Inflation increases domestic tourism prices

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Nguyen Cong Hoan, vice president of Hanoi Redtours, blamed the depreciation of the dong and rising oil and petrol prices for pushing up the cost of domestic tours.

"Our tour packages have almost doubled in price compared to last year," he said.

Hoan added that this time last year, a Hanoi-Hp Chi Minh round trip air ticket cost VND2 million ($100). He said tickets now cost VND4 million ($200).

"Even the cost of hotels and food included in the tour have also increased," he said. "Some of our domestic tour packages have increased to VND8-10 million ($400-500) to meet increasing costs, so it is very hard to attract local customers."

He added that many of his usual customers were now travelling to Thailand, Malaysia and China instead.

Nguyen Huy Hung, founder of nhiepanh.vn, a photographers' forum which regularly organises trips for members, recently booked a two-week trip to Nan Ning in China . "Services in many destinations in Vietnam are not professional, while the price is high. Our members now prefer to travel abroad," he said.

Luong Duy Ngan, president of New Star Tour Company, also said the increasing price of domestic tours had affected his business. A four-day package to Danang is VND5.5 million ($250) and to Phu Quoc Island about VND9 million ($450).

Meanwhile, a seven-day trip to Singapore and Malaysia costs just $598.

"The slight difference between the price of domestic and international tours mean many people are preferring to go abroad. Those places also offer better opportunities for shopping," he said.

"Meanwhile, Vietnam Airlines only flies only once a day to Singapore , which limits our options. But when it starts offering more flights next month, I think more people will choose this package rather than a domestic tour," he said.

Thai Van Chung, Ho Chi Minh City Transport Association's general secretary, said on March 31 there were plans afoot to raise transport fees by 8-10 per cent.

The move is in response to the Ministry of Finance's decision to raise the cost of a litre of petrol on March 29 by VND2,000-2,800 ($0.10-0.14). The rise in transport costs will make it even more expensive to go on holiday in Vietnam, tour operators said.

Pham Trung Luong, deputy head of the Vietnam Institute for Tourism Development Research, said that if domestic tours failed to attract more local customers, a large amount of foreign exchange would flow abroad.

"But we can't expect the price to go down when everything else is increasing. We can't limit people from travelling abroad either," he said.

The tourism development expert said the government should focus on improving the quality of domestic tours.

"The tourism sector is giving priority to promoting the domestic market. It should also have strategies in place to encourage tour companies to offer decent promotion packages for domestic tours," Luong said.