Preparing to Welcome Visitors When Market Is Open

The Covid-19 pandemic has devastated Vietnamese tourism industry. However, thanks to the efforts of the Government and businesses, the tourism industry is working hard to prepare for the opening of its market in the coming time.

Severe decline

In 2020, the Covid-19 pandemic caused a disaster unprecedented in history. Tourism is among the most affected sectors, with a massive fall of international demand amid global travel restrictions, including many borders being fully closed, to contain the virus. According to the World Tourism Organization (UNWTO), the estimated decline in international tourism in 2020 is equivalent to a loss of about one billion arrivals and US$1.1 trillion in international tourism receipts. This plunge in international tourism could result in an estimated economic loss of over US$2 trillion in global GDP.

No exception, Vietnam's tourism also suffered a serious decline. At the conference on summarizing the work in 2020 and implementing the tasks in 2021, Mr.  Nguyen Trung Khanh, General Director of Vietnam National Administration of Tourism, said under the impact of the Covid-19 pandemic, the tourism industry of the world in general and Vietnam in particular had suffered severe damage, seriously affecting results and fundamentally changing the tourism development strategy and goals in 2020. The number of international tourists to Vietnam in 2020 only reached about 3.7 million arrivals, down 80% compared to that of 2019; domestic visitors reached 56 million arrivals, down 34.1%; the total revenue from tourists was estimated at VND312.2 trillion, down 58.7%, equivalent to US$19 billion.

The decline in the share of the tourism industry led to problems with employment. Many businesses had to cut workers to maintain their operations, many others had to shut down because they could not cover operating costs. According to statistics, about 40-60% of workers lost their jobs or suffered reduced working days; 95% of international travel businesses stopped working; many hotels had to close, the occupancy at times only reached 10-15%.

Looking ahead, the announcement and the roll-out of a vaccine are expected to gradually increase consumer confidence and contribute to ease travel restrictions. UNWTO’s extended scenarios for 2021-2024 point to a rebound in international tourism by the second half of 2021. Nonetheless, a return to 2019 levels in terms of international arrivals could take 2.5 to 4 years. In context, Vietnam tourism also needs to look back at the development problem and find directions for recovery.

Preparing to welcome visitors when the market is open

The pandemic has caused a delay in the transport of tourists among regions and countries, and many parts of the world have had to suspend passenger transportation services, leaving even tourists who want to travel without transport. On the other hand, the severity of the pandemic causing confusion for tourists is also one of the factors causing a decline.

In that context, the Vietnamese economy in general and the tourism industry in particular need to provide clear preparation plans and solutions if they want to stimulate tourism demand. According to representatives of the Vietnam National Administration of Tourism and the Ministry of Culture, Sports and Tourism and businesses, Vietnam tourism needs to implement many solutions at the same time.

First of all, it is necessary to strengthen the disease control in order to respond promptly when the pandemic tends to increase. It is important to combine a safe tourism model for health through quarantine for tourists, with activities to improve the resistance of tourists such as cycling, marathon and soccer. Promoting domestic tourism with short-term trips toward cultural and natural heritages is essential to avoid crowded places. At the same time, travel companies need to cooperate with airlines, transportation, hotels, and restaurants to build tourism stimulus packages to help tourism recover quickly after the crisis.

Besides, according to Mr. Pham Tien Dung, Vice Chairman of Hanoi UNESCO Travel Club, the Government should have tax exemption and reduction policies for tourism businesses, such as VAT exemption for tourism consumption and tourism businesses, reducing environmental costs for tourism businesses, reducing presumptive taxes for tourism business households.

In addition, it is also necessary to strengthen promotion, marketing and development of new products to attract tourists, and apply technological advances to reach a wide range of domestic and foreign customers. More investment in technology, green infrastructure, and value addition will be the foundation for more sustainable, inclusive and resilient tourism. Along with that, it is important to perform the digital transformation and aim towards green tourism in the future.

“It is necessary to promote communication of safe products in Vietnam that have been experienced by tourists; opening new international tourist markets,” said Mr. Tran Hung Viet, Chairman of Ho Chi Minh City Tourism Association.

On the business side, they should organize experience sessions for visitors to use digital tourism products, allowing them to see the convenience and optimal features of the service. With the application of digital transformation in tourism, this can be seen as a new direction to help the Vietnamese tourism market open up and develop.

Agreeing with those arguments, Standing Vice Chairman of the Vietnam Tourism Association Vu The Binh emphasized that the tourism industry needed digital transformation to change the activities of the tourism industry. This will turn an ordinary economic industry into a digital economy. In digital transformation, tourists do not need to visit the company to buy tours. Besides, customers can change hotel schedules without having to go to the company, all of them require tourism businesses to change their management and business activities; at the same time using information technology, using artificial intelligence and digital promotion. If the tourism industry is successfully transformed, the tourism industry will catch the opportunity when the Covid-19 pandemic ends.

By Giang Tu, Vietnam Business Forum