Tourism Industry Seeking Wayouts

9:52:42 AM | 8/21/2020

After three months of inactivity owing to the Covid-19 pandemic, the Vietnamese tourism industry had just restarted when the second pandemic outbreak emerged in Da Nang, resulting in renewed dormancy of tourism and travel activity across the country. How to respond to existing difficulties and how to recover and develop after the pandemic are matters of concern of authorities and travel businesses.

Back into dilemma

The tourism industry, that had just restarted after a long period of social distancing, was stunned again when the Covid-19 pandemic reappeared. On July 25, the first infection case in the community was confirmed in Da Nang City after 99 straight days of no community infection. The contagion spread to some other localities and led many tourists to cancel their tours not only to pandemic areas but also to non-pandemic places.

Many localities across the country quickly announced the closure of many tourist attractions and suspended entertainment services to ensure safety for tourists and residents. Some do not organize tours, send people to or receive people from infected areas, while requiring public employees not to go to pandemic areas or to other provinces.

The Lao Cai Tourism Department said that after the confirmation of new Covid-19 infections in Da Nang, the local tourism sector started to be affected. Up to 80-90% of tourists cancelled their tour bookings scheduled from July to September.

According to data from the Vietnam National Administration of Tourism (VNAT), up to 95-100% of tourists cancelled their tours in July and August, the two peak months of domestic tourism. Airlines, hotels and tourism service providers have experienced a very difficult period and slid into another crisis right after going out of it.

According to tour operators, air carriers currently only allow rescheduling deposit use, not refund it. This is a great pressure because the deposit value is significant, especially when they already suffered a huge loss during the first Covid-19 outbreak, and tourists claimed refunds for tours postponed or annulled. Airlines allow 180 days of delay but tourists do not want to travel any longer.

Huynh Phan Phuong Hoang, Deputy General Director of Vietravel Company, said, the pandemic forced many businesses to cut staff or apply unpaid leave to employees waiting for tourism recovery. During the first outbreak, the Government issued support policies for laid-off workers. However, tourism workers did not have access to support packages. Some had to find other jobs to make their living. Therefore, when tourism activity is restored, businesses will not have enough experienced personnel to restart their operations if they cannot keep their important staff.

VNAT General Director Nguyen Trung Khanh emphasized that businesses are the core force of the tourism industry. Travel, accommodation, transportation and service providers are closely interrelated. If any link in this chain is weakened or broken, it will greatly affect the overall operation of the tourism industry. Solutions are needed to overcome current problems, as well as to acheive post-pandemic recovery.

How to solve difficulty?

Right after an outbreak, the government and businesses supporting, associating and sharing with each other is vital to overcome difficulties. At the heart of the new pandemic hub, Mr. Cao The Dung, Chairman of the Da Nang Tourism Association, said that, during the outbreak, the mobility pressure is huge. Every day, from 30,000 to 40,000 visitors leave Da Nang. This is considered an immediate response to ensure safety for visitors and prevent the contagion. Besides, the association is coordinating with businesses and hotels to deal with tour postponements and cancellations to ensure customer interests.

Sharing this point of view, Mr. Vo Anh Tai, Deputy General Director of Saigontourist, also proposed the Vietnam National Administration of Tourism to study and develop a legal framework to ensure safety for customers in case of infections, while easing heavy pressures on businesses. Currently, businesses are all damaged and local authorities have delivered support but the reality is very difficult. Airlines also need to have more flexible policies for force majeure cases rather than apply rigid regulations that distress travel companies.

Mr. Vu The Binh, Vice Chairman of the Vietnam Tourism Association, said it is necessary to have immediate concrete solutions to support businesses, especially small and medium-sized enterprises (SMEs), to escape the crisis caused by the pandemic.

The engagement of service providers is necessitated to remove difficulties for businesses. In addition, it is also necessary to inform customers to share hardships with businesses by postponing or preserving travel packages to be used again, when the pandemic ends. In the meantime, businesses also need to make a clear commitment to assure customers or convert into service vouchers for use in safe destinations or when the pandemic ends.

In addition, they need government support like access to soft loans. They are advised to join together to make a list of borrowers and send it to the Government and the State Bank of Vietnam (SBV) for loan approval.

They also need to assist each other and have support from tourists. Financially viable companies can consider refunding financially troubled ones in the service supply chain.

Mr. Lai Duy Minh, CEO of TST Tourist Service & Trading Corporation

The Covid-19 pandemic distressed travel firms. The decline in tourist arrivals also caused tourist support services such as accommodation, food and drinking, entertainment and shopping to slide into difficulty. TST Tourist proposed tax relief and financial support for tourism human resources because 80 - 90% of tour guides are laid off. In addition, it is difficult for tour operators to reimburse booking deposits to customers and airlines and service providers are expected to apply specific service discounts to make customers who cancelled tours feel comfortable for new travelling after the contagion is under control.

Ms. Tran Thi Nguyen, Sales Director of Sun Group

This is the second time the tourism industry has faced Covid-19 and also the second time we sit down to discuss solutions and go through the most difficult time together. I propose VNAT and other agencies make the second national tourism stimulus program, assist localities to attract tourists, work out support policies aimed to help tourism businesses to launch stimulus in other countries in the world, transfer national promotion programs engaged by the Ministry of Culture, Sports and Tourism. The night-time economy is encouraged for service development.

Ms. Le Thuy Ha, Sales Director of Flamingo Group

Flamingo has launched quick policies to promptly assure customers. We have separate villas for guests to relax and entertain themselves in safety, suitable for families and small events. We have worked with travel and service companies to ensure one-year booking reservation for customers with unchanged service value. We must learn how to cope with hardships caused by the pandemic and how to get support to overcome hardships faced by the tourism industry in general and hospitality industry in particular. To do this, the top priority is human resources. We proposed reducing electricity bills and land rents to help hotels and housing facilities maintain stable human resources and maintain the environmental landscape to serve customers after the pandemic ends.

By Giang Tu, Vietnam Business Forum