Da Nang seeks to cut low-cost tours in favour of sustainable tourism

The Golden Bridge in Da Nang city

Although low-cost tours or the so-called “zero dong” tours have catered to an increasing number of tourists visiting the city in recent years, there is a growing concern about their impact on the local economy. Customers on such budget tours are forced to follow the agencies’ itinerary, often visiting tourist attractions, restaurants and shopping malls where payments are electronically transferred back to foreign countries, leaving little to no profit for Da Nang city.

Beyond this, the demand for budget tours has sparked competition between travel companies and service industry businesses, eager to capitalise on the city’s popularity while avoiding paying taxes to local authorities.

According to Ngo Quang Vinh, Director of the municipal Department of Tourism, the rise of budget tours is not unique to Da Nang and studies have shown their impact on markets in neighbouring countries, such as Thailand and Cambodia. Statistics showed that low-cost tours make up 30 percent of the total tourism market in the region.

In a bid to reduce the number of cheap tour operators, Da Nang city is working with relevant agencies to ensure that visitors make proper payments in line with regulations. Enhancing inspections at local shops and restaurants has been prioritised to detect fraudulent trade and tax evasion.

The city is now channeling its focus on improving standards for travel agents while simultaneously working to ensure that shopping malls operate in accordance with regulations. Plans are in motion to set up representative offices in China and the Republic of Korea where greater scrutiny can be applied to package tours sold there.

Meanwhile, sustainable tourism products will be monitored to ensure that they continue to attract high-end tourists, generating higher revenues and benefits for the local population.

Da Nang’s tourism sector has grown exponentially, with an average annual growth of 20.06 percent between 2013 and 2017.

Last year alone, it hosted 6.6 million tourists, including 1.67 million foreigners. From the outset of 2018, the city welcomed around 6.5 million visitors, up 27.7 percent from the same period last year, of whom 2.4 million were foreign travellers. Total revenue gained from the tourism sector was estimated at 14 trillion VND (597 million USD), a year-on-year increase of 12.3 percent.

The city has bolstered its promotion of tourism in Thailand, Indonesia, Hong Kong (China), Japan and the Republic of Korea, and expanded efforts in Australia, Western Europe and Russia.

Da Nang city remains a popular tourist destination in central Vietnam and continues to develop. The online marketplace and hospitality service Airbnb announced listings of the world’s top 10 destinations for 2018, in which the city ranked fifth with a 255 percent growth in bookings.