COUNTRY FOCUS VIETNAM
NEENA DHILLON, JOURNALIST, SPA BUSINESS
“T
he tourism sector has been a major factor in job creation, eco- nomic development and poverty allevi-
ation in Vietnam, leaving no doubt that it’s played a crucial role in our country’s overall socioeconomic progress.” When Vietnam’s state vice-president Nguyen Thi Doan addressed the World Travel & Tour- ism Council last year, she wasted little time in underlining the signifi cance of tourism to her nation. Having accounted for 4.5 per cent of GDP in 2012, forecasts predict a per annum increase of 6.7 per cent until 2023. With its stunning natural landscapes, cultural riches, hospitable people and a favourable climate, it’s easy to see why Viet- nam is ranked among the top three emerging tourism destinations worldwide.
A CIVETS ECONOMY The country’s tourism growth feeds into a larger picture; one that has seen Vietnam positioned as one of Asia’s most exciting eco- nomic prospects behind China. Indeed since fi nancial and political reforms – termed as doi moi (or restoration) – were initiated in
We consider the opportunities and challenges for tourism and spa businesses in Vietnam, one of the emerging CIVETS economies
1986 to facilitate the transition from a cen- tralised planning system to a multi-sector market economy, Vietnam has posted annual per capita growth of 5.3 per cent, according to McKinsey. Throughout the 90s the coun- try became a global investment darling and in 2007, the same year it joined the World Trade Organization, it attracted more for- eign direct investment than the majority of other Asian tiger economies. The factors that underlined this success varied from a young, fl ourishing labour force to a notable shift from agriculture into manufacturing and service-based industries.
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Vietnam’s reputation as an enticing invest-
ment market was further cemented when the Economist Intelligence Unit identifi ed it as a CIVETS nation in 2009. An acronym champi- oned by former HSBC chief executive Michael Geoghegan, CIVETS encapsulates six coun- tries – Colombia, Indonesia, Vietnam, Egypt, Turkey and South Africa – all of which have been earmarked as the new batch of emerg- ing economic powerhouses, following in the footsteps of BRIC countries. Speaking of the CIVETS, Geoghegan has observed: “Each has a large, young, growing population. Each has a diverse and dynamic economy. And each, in relative terms, is politically stable.” Yet Vietnam’s economy has, more recently,
lost some of its roar due to concerns about inflation, bad bank debts, falling foreign investment and corruption scandals among its state-owned enterprises. This meant that in 2012 the country’s growth slowed to its weakest pace in 13 years, with GDP increas- ing by only 5.03 per cent. In April 2013 the IMF then lowered Vietnam’s growth pro- jections into 2014, raising questions about the ruling party’s ability to reform the frag- ile banking system and state-owned fi rms that dominate the economy.
Spa Business 3 2013 ©Cybertrek 2013
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