American tourists spend a lot when coming to Vietnam

International visitors to Vietnam expected to recover higher than before COVID-19 pandemic in 2024 - Photo: BC

VinaCapital chief economist Michael Kokalari made this observation in a recent report, saying that foreign tourism has brought money to many local businesses, further boosting the economy, albeit indirectly.

Last year, Vietnam's tourism industry contributed 4 percentage points to GDP growth.

It is estimated that although foreign tourists' purchases only account for about 10% of retail sales in Vietnam, this factor still contributes to economic growth this year.

"We estimate the total contribution of tourism to the Vietnamese economy, including direct and indirect contributions, at over 15% of GDP," Mr. Michael Kokalari analyzed.

Domestic tourism accounted for about 4% of Vietnam’s GDP but fully recovered last year. International tourism accounted for about 8% of Vietnam’s GDP before COVID-19, compared with 12% in Thailand. Therefore, a continued recovery in Vietnam’s tourism industry in 2024 could contribute another 1 percentage point to the country’s GDP growth this year.

Delving into the level of recovery in each market, experts noted the recovery in Chinese and American tourist arrivals.

Previously, Chinese tourists accounted for one-third of the total number of foreign tourists to Vietnam, and the number of Chinese tourists only regained the leading position in May 2024.

The return of tourists from China, along with the current high demand for travel from Americans, is forecast to help the total number of foreign tourists to Vietnam this year exceed 5% compared to before COVID-19.

Accordingly, the proportion of Chinese consumers intending to travel abroad has nearly doubled compared to last year, reaching nearly two-thirds of those surveyed. The China Tourism Academy expects Chinese outbound tourists to exceed 80% of pre-COVID-19 levels this year.

Meanwhile in Japan, the sharp decline in the value of the yen is hindering people's overseas travel.

Figures for the first five months of the year also show that the number of Chinese tourists to Vietnam increased by more than 300% compared to the same period last year, reaching 75% of the level before the COVID-19 pandemic. Therefore, VinaCapital expects this source of visitors to recover to 85% of the level before COVID-19 by the end of the year. If achieved, this will be a very high recovery compared to the 30% improvement in 2023.

As for American tourists, according to the Wall Street Journal (WSJ), an unprecedented amount of cash is pouring into the pockets of millions of Americans (especially the "Baby Boomers generation") from their growing investment income and there is much evidence that consumers are spending some of that income on travel.

In Vietnam, the number of American tourists is much higher than pre-COVID-19 levels and their spending has contributed to high occupancy rates at high-end hotels.

Source: https://tuoitre.vn/du-khach-my-chi-tieu-cao-khi-den-viet-nam-20240626174835688.htm