Rapidly rising disposable incomes and an increasing affinity with travel have led to a surge in outbound tourism from Vietnam, with large swathes of the country’s burgeoning middle class using the Lunar New Year holidays as a chance to venture overseas.
“There aren’t so many times you can have a long holiday,” 27-year-old marketing officer Pham Thai Quynh told the Financial Times. “I use every Tết to go abroad,” Quynh added, using the Vietnamese term for the Lunar New Year.
The number of foreign trips taken by Vietnamese tourists reached the 7.5m mark in 2017, having increased over the past few years at an annual rate of 10-15%, according to London-based market intelligence firm Euromonitor International, which also found China to be the destination most visited by Vietnamese travellers.
Underpinning the boost in outbound tourism are shifting consumer preferences – a recent survey by market research firm Nielsen found that consumers aged 30 to 55 in Hanoi and Ho Chi Minh City ranked travel as a hobby above eating out and buying new clothes – and an impressive economic growth rate that last year surged to a ten-year high of 6.8%.
Since Vietnam’s transition towards a “socialist-orientated market economy” in 1986, the country has transformed itself from one of the world’s poorest into one that enjoys lower middle-income status, with poverty rates dropping from 60% in 1993 to 13.5% in 2014, according to the World Bank.
However, poorly performing tertiary education institutions and oppressive state censorship mean that the country faces a significant skills shortage that could see it fall into the ‘middle-income trap’ – perennially struggling to make a profit from low value added manufacturing due to rising labour costs but lacking the skills necessary to make the jump towards globally competitive high-tech industries.