. The first role that the government engages in is making policy and procedures that guide the tourism in the country. Foreign relation is also influenced by the government as it seeks to establish peace with other countries. For instance, in the wake of global warming, the Vietnamese government has set various policies to safeguard and reserve natural fauna and flora. In 2016, the government gave an approval to a project that was aimed at promoting ethnic minorities and their literature. Such policies influence the promote tourism since, before foreign tourists decide to tour a country, they mostly review policies of the country. If the policies are not friendly, the visitors may choose to go to other countries.


Besides, the government also approves some major proposals made by the tourist authorities. Entry into Vietnam by international travelers and tourists is also regulated by the government so as to ensure that travelers do not pose any danger to the citizens and that the visitors enjoy themselves as they tour Vietnam. For example, in March of 2016, there was a proposal by the De Nang City Authorities to have a tourist police. The government approved the proposal and tourist police were allocated to the area. The other role of the government in promotion of tourism activities is funding projects that can boost tourism in the country. A recent example of government’s role in policies and procedures is pilot grant of E-Visa. The government issued a Decree No.07/2017/ND-C which provided guidance to the procedures of giving electronic Visa for international visitors (MCST, 2017). The government of Vietnam also provide funds to projects that contribute to the growth of tourism in the country. Ways in which such funding is allocated include sponsoring tourist events or providing money to tourism project. For instance, cleaning and opening of the Cu Chi tunnels was facilitated by the government funds which was utilized for the cleaning process.


Transportation Features


There are various means through which international tourists can enter Vietnam. Air transport is available for international tourists from countries which are far from Vietnam especially those that are located outside Asian continent. Accessing a visa and the air ticket can simply be done online due to advancement of the Internet. Some tourists from the overseas can also opt to access Vietnam through water transport using such means as ship or boats. The foreign visitors must have a visa that shows they are coming for tourism. However, people from the bordering countries can travel through road transport and get to their tourist destination. The main gateway cities include Hanoi, Ha Long Bay, Nha Trang, Hue and Da Nang.


Locally, there are many transport options that can be used by the tourists including the cycle, boat, buses, motorcycles, and vehicles such as taxis. Local tourists may guide themselves to the place where they wish to go. Since Vietnam is an emerging economy most of its transport network is modern. However, foreign tourist must seek for a tour guide. The wages for an informal tourist ranges from $VD 1.5million to $3million ($UD70-$US150) in one month, though people with qualification may get up to $UD300 (HTTI, 2013). In a research conducted by the HTTI (2013) findings indicated that among the factors influencing tourism transportation was among the most poorly performed since there are no specific means of transport for tourist.


Evaluation of the transport features shows that tourism attraction based on the transport is likely to be low to medium. The advantages that the country has is that its infrastructures are relatively developed compared to those of other countries. Vietnam is also not a landlocked country hence foreign tourists can access the land through water in addition to air transport. Availability of electronic visas also makes it efficient for tourists seeking opportunities in the country. The drawbacks with regard to transport network is that there are no guides.


Americans Travelling to Vietnam


Relationship with the Americans has been of major interest to the Vietnamese. According to MCST (2017), validity for visa for US citizens coming to tour or for business in Vietnam was extended to allow more Americans to tour the region more often. The information from the MCST also states that more and more Americans are traveling to Vietnam. One reason accounting for the increase in American visits is the rapid development that has taken place.


The security with the country is good and most tourist can feel safe while traveling. However, according to the Central Intelligence Agency (2017), the offshore water and territorial in the South China Sea has a high piracy risks. Such situation may pose a threat to the tourists who intend to come to Vietnam through the sea. With regard to culture, the Vietnamese are majorly a communist community, unlike Americans who are individualistic. They, however, have good etiquette and respect for other cultures.


Conclusion


Vietnam has high tourist potential. With continued investment in tourism, it is expected that there will be growth in the industry. The country has many natural resources, relatively good weather, and plenty of safe water for consumption. Major historical sites, especially those that pertain to the Vietnam War, have also been preserved to as tourist attraction sites. The government has also been making financial investments and policies to enhance improvement in the tourism sector. Citizens are friendly and the region is largely secure for tourists. The only drawbacks for the region’s tourism include heavy rainfalls, poor transport coordination and piracy issue at the sea. These challenges should be addressed to attract more tourists.


References


Bui, H. T., & Jolliffe, L. (2011). Vietnamese domestic tourism: An investigation of travel motivations. ASEAS-Österreichische Zeitschrift für Südostasienwissenschaften, 4(1), 10-29.


Central Intelligence Agency (2017). The World Factbook: East & South Asa::Vietnam. Retrieved from: https://www.cia.gov/library/publications/resources/the-world-factbook/geos/vm.html


Gillen, J. (2014). Tourism and nation building at the war remnants museum in Ho Chi Minh city, Vietnam. Annals of the Association of American Geographers, 104(6), 1307-1321.


Hays, J. (2013). Land, Geography, Whether and Climate of Vietnam. Facts and Details. Retrieved from: http://factsanddetails.com/southeast-asia/Vietnam/sub5_9h/entry-3488.html


Henderson, J. C. (2000). War as a tourist attraction: the case of Vietnam. The International Journal of Tourism Research, 2(4), 269.


High Impact Tourism Training. (2013) HITT Inception Analysis Vietnam. Retrieved from: http://www.hitt-initiative.org/wp/wp-content/uploads/2013/03/HITT_Inception_Analysis_VIETNAM_English.pdf


Hobson, J. P., Heung, V. C., & Chon, K. S. (1994). Vietnam's tourism industry: can it be kept afloat? The Cornell Hotel and Restaurant Administration Quarterly, 35(5), 42-49.


Le, T. A., & Cooper, M. (2009). Vietnam’s image as a tourism destination in Japan: an analysis of Japanese travel guidebooks and brochures, and attribute importance-performance. Ministry of Culture Sports and Tourism (2017). Tourism Statistics. Retrieved from: http://vietnamtourism.gov.vn/english/index.php/cat/1501


Vietnam Trade Office in the United States of America. (2013). County of Vietnam, general information. Retrieved from: http://www.vietnam-ustrade.org/index.php?f=news&do=detail&id=37&lang=english


World Travel and Tourism Council (2017). Travel & Tourism Economic impact 2017 Vietnam. Retrieved from https://www.wttc.org/-/media/files/reports/economic-impact-research/countries-2017/vietnam2017.pdf

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