Mr. Paul Stoll, CEO of Chao Global, discusses Vietnam's tourism industry development with VET's Linh San.

■ What are your thoughts on the growth seen in Vietnam’s tourism industry?

Vietnam has continued to see tourism growth since “modern tourism” commenced with the opening up of the country in 1986. 

A major milestone was reached in the 2000s, when the campaign “Vietnam, a Destination for the New Millennium”, was launched - a successful international promotion campaign that saw foreign tourist arrivals grow from 2 million in 2000 to around 13 million in 2017. This is around 40 per cent of what Thailand recorded in 2017, with more than 35 million foreign visitors, and it has set its sights on reaching 60 million by 2030. 

Continuing to look at the figures from last year, domestic tourism in Vietnam saw around 40 million trips compared to Thailand’s 160 million trips. In general, Southeast Asia tourism arrivals are going to grow 5-7 per cent annually, but this is contingent on economic stability, tourism being further developed, and destination marketing continued. 

More recently, Vietnam’s image development content on the global media stage, like on CNN for example, represents very well the reality and beauty of the country. That said, there is a need to add focus on proper infrastructure, which has advanced but not to the extent required. What I mean by this is that conventional utility resources must be replaced with alternatives such as solar energy and wind energy, and garbage collection is of paramount importance  in keeping the environment intact. Superstructure development must also be controlled and well-integrated into the environment. 

Drawing on an example, I am working on the Van Don Economic Development Zone in northern Quang Ninh province. As part of plans - the Master Plan 2040 and the Vision Plan 2070 - I have proposed Quan Lan Island become an integrated resort island where all the needs of responsible tourism are considered. We have a big focus on green tourism and wellness for Quan Lan Island, which will attract a new breed of lifestyle travelers and provide a tourism product and service that meets the interests of the existing mass market tourism in Ha Long Bay, particularly the portion expecting a mix of quality and adventure. 

In general, the growth of tourism across Vietnam is the result of mass-market travelers attracted by destination access convenience and low prices. This strategy must be adjusted to focus on quality tourism with standards in facilities, products, and services improved to match that of international expectations. 

■ How would you compare the growth in Vietnam’s tourism industry with elsewhere in the region?

Looking at neighboring countries like Thailand, Malaysia, Indonesia, and the Philippines, all comparable destinations within Southeast Asia, we can see that all of them have growing pains. 

In the Philippines, for example, these growing pains have resulted in the country closing Boracay Island for six months to carry out a major and necessary environmental cleanup. Boracay re-opened recently but this time with visitor restrictions and guidelines to support environmental regeneration efforts; a commendable decision in my opinion and one that should be applied to all destinations. 

Safety is another major concern for these countries. Vietnam, however, is considered a friendly and safe destination, and fares relatively well in this space. 

Overall, these destinations are part of ASEAN, a forum we must use more to manage tourism, with a focus on culture, society, products, the environment, and responsible tourism development. 

■ Many global hotel giants have flocked to Vietnam recently. Is this good news for the country’s tourism development? 

Global brands are trophies of successful destination developments, and they appear when stable destinations are looking to improve their image further. What’s interesting is that they come in all shapes and sizes, bringing the promise of increasing asset value, international standards, and tourist numbers. 

So, while this is good news for Vietnam’s tourism sector, it’s also important for local brands to venture out into the world and spread the country’s tourism image. The importance of “country marketing” like this so far has been ignored. 

■ What are the challenges facing foreign investors in Vietnam’s tourism sector?

Vietnam’s tourism industry contributed around 7 per cent to the country’s GDP in 2017 and this is forecast to grow to 10 per cent by 2020. FDI into the sector is a hot topic, but short-term local business and personal interests coupled with loose management models resulting in low returns have created a double-edged sword. 

Particularly in real estate, we continue to experience a lag in integrating Vietnam’s foreign investment policies with international economics. Well-practiced and attractive tourism real estate investment models around the world, i.e. condotels, still fall into a legal “grey area” in Vietnam, forcing projects to stagger and create uncertainty, despite their willingness to become involved. Also, the understanding of asset value creation in the minds of local entities, influenced by local practices and red tape, are not as all-inclusive as FDI, and must add product quality assurances and international service standards, among others.

■ Developing sustainable tourism in combination with preserving and promoting national cultural values and protecting landscapes and the environment are among the targets set in Vietnam’s master plan on tourism development by 2020 with vision to 2030. What should the country do to achieve this goal?

Let’s start with the long-term vision. Master Plan 2020, Vision Plan 2030 will encourage city and provincial governments to clean up hidden problems created by tourism. Achieving this destination planning and following through with infrastructure and superstructure development will be a major focus in the short-term. 

To support these efforts, management across the board will need to implement rules, regulations, and guidelines that tie into this vision and the steps taken to bring this to life. A Tourism Awareness Campaign will then be implemented to drive awareness and educate people on the benefits of quality tourism and how each individual, company, and government agency can participate.

Finally, a Quality Tourism Program will provide standard guidelines for hospitality, travel agents, transport, and retail outlets, and these will be rated for consumer transparency. These are the key ingredients needed to create a strong foundation for sustainable tourism growth in Vietnam.

■ Over the past decade, you and your team have established a global reputation for the Vietnam’s resorts and hotels and worked tirelessly to secure Vietnam’s place on the world’s tourism map. What are you doing now to develop new hospitality concepts to match Vietnam’s hospitality with traveler expectations?

What an exciting journey this has been!

Furama Resort Danang complemented other developments we worked on to strengthen Vietnam’s place on the world tourism map. This included the Caravelle Hotel in Ho Chi Minh City, Vinpearl Resort in Nha Trang, Celadon Palace Hue, Sun Spa Resort Quang Binh, and The Imperial Hotel Vung Tau, which all contributed to successful destination development in Vietnam. 

Learning from this experience, we crafted our mission for Chao Global much the same. Currently, I am working to introduce the four-star CHAO concept. CHAO is a new lifestyle concept that aims to elevate quality standards for all three and four-star hotels in Vietnam. It’s also a brand that will support spreading the image of Vietnam’s tourism across the world. 

Chao Global will also have a particular focus on introducing wellness travel to Vietnam, adding to the existing market segments required to meet Vietnam’s tourism growth goals. The first wellness resort, in south-central Phu Yen province, is in the design development stage. 

With several others in the pipeline, we’re aiming to develop according to the development mantra “63 Provinces - 63 CHAOs”. We’re also looking at developing CHAO sites overseas, thus working towards strengthening Vietnam’s tourism presence on the world stage.

The World Heritage Road, which connects 17 cities and provinces in central Vietnam, has been successful in driving up tourism numbers to date. However, this initiative requires continued government attention. Chao Global is going to support macro tourism activities like these, with the aim of creating the environment necessary for successful tourism and attracting foreign investment into Vietnam’s tourism sector.

VN Economic Times