Outbound trips — VietEcon

The Vietnamese are starting to travel outside of the country. This is exciting! I truly believe that travel can open your mind to different people and experiences. And it can kickstart innovation back home - people see how things are done elsewhere and come back to make changes. Hopefully for the better (sometimes for the worse).

Anyway, one of the bottlenecks in passports. It seems like most Vietnamese don’t have them. So lines to get a new one are quite long: the 1,000 person limit is being reached daily.

Where do Vietnamese travelers go?

Mostly they go to places in Vietnam. Da Nang is the #1 holiday destination this summer, according to a survey undertaken by Agoda (see right) this year. Out of the top 10 places, 7 are in Vietnam. Which makes sense - it is much more expensive to travel abroad. In past surveys, we have seen Paris in the top 10, but that didn’t come up this year. South Korea is one to watch as well, with lots of people looking to travel there, for both work and pleasure.

Outside of Vietnam, the top travel destinations are mainly neighbors in Southeast Asia, since ASEAN countries don’t require visas. That’s a big deal, because Vietnamese passport holders need a visa for all but 51 countries. In comparison, Japanese citizens can go almost anywhere: they don’t need a visa for 190 countries! And getting a visa to many Western countries can be quite difficult for the Vietnamese. The US issued 120,000 non-immigrant visas in Vietnam in 2018, and 28,000 immigrant visas. That’s a lot, but 26% of all applicants are refused. This is a bit worse than Thailand (22%) and much worse than Indonesia (13%) and Malaysia (5%) but about the same as the Philippines (27%).

Fun fact: Once abroad, Vietnamese do like to keep close to home in terms of cuisine. They prefer Chinese and Korean, although they mostly like Vietnamese food!.Maybe we should start to talk about Ugly Vietnamese, rather than Ugly Americans (just kidding, Germans are the worst :0).

How big is travel abroad?

According to the chairman of the Vietnam Tourism Association, Vietnamese spend $7-8 billion per year overseas. I don’t really believe this number (it could be right, it could be wrong), because I get such different numbers on the amount of Vietnamese traveling abrod. The Vietnam Society of Travel Agents says 10 million traveled abroad in 2018, while this survey from Mastercard said that 7.5 million will go abroad in 2021, up from an estimated 4.8m in 2016 (see chart on left). The Mastercard figures seem more reasonable to me, since the percentage of households traveling abroad is already relatively high at 25% in 2016 (that’s probably the last real number and not a forecast).

As Vietnam gets richer, we are going to see lots more outbound travel, but the main beneficiaries of a richer Vietnam will continue to be local Vietnamese destinations. That’s why so many companies, like VinGroup, are investing heavily in domestic resorts. Foreign companies, especially hoteliers, are getting in the game to service domestic and foreign tourists.