US embassy cable - 04HOCHIMINHCITY782

UNCLAS SECTION 01 OF 02 HO CHI MINH CITY 000782 
 
SIPDIS 
 
E.O. 12958: N/A 
TAGS: ECON, SENV, ETRD, CASC, VM 
SUBJECT: HCMC TOURISM SEMINAR DRAWS LARGE CROWD, BUT CAN VIETNAM? 
 
 
SUMMARY 
------- 
1.  Despite recent setbacks from SARS and the avian flu, the 
number of foreign tourists to Vietnam has been growing steadily 
over the past decade.  Provincial and local governments, as well 
as the central government, have been pushing to make Vietnam a top 
tourist and leisure destination.  Yet the percentage of tourists 
coming from the U.S. has actually declined.  At a recent American 
Chamber of Commerce seminar in HCMC, visiting foreign experts 
advised the burgeoning travel and leisure industry to pool their 
financial resources in order to place Vietnam on the radar screen 
of American tourists.  Consul General Yamauchi urged the 
Vietnamese government to improve consular notification and access 
practices and to establish a tourist police.  Visiting experts 
suggested that the GVN streamline visa, immigration, and customs 
procedures, allow firms to bring in foreign management and 
technical staff without putting obstacles in their way, and to 
develop sensible infrastructure plans and projects.  But will the 
GVN focus on any of these issues? 
 
GVN NEEDS TO SHAPE UP 
--------------------- 
2.  On May 14, the American Chamber of Commerce (AmCham) in Ho Chi 
Minh City (HCMC) hosted a seminar on "Marketing Vietnam as a 
Destination for American Travelers."  AmCham assembled a slate of 
travel industry executives, market analysts, entrepreneurs, and 
travel writers to share their insights with their Vietnamese 
counterparts, who have repeatedly expressed befuddlement over the 
best way to attract American tourists.  The event drew more than 
200 travel industry professionals, Vietnamese and expatriate 
alike.  Keen local interest in how to draw American leisure 
travelers halfway around the world -- bypassing many attractive 
and more convenient destinations enroute -- meant the meeting hall 
was standing-room only by the time Consul General Yamauchi and 
Vice Chairman Nhan of the HCMC People's Committee delivered 
opening remarks. 
 
3.  The good news is easy.  Vietnam is an exotic destination with 
beautiful beaches, scenic mountains, and a range of historic 
sights and sites.  The bad news is that so do Thailand, the 
Philippines, and Indonesia, and those are just the regional 
competitors for American tourist dollars.  The one trump card 
Vietnam has to play -- the perception that it is the safest 
destination in Southeast Asia -- may not be enough to overcome a 
host of obstacles. 
 
4.  In opening remarks, CG Yamauchi emphasized USG concerns for 
the safety and security of AmCits in Vietnam.  At present, there 
is no reliable system of consular notification and access when 
Americans run afoul of the law and are arrested/detained.  This 
unpredictability deprives AmCits (and other foreign nationals) of 
timely access to consular officers and contravenes international 
obligations under the Vienna Convention on Consular Relations.  In 
the case of the U.S., Vietnam often does not fulfill the terms of 
the bilateral Agreed Minute.  While HCMC Office of External 
Affairs efforts to notify the ConGen of AmCit illnesses, injuries, 
and deaths have improved, provincial efforts are still woefully 
lacking in many cases. Prompt consular notification and access are 
indeed linked to Vietnam's reputation as a tourist destination. 
 
5.  On behalf of the HCMC consular corps (30 consulate generals), 
the CG reiterated the need for HCMC to establish a tourist police 
force.  The lack of tourist police means visitors in trouble are 
left to navigate the vagaries of the Vietnamese justice and 
medical systems without much in the way of assistance.  (Post 
Note: This suggestion is one that the consular corps in HCMC has 
put forward to the HCMC government previously.  Since the public 
security/police budget is controlled by the central GVN, the HCMC 
People's Committee has requested additional funding from Hanoi for 
a tourist police force these past two years.  Both times their 
request has been refused.  End note.) 
 
6.  A number of speakers mentioned the difficulty journalists, in 
this case travel writers, have in obtaining visas to visit 
Vietnam.  Travel articles are powerful, cost-free, advertising 
tools, but the onerous visa process limits the number of articles 
on Vietnam.  Moreover, when journalists or any other visitor does 
finally board a plane for Vietnam a rude surprise may await them 
at the other end.  The immigration arrival and customs clearance 
process can be quite lengthy.  One visiting writer told the crowd 
he waited in line for two hours upon arrival, an experience which 
left a "bad taste" in his mouth. 
 
