Vietnamese travel agencies are confronted harsh competition from international travel joint ventures. It is also difficult to attract foreign tourists to Vietnam.
According to Travel Department, Vietnam Administration of Tourism (VAT), due to WTO commitments on tourism and services, Vietnam cannot limit investments in hotels, restaurants. But in travel business, foreign companies instead of investing 100 % can only establish joint ventures with Vietnamese partners and the joint ventures are without outbound services.
Recently however, Ministry of Culture, Sports and Tourism has permitted the joint ventures to organize outbound tours for Vietnamese citizens and foreigners living and working in Vietnam.
Fierce competition
It is truly a strong boost to tourism especially in the conditions of world economic crisis. It also helps the joint ventures that were allowed only to receive inbound tourists.
Mr. Vu The Binh, Travel Department, VAT, reaffirmed that previous regulations were merely international practice (not protectionism for domestic companies) to ensure balanced competition between inbound and outbound businesses.
The joint ventures can now develop outbound tourism. According to the guidance of VAT on formalities, the joint ventures can start those activities from August 10, 2009 to December 31, 2010. After completing the formalities, six joint ventures have started organizing outbound tours for Vietnamese tourists.
The joint ventures have comparative advantages compared to domestic companies as they have huge resources, strong brands, high technology, professional organization, global network and highly competitive. In particular, the joint ventures with financial strength will launch promotion programmes at certain times that domestic companies cannot compete.
Domestic companies cannot reduce tour prices if Vietnam Airlines refuses to decrease air fares. Meanwhile, the joint ventures can use discount air tickets of their airlines for outbound Vietnamese tourists, something that cannot be done by Vietnamese companies.
The joint ventures have also advantages in application for visas, especially major markets as EU, US, Japan. They can also expand tours that Vietnamese companies have not developed such as survey, conference, seminar or trade promotion in foreign markets.
Equal difficulty for inbound tourism
The high time for foreign tourists to come to Vietnam is from September to April. However this year, according to travel businesses, it will come later and end earlier. Director of a travel company said that Vietnamese companies have to promote tours at all costs to get tourists by the year end or next year otherwise they would receive no tourists as Thailand, Malaysia, Singapore are launching impressive promotion activities.
Economic crisis and epidemic diseases have affected tourism. The change of orientation is necessary and promotion must change accordingly. VAT has done it well with Vietnamese tourists but not with foreign tourists. Distant markets such as Europe and US have decreased significantly in the recent past.
While Vietnamese companies have many difficulties in promotion activities, they expect much in national promotion programmes. However, they feel the stimulus package “Impressive Vietnam” was unimpressive and fell short of their expectation. Furthermore, the exempt of visa fees for foreign tourists from May 15 to September 30 could not be implemented as the formalities are too complicated and time consuming and the companies had to apply in the same old way.
Kim Nhung
Vietnamese
