Duty-free goods 'fuel' tourism

Ho Chi Minh City must be a "shopping paradise"

In a document recently sent to the Ho Chi Minh City People's Committee, billionaire Johnathan Hanh Nguyen's Inter-Pacific Group (IPPG) said the company has worked with Saigon Tourist Corporation (Saigontourist) to discuss a business cooperation proposal at the Parkson Saigon Tourist Plaza building (35bis-45 Le Thanh Ton, Ben Nghe Ward, District 1).

Accordingly, IPPG Group wishes to receive the entire building so that the two sides can coordinate in planning investment, upgrading, equipment, and detailed design. In addition to the exploited Parkson premises, IPPG proposes to exploit more premises on the ground floor, especially the premises at the corner of Le Thanh Ton - Dong Khoi Street, to build a duty-free store on the street, making the central area of ​​Ho Chi Minh City more bustling and elevating the Saigon Tourist Plaza building, ensuring economic benefits for both parties.

IPPG's idea is to build Parkson Saigon Tourist Plaza into a shopping mall combined with luxury, international-class integrated dining and entertainment services (all-in-one destination). Basically, all parties have shown goodwill and IPPG is waiting for Saigontourist to provide more information on legality, current planning, agreements with brands, and existing tenants in the building.

Immediately after receiving the information and documents provided by Saigontourist, IPPG will promptly complete the proposal for effective cooperation and exploitation for Parkson Saigon Tourist Plaza.

Parkson shopping mall on Le Thanh Ton street (District 1) is being proposed to become the first underground duty-free shopping mall in Ho Chi Minh City.

"Currently, as a leading fashion distributor in Vietnam with more than 108 international brands, we need business premises in the center of Ho Chi Minh City to open downtown duty-free stores and high-end fashion boutiques. From there, we will move towards the brands agreeing to open factory outlets in Thu Duc City to stimulate tourism in Ho Chi Minh City," said the leader of IPPG.

According to research, the factory outlet area in Thu Duc City that IPPG mentioned is part of the overall project "Premium Outlet Commercial Service Urban Area" that this enterprise has sent to the People's Committee of Thu Duc City and the People's Committee of Ho Chi Minh City. The urban area is expected to be 145 hectares wide in Truong Tho Ward, including a world-class Premium Outlet shopping area; a complex of commercial, tourism and service functions focusing on branches of financial companies, banks, offices, shopping stores, entertainment complexes, etc.

In particular, the main axis of this area will be developed following the model of the famous commercial axis Orchard Road in Singapore with diverse shopping spots from branded goods to high-class international cuisine. In addition, there is also a night food street following the model of Clarke Quay street in Singapore; an entertainment street with bars, pubs, super bar models, pubs, cool bars or party saunas... appearing for the first time in Thu Duc.

In fact, since 2020, the "king of luxury goods" has begun to ambitiously open large shopping centers and duty-free stores on the street for tourists when signing a cooperation agreement with Trang Tien Plaza (Hanoi) and Lotte PK Duty Free to develop duty-free store chains across Vietnam. At the end of 2022, Vietnam's first duty-free store on the street will officially open to welcome visitors in Da Nang, marking a major turning point for the shopping tourism market.

Explaining more clearly about the goal of forming high-class shopping areas in Ho Chi Minh City, Mr. Johnathan Hanh Nguyen said: Without shopping, tourism and the night-time economy cannot be developed. The 10-year socio-economic development strategy (2021 - 2030) has identified the direction and task of promoting Ho Chi Minh City to become an international financial center. The resolution was approved by the City People's Council along with a strategy to invite international enterprises to cooperate. Currently, Long Thanh International Airport is being built with a scale of 100 million passengers/year, becoming a hub for the region and the world.

In addition, businesses like IPPG have negotiated with suppliers to achieve prices equal to those in France and Singapore and lower than those in China, despite retail and tax. If conditions are created to form factory outlets and duty-free shops on the streets, Vietnam will be a "magnet" attracting international visitors to spend money.

Fertile land left open

Supporting the IPPG project, Dr. Luong Hoai Nam, a member of the Tourism Advisory Board (TAB), assessed that shopping tourism is a very large market, a fertile land that Vietnam is still leaving open. "Travel enthusiasts" can spend more than half of their trip time on shopping. Vietnamese people themselves when traveling abroad also invest a lot of time in shopping. However, in Vietnam, duty-free shopping areas and factory outlet areas have been talked about for decades but have not been implemented yet.

The duty-free shop model in Vietnam has always been limited to international airports, with certain limitations when visitors arriving and departing from the airport sometimes do not have the need or have limited time to shop. The VAT refund for tourists who shop when returning home is still at a very rudimentary level, with many shortcomings, and few people take advantage of it.

Meanwhile, tourist countries such as Singapore, Japan, Thailand… are doing very well and are increasingly improving policies and tax refund solutions for tourists with a convenient system. Thanks to that, when mentioning shopping paradise, tourists immediately think of Singapore, Thailand, even China, but no one mentions Vietnam.

Ho Chi Minh City must have high-class shopping and entertainment areas to attract international visitors to spend money.

In fact, every year, Vietnamese travel companies organize tens of thousands of tours to bring Vietnamese tourists to Singapore, Thailand, Japan, Korea, etc. just to stimulate consumption in their neighboring countries. Many lessons in the world have shown that duty-free shops in the city are an opportunity to attract wealthy tourists.

Many countries have successfully built duty-free shops right in shopping centers, far from seaports and airports, and have earned billions of foreign currency each year from this business even though… they do not have to collect taxes.

For example, in Korea, the size of the duty-free market reached more than 17 billion USD, China reached 6 billion USD in 2018. In Singapore, Changi Airport alone, considered a shopping paradise, in 2018 revenue from duty-free goods in the airport reached 1.5 billion USD and was in the top 3 airports with the largest tourist spending.

In Japan, international student Nguyen Vu said that duty-free shops are the main activity point in Tokyo's Akihabara electronics shopping district. They are always crowded with foreign tourists because of the cheap prices thanks to not having to pay additional consumption tax. The Philippines has a shopping mall called Duty Free Philippines Fiestamall. The goods sold in this shopping mall are imported from countries around the world and the special thing is that these items will not be sold in any other shopping mall in the country. Similarly, the island nation of Singapore is considered a "shopping paradise" for tourists due to the system of duty-free shops in the malls.

According to Mr. Luong Hoai Nam, for the tourism industry, we must identify services and trade as key products. Only a service system can penetrate the people, promoting the development of other industries along with tourism. If we want tourism to develop, we must have extremely diverse entertainment and recreation service complexes that create great attraction and "huge" revenue like Marina Bay and Sentosa in Singapore. Vietnam is lacking such places to meet the needs of tourists to kill time and spend money in a safe and civilized manner.

In order for Ho Chi Minh City and Vietnam to become a shopping paradise, it is necessary to comprehensively resolve current shortcomings, from land funds to form sales points in the city, factory outlet systems near the city or suburbs... to tax exemption and reduction policies, on-site VAT refund systems at shopping points with simple and easy procedures.

Dr. Luong Hoai Nam, member of the Tourism Advisory Board

Source link: https://thanhnien.vn/hang-mien-thue-tiep-suc-du-lich-185231013190856276.htm