International tourism in Vietnam to start full recovery next year: Savills

By Tri Duc
Sun, August 6, 2023 | 9:31 am GMT+7

Vietnam’s tourism market is recovering and “full recovery is expected from 2024,” says Troy Griffiths, deputy managing director of property consultancy Savills Vietnam.

The firm's first-half review of the hotel sector notes that arrivals from China were the second highest among foreigners visiting Vietnam in H1/2023, but they reached only 22% of pre-pandemic 2019 level.

The number of Chinese visitors is expected to increase in H2/2023 as this period a peak season there. Chinese outbound travel is expected to stage a full recovery in 2024-2025.

Foreign tourists at the Cai Rang floating market in Can Tho city, southern Vietnam. Photo courtesy of Young People newspaper.

Foreign tourists at the Cai Rang floating market in Can Tho city, southern Vietnam. Photo courtesy of Young People newspaper.

Top two destinations

In H1/2023, Ho Chi Minh City welcomed 18 million visitors, the highest in Vietnam, but only 11% of these were foreigners. The number of foreigners visiting HCMC was equal to 46% of the same period in pre-pandemic 2019.

HCMC’s focus on business travelers and as a stopover location for visitors resulted in accommodation payments of VND1.5 million per visitor per trip, the second-highest in Vietnam, only behind Hanoi.

HCMC’s hotel occupancy of 64% in H1/2023 was close to the pre-pandemic rate in H1/2019, the Savills review said.

The average room rate was VND1.9 million per room per night, or 97% of that in H1/2019. Savills noted that the summer holiday was not of great significance in HCMC, given its reliance on business travelers.

The city, a southern economic hub, recorded the highest accommodation revenues of VND5 trillion ($210.66 million) in H1/2023, up 25% year-on-year. With the latest addition of 180 rooms in Mai House Saigon, HCMC has 15,662 five-star rooms in 110 hotels.

In H1/2023, Hanoi welcomed 12 million visitors, up 5% year-on-year, and meeting 55% of the year target. This included 10 million domestic visitors, 53% of the 2023 target. The two million foreign visitors accounted for 66% of the year target.

In Q2/2023, Hanoi’s hotel occupancy was 62%, significantly below 73% in Q2/2019. The average room rate was VND2.5 million per room per night, up 26% year-on-year.

At the end of H1/2023, Hanoi had 10,962 four-star and five-star rooms, up 10% year-on-year.

In H2/2023, Hanoi will welcome several new hotels, including the L7 West Lake Hanoi operated by South Korea’s Lotte with 264 rooms. In 2024-2025, an addition of more than 2,600 rooms is expected. Prominent among upcoming projects are Dusit Hanoi, Fairmont Hotel, Shilla Hotel, Four Seasons, and Hyatt Regency.

Vietnam welcomed nearly 1.04 million international arrivals in July, the highest monthly figure recorded since the country reopened in March 2022 following a long Covid-19 triggered closure.

The figure was up 6.5% from June, three times higher than July last year and equivalent to 79% of the pre-pandemic period in 2019, according to the General Statistics Office (GSO).

In the first seven months of this year, the number of foreign visitors to Vietnam reached 6.6 million, up 5.9 times year-on-year and equal to 83% of the country's year target. South Korea was the largest source with nearly 1.9 million arrivals, accounting for one third of the total, followed by China with 738,000 and the U.S. with 445,000.

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