Visa Waiver Shows Positive Effect on Vietnam Tourism

Vietnam arrivals Jan Nov 2015

Vietnam tourism had a very bad start earlier this year with international visitors figures down by almost 14% during the first quarter 2015 and still down by 12% for the first half of the year.

It has been a positive wake-up call for Vietnamese authorities. Vietnam government acted swiftly with visa rules being relaxed for some major inbound markets in a bid to stimulate its tourism industry. Since July, Belarus, France, Germany, Italy, Spain and the UK benefit from free visa to enter the country for a stay not exceeding 15 days. Tour operators are now lobbying the government to have more countries included and the length of stay to be extended to 30 days.

And it works! According to latest data released by the Vietnam Tourism National Administration, total arrivals to the country were up by 20.4% in November compared to the same month of last year. Vietnam is closing the gap with 2014 with a decline reduced to -2% only for the first 11 months of the year. If the trend continues in December –which is most likely- international tourist arrivals will be slightly up compared to 2014.

Countries which now benefit from free visa-on-arrivals are clearly showing an upward trend, with growth varying from one country to another.

Most disappointing is probably France, Vietnam’s largest inbound market from Europe. Total French arrivals are up by 7.4% in November, compared to an average growth of 8.5% for Europe. However, France’s economic situation and a destabilized political environment (Paris massive terrorism killing on November 13 after Charlie Hebdo massacre in January) certainly weights on consumption, including travel.

Best performing is by contrary the UK, up in November 2015 by 33%, a result also due to the increase in air capacities by Vietnam Airlines. Italy is the second best performing country with tourist arrivals up by almost 29% in November (compared to the same month of 2014) followed by Spain, up by 19%. Inbound visitors from Germany however progress by 10.5%, on pair with other European countries which do not benefit from the visa waiver program. As an example, Belgium arrivals were up by 12% and Swiss arrivals by 14% in November.

From January to November, total arrivals from Europe are down by 1.9% at 1.21 million arrivals, a result largely influenced by the collapse of the Russian market following the depreciation of Russia’s local currency. Russian tourists –who benefit from free visa on arrivals for a couple of years- were down by 27% in November and by 10% from January to November. However, the total arrivals from the 5 visa-waived countries are up by almost 3%, generating during the period over 600,000 visitors. This is an extremely encouraging sign.

December should meanwhile translate into a further recovery from Europe. European inbound arrivals should close the year with a slight surplus. Vietnam can expect strong growth in 2016 from most markets as the country will further simplify travel conditions. More countries are on the radar of authorities for a visa waiver while more traffic rights will be provided to airlines wishing to serve secondary destinations.