With growing numbers of flights, there is new hope. But more needs to be done
Over the last year, much of the tourism outside of Hanoi and Ho Chi Minh City has taken a battering. Look at Nha Trang. New hotels are opening up almost daily, yet occupancy among the five-stars is down by almost 20 percent on the year before.
With the collapse of the ruble, the bottom-end Russian package tourists who used to arrive on chartered flights can no longer afford trips to Nha Trang or Mui Ne. So, many of the five-stars are focusing on the Chinese market. The Chinese market is huge, but the guests don’t spend money inside the hotels, leading to a decline in F&B revenue.
This creates a new conundrum. If the Chinese aren’t the answer, where should the tourists come from? And with the recent devaluation of the yuan, this begs another question. Will even the Chinese be able to travel soon?
Rays of Hope
A recent conversation with Ben Mitchell, one half of the husband-wife team behind Phong Nha Homestay, suggested that things aren’t as bad as they seem. Located in Phong Nha-Ke Bang National Park, home to the largest cave in the world, the development of tourism opportunities has seen the area boom.
“We’ve now got a lot more flights coming to Dong Hoi [the nearest city],” he said. “It’s great. We’re packed all the time.”
A quick check online shows that both Jetstar and VietJetAir fly daily from Ho Chi Minh City to Dong Hoi. The national carrier also operates daily flights. Yet only a few years ago there were just two flights a week to Dong Hoi. As Phong Nha has opened up as a destination, so new routes have been created. It augurs well.
In recent years, Dalat, too has seen an increase in domestic flights. It’s also got a new international airport. Yet it wasn’t always like that. For a large part of its modern-day existence, the French-built Palace Hotel (formerly the Sofitel Palace) managed an occupancy that hovered around the 30 to 40 percent mark. For years its owners lobbied the national carrier to increase flights. Without the flights, the six to seven-hour road journey from Ho Chi Minh City made travel to this French-built former hill station prohibitive.
The number of domestic flights has since quadrupled. Yet, the international angle has yet to take off. Direct flights have been set up to destinations such as Hong Kong. But at the time of writing, they had been suspended. Phu Quoc now has one direct flight running — to Singapore — and Danang has limited but regular flights to regional hubs such as Kuala Lumpur, Singapore and Hong Kong. Beyond that, the only international flights landing in the big cities outside of Hanoi or Ho Chi Minh City are chartered. To get the tourists in, direct international flights are key.
Time for a Strategy
Employing over 2 million people and contributing 6 percent of GDP, tourism development in Vietnam needs a multi-pronged strategy. There are several issues, ranging from destinations which remain undeveloped (Ha Giang, Quy Nhon, Con Dao) and restrictions on visa-free entry, to Vietnam being seen as a place to visit for a one-off cultural experience.
But without economically viable international connections direct to the country’s regional airports, tourism in this country will stutter and stumble from one year to the next.