Asian Tourists Top The Charts in Vietnam

By: Mark Gwyther

If a picture is worth a thousand words, then the chart below says everything you need to know about the state of international tourism in Vietnam. The number of inbound international arrivals to Vietnam more than doubled in the last six years, but over 80 percent of the growth has come from two countries: China and South Korea. In May of this year, travellers from those two countries accounted for more than half of the total inbound travelers to Vietnam, the first month this has ever happened.

travel in vietnamImage source: Vietnam National Administration of Tourism

Unfortunately, for someone who wants to write an interesting article on the evolution of tourism in Vietnam, the reason for the growth is not some exciting new strategy or a genius development plan. The causes are simply economics and geography.

Economically speaking, South Korea and China had mammoth increases in the number of new middle-class families the last 10 years. International travel is a result of disposable income; research shows people begin travelling overseas when their income tops US$1,500/month. In South Korea’s case, the average income increased to a point where a majority of the population achieved it. China’s average income is still well below the threshold, but its population is enormous, so even a small increase in the middle-class results in millions more tourists.

A second economic factor is the difference in income levels between those countries and Vietnam. Travellers from North Asia have more purchasing power when travelling to Vietnam than they have in more developed countries or their own. In other words, relatively cheaper golf, food, shopping and hotel rooms.

Geographically, Vietnam is positioned perfectly for these new middle-class consumers. Vietnam represents a cheap alternative that is nearby, has an extensive coastline, and warm temperatures all year.

travel in vietnamImage source:

Obviously, these new middle-income Asians have different purchasing considerations than do Westerners who come to Vietnam. Travelling halfway around the world to an exotic location means authentic adventure. With high costs and long distances before arrival, Western travellers try to experience as much as possible, especially the experiences that cannot be found at home. Adventure travellers are typically experienced travellers in small groups and without children. The nearby Asian middle-class travellers completely differ in their vacation desires. Arriving in large tour groups or with the entire family, the trip to Vietnam is considered a low-cost option in foreign travel.

Vietnam is not “once-in-a-lifetime” to Asian travellers. It is a nearby retreat with a familiar culture.

The significant change in customers since 2011 completely transformed tourism in Vietnam. To satisfy these new traveller’s tastes, investors flocked to the beach cities near the international airports. The beaches of Ha Long Bay, Danang, Nha Trang, Cam Ranh and Phu Quoc are filling with resorts, condotels and second-home villas. Other popular tourist locations had significant makeovers. BaNa Hills outside of Danang may be the most symbolic example of this paradigm shift. Ten years ago, it was an isolated nature reserve with old French chalets. Today a cable car transports thousands of visitors each day to the top where a mini-Disneyland overlooks new golf courses.

Video source: Flycam 4K

Everyone seems to have an opinion about where Vietnam’s tourism industry should go from here. Whatever those opinions are, nothing is going to stop this trend. The estimated five-and-a-half million Chinese visiting Vietnam in 2018 are only the tip of a very large iceberg. As stated above, China still has several years to go before even half its population achieves middle-class status. Growth will accelerate as hundreds of millions of potential tourists book outbound trips. Currently, Vietnam’s market share of China’s outbound travellers is very small. Between the growth of the market and growth of market share, Vietnam is going to have as many Chinese tourists as its infrastructure can support. And we haven’t even mentioned India yet.

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