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UCCRTF Cities in Viet Nam Suffer Tourism Shock from COVID-19

December 2020

Over the past decade, tourism has grown to become a vital economic sector for Viet Nam. In 2019, Viet Nam received 18 million international arrivals, up from just over 2 million in the year 2000. However, the COVID-19 pandemic has severely affected the industry. In March 2020, Viet Nam suspended the issuance of all tourist visas and implemented other measures to stop the spread of the disease, including closure of leisure facilities, enforcing social distancing and banning meeting in large groups. As of November 2020, the country remains closed to foreign tourists. The country recorded a 98 percent year-on-year drop in foreign visitors for April 2020. With no reopening for tourists in sight, the government has called for the promotion of domestic tourism.


COVID-19 and the measures that have been put in place to contain it have affected cities in which ADB’s Urban Climate Change Resilience Trust Fund (UCCRTF) works, including Hue, Da Nang, and Hoi An. The impact of COVID-19 on the tourism sector is particularly problematic as the tourism value chain is extensive, encompassing leisure, entertainment, shopping, hotels, and other related services. This has posed significant challenges for cities like Hoi An, which have sought to refocus their attention on attracting visitors from closer to home.

In 2019, Hoi An had a total production value from tourism and services estimated at more than VND 8.5 billion ($ 372 million). The city attracted over 4 million international visitors and was hailed as Asia’s top cultural city destination in the same year. Unfortunately, because of COVID-19, Hoi An’s share of visitors in the first six months of 2020 was down nearly 70 percent compared with the same period in 2019. The number of international visitors has also decreased by more than 70 percent. Hue city faced similar challenges losing about VND 2.25 billion ($ 97 million) in revenue from tourism in the first six months of 2020, with visitor numbers down by 55 percent. There are also likely to be repercussions throughout the wider population, as gender analysis of the labor divide within the tourism sector shows there to be a high proportion of female workers whose livelihoods may be at risk.

In response to this situation, Hue city decided to move away from its long-term policy position of promoting international tourism and instead is pivoting to encourage domestic tourism. In May 2020, Hue organized the Hue Tourism Forum with the theme “Connecting Tourism: Hue - a safe and friendly destination” to implement actions that would promote domestic tourism and support the local tourism industry. The city is now making greater effort to develop and organize festivals and events to attract more local tourists while costs of sightseeing tickets have been reduced. Hue, Da Nang, and Quang Nam cities have also implemented joint action programs to enhance their cooperation and joint promotion of the different tourism strengths each city has to offer.

“The pandemic gives us many lessons about building crisis funds, the development orientation of walking on both feet, developing international and domestic tourism markets,” said Associate Professor Dr Pham Hong Long - Head of Faculty of Tourism Studies, University of Social Sciences and Humanities, Hanoi National University. “In order to revive the tourism industry in the current context, we must focus on the domestic tourism market with attractive and unique products.”

The Tourism Association of Da Nang city has conducted communications campaigns to improve tourist demand. This includes the “Da Nang misses you - Da Nang is back” campaign to emphasize the message that Da Nang is ready to welcome visitors back from early November to late December. Da Nang will target local customers first, domestic customers, and finally, international customers at the end of this year. Dan Nang is now cooperating with other tourism-centered cities in the central coastal region of Viet Nam, including Hue and Quang Nam. Together, they have implemented a program to recover and develop tourism and enhance the cooperation and promotion of the tourism strengths of each city after the COVID 19 pandemic. This is a vital step in the national approach to tourism recovery as more than 80 percent of international visitors to Viet Nam visit at least one of these three cities.

COVID-19 demonstrates the impact of a large-scale, system-level shock on the tourism sector. There are many parallels to be drawn with the impacts that climate change can bring. Viet Nam’s proactive steps to diversify the sources of tourism will help to build the resilience of the industry. Beyond this, cities can plan for a sustainable tourism sector after the pandemic is under control, and simultaneously build resilience to climate change by making improvements to their urban environment. Investments in transport infrastructure that encourages walking and cycling, for instance, can help to improve air quality, reduce the negative health impact of extreme heat events, and make streets safer and more enjoyable for tourists and citizens alike.

UCCRTF is supporting the City of Hoi an in Viet Nam under Grant No. 0462 – VIE: Flood Forecasting and Warning System for Hoi An and Vu Gia-Thu Bon River Basin. It is linked to ADB Loan 43237-013 Urban Environment and Climate Change Adaptation Project.

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  • Thanh Van
    UCCRTF Country Resilience Officer for Viet Nam
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