Vietnam sees modest recovery of international tourism

In the context of rapidly changing dynamics in the aviation sector, the Vietnamese Ministry of Transport conducted a mid-year conference on July 10. This forum offered a vital platform to reflect on the challenges and achievements of the first half of the year, and to formulate strategies for the remaining six months.

Vietnam sees modest recovery of international tourism

The resurgence of Vietnam's aviation market was a notable highlight, with passenger numbers soaring to 34.7 million during the first six months of 2023 – a substantial upturn of 49.6 per cent compared to the equivalent period last year. The industry has been successful in meeting passenger demand, as well as gradually restoring a slew of international routes to pre-pandemic levels.

The Civil Aviation Administration of Vietnam has also been proactive in its diplomacy with its counterparts from other nations, negotiating the reestablishment of vital international routes and exploring new international markets. A significant focus of these discussions has been on reviving the strategically important Chinese market.

Accordingly, the ministry has directed the Vietnam Civil Aviation Authority to implement innovative technologies. These include the use of level 2 electronic identification accounts and biometrics to streamline airport procedures, aiming to enhance the passenger experience and operational efficiency.

However, the path to full recovery has not been without its hurdles. Dang Ngoc Hoa, chairman of Vietnam Airlines, outlined the challenges still looming over the sector.

He revealed that the international passenger market has only regained 60 per cent of its former strength, and the recovery in the critical Chinese market languishes at just 9 per cent.

Hoa highlighted the harsh reality faced by many operators by saying, "Operational costs are towering, while the price of airline tickets has hit a six-year low. This is a daunting scenario, and one of Vietnam's prominent airlines has recently sought bankruptcy protection from the government."

Looking to mitigate these challenges, Hoa advocated for tighter regulation of flight slots and called for the retraction of any that are underutilised. He further proposed a reciprocal international flight slot allocation policy between nations.

Echoing this sentiment, Minister of Transport Nguyen Van Thang tasked the Department of International Cooperation and Vietnam Airlines with scrutinising this proposal. This initiative aims to alleviate significant financial burdens caused by airport congestion and inefficient slot allocations.

Despite these difficulties, the ministry remains optimistic about the sector's prospects in the second half of 2023. The domestic aviation market is projected to expand by 7-10 per cent, while the international market is set for an accelerated recovery. By year-end, Vietnam's aviation industry anticipates serving approximately 76.3 million passengers and handling around 1.1 million tons of cargo.

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