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Lead the way

Released at: 08:28, 28/10/2014 Hospitality Sector

Lead the way

Vietnam's tourism has the potential to develop but needs a quality tourism programme.

by Mr Paul Stoll, CEO of Celadon International

Vietnam's modern tourism commenced with the economic reforms in 1986 known as "doi moi" and has grown from a few hundred thousand travellers each year to 7.6 million in 2013. In comparison, Thailand welcomed 26.7 million tourists, which is more or less the tourism potential of Vietnam by 2030 according to the "Strategy on Vietnam's Tourism Development until 2020 and Vision to 2030," approved by Prime Minister Nguyen Tan Dung in Decision No 2473/QD-TTg dated December 30, 2011. This is supported by steady global tourism growth that notably passed the 1 billion travellers mark in 2013.

Travellers are looking for "new" destinations, which is why Vietnam is so attractive. Vietnam became recognised with its "Vietnam - a Destination for the New Millennium" campaign in 2000. As a result, the number of foreign tourists jumped 20 per cent from 1.7 million to 2.1 million. Before 2000 Vietnam was considered on par with the Asian Tigers until reality caught up in the form of the Asian Economic Crisis in 1997/8.

Major FDI projects like the New World Saigon Hotel, Caravelle Hotel, Furama Resort, and Sheraton Ho Chi Minh City opened before the crisis and others in the pipeline continued after 2000, such as the Park Hyatt Ho Chi Minh City. Becoming a member of the World Trade Organisation (WTO) in 2007 marked another milestone in tourism, creating another high, but was soon followed by the Global Financial Crisis in 2007/8. Nevertheless, Vietnam is driven by powerful, long-term underlying trends, coupled with short-term development interests spearheaded by local businesspeople. Ultimately this kept Vietnam growing, but not without growing pains. Both inflation and interest rates skyrocketed to around 18 per cent and 23 per cent, respectively. Still, the government managed to tame the Asian Tiger and bring inflation down to around 8 per cent and interest rates to around 10 per cent. Building quality standards suffered in the process, however, affecting the value appreciation of the investment and the tourism image of Vietnam. There is a need for a quality tourism programme to be initiated by authorities.

Destinations develop around international airports in areas of travel interest. In Vietnam this is Ho Chi Minh City, Hanoi, Nha Trang, Da Nang and Phu Quoc Island since 2013. Destinations with domestic airports are considered secondary - Dalat, Hue, and the Mekong Delta. These are crucial to complete the tourism distribution network, which should make the destination a developed tourist destination by 2030.

Vietnam is still a novelty in the travel market and hence an attraction for travellers. It's important to understand travel motivations, which makes Vietnam attractive to at least 50 per cent of the 200 million tourists travelling in Asia. Their travel motivations have to be understood by tourism authorities and the travel trade, who then have to adjust product development, operations and marketing accordingly. Guidance has to be provided by tourism authorities with development plans.

Tourism development is going to accelerate if the attitudes and commitment of developers change and authorities introduce a quality tourism programme. The fact is that most of the existing local developments will have to be redeveloped or downgraded to meet global positioning standards of five- to one-star hotels. Companies like the Wyndham Hotel Group, the largest hotel company in the world according to Hotels magazine's listing of the Top 300 corporate hotel companies, are entering the market place with popular super brands like Wyndham (five-star), Ramada (four-star) and Super8 (three-star), joining existing hotel management companies such as Accor, Hyatt, IHG, Hilton, and Starwood. These companies meet the required brand expectations and further introduce the benchmark of international three-star with Super8 and Ibis. The Hong Kong-based CHAO Global Services is to open the first of its CHAO hotels, of international three-star standard, called CHAO INN, in Ho Chi Minh City this year and plans three-star hotel properties throughout the country. This will further inject confidence into Vietnam's tourism product and open doors to the middle market. Vietnamese/international companies such as Vinpearl, Sovico, Liberty, and Saigontourist will emerge with improved products and services, challenging international management companies.

Vietnam has all the ingredients for being a popular tourism destination, but "marketing" thinking has to be introduced.

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V.paulstoll

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Furama is not international hotel chain, and there's also not Intercontinental but IHG hotel group. The content must be corrected!