List of Contents and Tables

Executive Summary 1

Still Faced With Inflation and Fuel Price Growth 1

H1n1 Epidemic Affects the Tourism Industry All Over the World 1

More Policies To Attract Tourists 1

More Luxury Hotels Springing Up 1

Vietnam Tourism Hopes To Recover in 2010 1

Key Trends and Developments 1

Impact of the Global Recession 1

H1n1 Flu Pandemic 2

Legislative Environment – Vietnam Offers VISA Exemption for Diplomatic Passport and Special Public Service Passport Holders 3

Inequality Distribution of Hotels Across the Country Poses Problems 4

Homestay and Vietnamese-cuisine-cooking Tours Are Becoming More Popular 5

Arrivals by Sea Start To Increase Again 6

Demand Factors 7

Balance of Payments 7

Market Indicators 7

Table 1 Leave Entitlement: Volume 2005-2009 7

Table 2 Holiday Demographic Trends 2004-2009 8

Table 3 Holiday Takers by Sex 2004-2009 8

Table 4 Holiday Takers by Age 2004-2009 8

Table 5 Length of Domestic Trips: 2004-2009 8

Table 6 Length of Outbound Departures: 2004-2009 8

Table 7 Seasonality of Trips 2005-2009 9

Market Data 9

Table 8 Balance of Tourism Payments: Value 2004-2009 9

Definitions 9

Tourism Parameters 10

Travel Accommodation 12

Hotel Price Platforms 14

Transportation 15

Car Rental 16

Travel Retail 17

Travel Retail Online Sales 18

Tourist Attractions 19

Health and Wellness 20

Internet Sales 20

Summary 1 Research Sources 21

EXECUTIVE SUMMARY

- Still Faced With Inflation and Fuel Price Growth

Vietnam is expected to face big problems of inflation in 2009. The government has also continually made many changes in the fuel price, causing it to fluctuate during the first half of 2009. Vietnamese people have tightened their purse strings and only spend money on the essentials, hindering travel and tourism. Therefore, all aspects of Vietnam tourism including arriavals and departures in the year 2009 have declined slightly compared with 2008.

- H1n1 Epidemic Affects the Tourism Industry All Over the World

In 2009, Swine flu (H1N1),which started in Mexico and quickly spread all over the world mostly by means of tourism, caused a great deal of damage to the tourism industry, not only in Vietnam, but in every country in the world. Airports have started strict security checks whereby every tourist has to go through a temperature check before being able to board. People have also cut back on travelling for fear of catching H1N1, reducing the number of tourists.

- More Policies To Attract Tourists

The government has implemented several initiatives to attract more tourists to Vietnam, such as hotels (mostly luxury hotels) and tourist agents all over the country offering lower prices. Some leading travel agencies such as SaigonTourist and Vietravel have reduced their prices by up to 30% for tours to major tourist destinations in Vietnam. Hotels and travel agencies have also increased the service quality such as room service, car rental, and airport transfers. Some provinces are chosen to host festivals like the sea festival at Nha Trang, fruits festival at Can Tho, and the Mekong festival. These festivals last a few days and there are a lot of activities like parades, concerts and exhibitions to attract more tourists. These are traditional festivals but they were previously on a small scale and celebrated only by locals. Since 2005, the government has made them into big events spanning several days, with a lot of activities to attract more tourists. Although they seemed to be fascinating for the tourists initially, the festivals just repeat themselves every year offering nothing new and many tourists feel that the festivals are becoming too commercial and have lost their spirit. This is the reason why the number of tourists drawn to these festivals is declining every year.

- More Luxury Hotels Springing Up

Many international corporations have recognized the promising tourism business in Vietnam and decided to invest. Many luxury hotels are being built and existing ones are going through renovation. Vietnam’s first six-star hotel is being built in Vinperland, Nha Trang and is said to go into business at the end of 2010. However, there tends to be a mismatch in locations of luxury hotels. Tourists prefer travelling to mountainous and quiet areas such as the highlands, Sapa, and the countryside, but the hotel rooms in these areas are often all booked well in advance.

- Vietnam Tourism Hopes To Recover in 2010

With good medical attention, most H1N1 swine flu cases took one week to recover. According to the WHO, travelling restrictions are not necessary. In 2010, the H1N1 epidemic will have been controlled and the global financial crisis should begin to lessen. Travel and tourism will recover and tourists will come back to Vietnam, putting the industry in a good position to gain further revenues in the longer term