Absence of major Asian markets a tourism challenge

Vietnam resumed last week its pre-pandemic visa exemption policy and reopened doors to all foreign tourists with relaxed entry rules, with visitors required to present a negative Covid test and no quarantine.

However, industry insiders said the inbound tourism market can't stage a short-term recovery to pre-pandemic times, given the absence of tourists from China, Japan and South Korea, Vietnam's biggest feeder markets.

China, Vietnam's biggest tourism markets with 5.8 million arrivals in 2019, is still pursuing its zero-Covid policy with lockdown measures and strict entry restrictions.

South Korea and Japan, Vietnam's second and third largest tourism markets, are imposing quarantine rules on those visiting or returning from abroad.

Nguyen Vu Khac Huy, CEO of the Phu Quoc-based Vina Phu Quoc Travel Company, said the number of foreign tourists visiting the country will remain low for the first two months after reopening because Vietnam's traditional markets haven't fully reopened their tourism industries.

"Late in the second quarter or the third-fourth quarter, the inbound tourism market could revive," Huy said.

Nguyen Trung Khanh, head of the Vietnam National Administration of Tourism, said foreign tourists would not return to Vietnam immediately after reopening as they need time to plan their trips.

"We reopened international tourism at this time to connect with markets and start receiving tourists from September until March next year," Khanh said.

Pham Ha, chairman of Lux Group, which specializes in luxury cruises, said his company will bring a group of 16 Spanish tourists to Vietnam this summer.

"The reopening of inbound tourism is a good sign but travel firms need at least three months to prepare everything to bring foreign tourists back," Ha said.

The peak travel season for European and Australian tourists is always from September to April and they would take several months to plan their trips, he added.

Bui Quoc Dai from Anex Vietnam, which specializes in bringing Russian tourists to Vietnam, said now is not the peak travel season for Russian tourists, the sixth largest tourism source market after mainland China, South Korea, Japan, Taiwan and the U.S., with over 650,000 arrivals a year.

"The Russia-Ukraine conflict and a series of economic sanctions by the U.S. and European countries have caused the Russian ruble to depreciate against the dollar and euro, which means Russian tourists will have to pay more money when booking a tour, Dai said.

However, he also said Vietnam could benefit from the source of Russian tourists in the coming time as many European countries have imposed restrictions and banned flights from Russia.

"My company is expecting to bring the first group of Russian tourists back to Khanh Hoa (in central Vietnam) early April," he said.

Expectations

Huy said his company has received positive responses from tourism partners in Laos, Malaysia, Thailand and Singapore.

His company expects to welcome the first of Southeast Asian tourists post-reopening late this month.

Ha also said that in the short term, Vietnam needs to target tourism markets that are able to "recover quickly." Currently, tourists from ASEAN countries have a tendency to make short trips, while those from Germany, Spain, the U.K., France and the U.S., the Middle East and Australia usually visit during the summer season.

Uzbekistan and Kazakhstan are also potential markets because they they have no policy to isolate people returning from abroad, he added.

With borders closed, the number of foreign arrivals last year plunged by 96 percent against 2020.

This year, Vietnam has set a target of welcoming five to six million foreign tourists. In 2019, the year before the onset of the pandemic, it welcomed a record 18 million foreign tourists.