7.  Vietnam's tourism industry is in its infancy, and the human 
resources needed are not always available locally.  Skilled 
managers and marketing professionals are needed, but bringing in 
expat workers involves bureaucratic hassles that the GVN could 
streamline or abolish to encourage tourism development. 
 
8.  American-born entrepreneur turned Thai citizen William 
Heinecke who operates hotels and resorts in Thailand, among other 
successful businesses, pointed out the role of government in 
overall regulation of development.  He noted that everyone agrees 
Vietnam is seriously lacking in various kinds of infrastructure 
and the GVN must sensibly decide where and how those 
infrastructure improvements are made.  Heinecke told the audience 
that no tourist wants to vacation next-door to a new industrial 
processing zone or commercial port.  In his view Vietnam is at a 
crossroads and in many areas the government will have to choose 
between tourism and industrial development.  This is sound advice 
for a country where it is not unheard of to see "eco-tourism zone" 
side-by-side with "industrial park" or "commercial port" on 
government master plans. 
 
Pool Resources for Vietnam Advertising Campaign 
--------------------------------------------- -- 
9. For the tourism industry itself, speakers pointed out several 
key areas for improvement.  Vietnam has no real marketing or 
tourism image, no catchy slogan, no unified ad campaign, and no 
one-stop source of information about the country.  Panelists 
advised Vietnamese counterparts to pool funds for ads designed to 
promote Vietnam as a place, rather than an individual resort or 
tour. 
 
10. One bright spot on the horizon is the recent interest in 
Vietnam by major U.S. airlines.  In the wake of the recent civil 
aviation agreement, American Airlines has hired a local agent and 
set up a new code share arrangement, and United hopes to fly its 
own planes on a San Francisco-Hong Kong-HCMC route within the next 
12 months.  Both airlines helped sponsor the AmCham seminar. 
 
GVN and Industry Partnership Needed 
----------------------------------- 
11.  The role of public-private cooperation was discussed toward 
the end of the seminar.  A speaker from the Pacific Asia Travel 
Association (PATA) related his experiences working on tourism 
campaigns in Hong Kong and Singapore.  He said the key element of 
both successful campaigns was a taskforce made up mostly of 
tourism industry professionals, but headed by a strong figure from 
the national government.  The taskforce leader was someone with 
sufficient stature to effect change within the government, 
whenever it became apparent that a government-induced impediment 
was holding back the industry. 
 
12.  The lack of positive GVN participation, except to promote 
state-owned tour companies, was clearly a frustration for seminar 
attendees.  In a bold comment, a Vietnam Airlines panelist 
complained that no GVN officials other than HCMC's deputy mayor 
attended the seminar, who made opening remarks and then left. 
 
13.  AmCham, through its Tourism Committee, will follow up on 
seminar recommendations and form a Vietnam tourism taskforce 
composed of some non- 
AmCham members as well.  Once the task force is set up, it will 
ask the GVN to participate.  The chairs of the AmCham tourism 
committee will call on the Vietnam Administration of Tourism 
(VNAT) headquarters in Hanoi to "report" the findings of this 
tourism conference to the central GVN authority responsible for 
regulating the industry and promoting Vietnam as a destination. 
 
COMMENT 
------- 
14.  Travel to Vietnam is by no means stagnant.  In 2003, over 2.4 
million foreigners visited, including 220,000 Americans. 
According to VNAT, at least 1.6 million of these visitors came as 
tourists or to visit relatives.  These numbers are down from 2002, 
but the decline was relatively small for a year marked by SARS and 
the war in Iraq.  The long-term trend is one of growth, with 2003 
seeing four times as many visitors as 1993.  The frustration for 
industry insiders is that the share of the market comprised of 
U.S. visitors, who are relatively big spenders, is actually 
shrinking.  According to PATA, Americans made up 17 percent of 
foreign arrivals to Vietnam in 1993.  Today they account for 9 
percent, and Vietnam attracts only 7 percent of American trips to 
Asia. 
 
15.  Vietnamese, European, and Australian travel and tourism 
professionals here wonder what makes American tourists tick.  A 
recurring theme was "We don't understand Americans and need help 
figuring out the U.S. market."  Some portion of the problem may be 
solved by spending money on professional advertising in the U.S. 
and more exposure to American tourists over time.  They seem, 
however, to miss a fundamental point.  Vietnam is far away, and it 
takes a great deal of money and time to get here.  This cuts out 
most American tourists.  For the remaining few, Vietnam will have 
to compete for their tourist dollars by outperforming its 
neighbors.  The increase of U.S. tourists as a function of market 
share will likely be incremental, especially since the GVN seems 
unwilling to do more at this time to market Vietnam as a 
destination.  There may also be a bigger underlying problem -- 
virtually no attention was devoted at the seminar to the subject 
of keeping tourists happy and safe once they arrive. 
YAMAUCHI