How coronavirus poisons Vietnam’s tourism industry?

The outbreak of Coronavirus or nCoV in China has stricken Asia’s tourism industry with the plunge in demands for traveling and cancellation of flights from and to China, and Vietnam is not immune from it.

The coronavirus outbreak in China has led to the plunge in the number foreign arrivals in Vietnam. Photo by The Leader.

According to Mauro Gasparotti, director of Asia- Pacific Savills Hotels, besides posing health risks to travelers to China, the acute respiratory illness caused by nCoV is negatively impacting Vietnam in many ways.

First, there has been a sharp drop in the number of Chinese arrivals to Vietnam with popular coastal resort towns across the country desolate as China is Vietnam’s largest inbound tourism market, making up over 30% of the total arrivals in 2019.

The coastal city of Nha Trang in Khanh Hoa province is the hardest hit as it is where the first case of nCoV infection was detected and Chinese tourists made up over 70% of overall foreign arrivals to the city in 2019, said the provincial statistics.

Several meetings and conferences have also been canceled or postponed to avoid the possible contracting the disease, leading to the significant fall in the number of MICE travelers (Meetings, Incentives, Conferences and Exhibitions) in some big cities namely Hanoi and Ho Chi Minh City.

The second impact is the plunge in the number of foreign arrivals to Asia, where the risk of catching the disease is higher than in other destinations. After a high period with 138 million foreign arrivals in 2019 and annual growth rate marked record high at 7.8% over the past nine years, Southeast Asia is expected to face a comparatively huge decline in the number of international visitors as American, Australian and European travelers will postpone or cancel tours to Asia.

According to report of STR, a vital revenue management tool, during the SARS epidemic between 2002 and 2003, the average accommodation revenue in Asia fell by more than 4.5% while the current coronavirus outbreak is expected to result in a loss of more than US$1.5 billion to Thailand this year, according to a recent report by the Ministry of Tourism of Thailand.

The last impact is the demand for traveling is dropping significantly as most people tend to stay away from a crowded place such as airports, train and bus stations, restaurants and entertainment areas. Whether Vietnam may recover from the coronavirus impacts depend on the government's actions on preventing and resisting the epidemic in the coming time.

Gasparotti said that if the disease is successfully controlled and prevented globally and in Vietnam, the country’s tourism industry will recover in the second half of 2020 and continue developing.