“I just applied for a new job at an education consultancy agency. COVID-19 has shown me how risky it is to work in the tourism industry amidst this special time of humankind. I think it is better I follow another career path at this moment,” Dinh Que Chi, my cousin, told me recently. We were talking in Hoi An, a UNESCO World Heritage Site about 30 kilometers from Da Nang – the epicenter of the newest COVID-19 outbreak in Vietnam.
Que Chi grew up in Hoi An and had been working in the city for about two years, at Vinpearl Nam Hoi An Resort and then Nam Hai Resort, before finding herself laid off due to COVID-19. She is just one of many local workers in a similar situation. Right when the Hoi An locals were dreaming of a spectacular “table-turn” for their tourism industry after a 99-day streak of no local transmission in Vietnam and flocks of domestic tourists swarming to this place for summer vacation, a new outbreak emerged. Da Nang has recorded dozens of new COVID-19 cases since July 25, shattering short-lived hopes for a recovery of Hoi An’s tourism.
Hoi An, with its 400-year-history as a mosaic of Chinese-Hokkien, Japanese, as well as Vietnamese culture, as demonstrated through its unique architecture and cuisine, has always been a must-visit for travelers to Vietnam. In 2019, the total number of visitors staying here was estimated at 5.35 million. According to the Municipal Bureau of Culture and Information, 90 percent of overnight visitors to Hoi An are foreigners. In the first nine months of 2019, tourism directly brought 4.4 trillion Vietnamese dong ($191 million) to the ancient town, and social income from the tourism sector was recorded at 10.340 trillion dong.
Nevertheless, the juggernaut of COVID-19 turned the world upside down for all local citizens. With the pandemic spreading worldwide, from March 22, the Vietnamese government declared a temporary suspension on the entry of all foreign nationals. This travel ban has caused incalculable losses to local businesses. The average rent in the old town area is normally around 100 million dong ($4,235). With such an extravagant price and no tourists, many cloth shops, restaurants, and local accommodation establishments whose targeted customers are foreign travelers have been forced to cut staff – or even pushed into bankruptcy — after the travel ban. Local people like my cousin, Que Chi, became jobless overnight, struggling to make ends meet. The once-crowded ancient streets are deserted.
I talked with Huynh Thi Nhu Nhu, a young entrepreneur who had to give up her villa-for-rent business after only 3 months of operation due to COVID-19. “We used to earn up to 100 million dong monthly; however, after the interdict banning foreign entries was issued, we could hardly pay the rent. The owner of the villa refused to negotiate, so we had to close our business,” said Nhu with disappointment. According to her, travel agencies and lodgings with a special focus on Korean or Chinese tourists, who together accounted for 56 percent of Vietnam’s international arrivals in 2019, have been hit hardest by the pandemic.
It’s not just Hoi An — Vietnam’s tourism industry in general has been suffering severely. International arrivals to the country in March 2020 numbered only about 450,000, a decrease of 63.8 percent from the previous month. Compared to the same period last year, the number of international tourists to Vietnam had decreased by 68.1 percent.
Toward the beginning of June, the pandemic situation in Vietnam was kept under good control thanks to an efficient, low-cost model of containment, which has already made a name for itself worldwide. Recognizing the opportunity to save its tourism sector, the Vietnamese Ministry of Culture, Sports, and Tourism issued Plan No. 1749 to launch the “Vietnamese people traveling to Vietnam” program from June 1, with a view toward galvanizing domestic tourism demand. Hoi An turned a little vibrant again. Hotels, tourist spots, and travel agencies released a great number of discount packages in the hope of attracting domestic visitors to the town. On weekends, about 3,000 Vietnamese tourists were reported to have visited the city.
Unfortunately, the new outbreak since July 25 has led to massive cancellations of bookings in Hoi An, reminding not only the local people but also the Vietnamese government that COVID-19 is here to stay. Hoi An has become a ghost town again.
I visited Tan Ky Ancient House on the morning when the news of COVID-19 infections in Da Nang was confirmed. I was not surprised on hearing from the tour guide (who wished to remain anonymous): “You are the very first guest today, and I highly suspect that you would be the only one. I was informed that about 2,000 people just cancelled their bookings at Hoi An Silk Village for fear of the new wave of infection.” According to the tour guide, Tan Ky Ancient House used to welcome up to 1,000 guests per day before the pandemic.
“The prediction is that not until 2023 would Hoi An tourism be able to recover. I am extremely pessimistic about my near future, and I think my worries are shared among all the locals,” she added.
With no fatalities due to COVID-19, Vietnam has undoubtedly gained a good reputation for handling the pandemic. Its success throughout the first wave of infections convinced experts to adopt a positive outlook for the country’s economy. The country’s 2020 GDP growth — predicted to be around 4.8 percent as forecasted by Asian Development Bank — will very likely be the best in Southeast Asia.. Vietnam is one of only four Fitch-rated sovereigns in the Asia Pacific (APAC) that Fitch Ratings expected to post positive economic growth in 2020.
However, tourism and exports continue to suffer. Moreover, according to Pham Do Chi, a Vietnamese former expert at the International Monetary Fund, Vietnam cannot avoid the social and economic ramifications of the pandemic. According to preliminary calculations and reports from localities, as of June 2020, the whole country had 30.8 million people aged 15 and over who had been adversely affected by the pandemic, including those who lost their jobs, had to reduce working hours, or otherwise had their income cut down. At the Sixth Conference of the Executive Board of the Vietnam General Confederation of Labor, held in the morning of July 3 in Hanoi, it was revealed that the average salary increase for laborers had dropped significantly, only 8.3 percent compared to 19.4 percent this time last year.
Now a second wave of infections has come. With confidence in the experience it has gained so far, the Vietnamese government is responding promptly with strict measures. However, the big question to be tackled now is not merely about how to contain the virus, but also how to address the extreme economic losses awaiting in the yet-to-be-seen aftermath of the pandemic. Putting the country under social distancing again would mean increased bankruptcy, debts, and joblessness. As a recently published report from the World Bank noted: “If, overall, the economy has been resilient, many individual businesses and people have been exposed to the harsh realities of the pandemic.”
What is happening in Hoi An is a perfect example of this reality. “Those making positive forecasts definitely have not come to Hoi An. People here are struggling, and I don’t know when this will end. Even when we have the vaccine, people need to work and earn money before they could travel again,” complained a man I met in Mun Cafe near the ancient streets.
Considering Hoi An’s proximity to the Da Nang epicenter and the fact that thousands of people were coming to the city right before the outbreak, the ancient town will be under a social distancing mandate starting from midnight on July 31. The future of a recovery, for many locals, is dim.
Pham Thi Thuy Duong is a Yenching scholar at Yenching Academy of Peking University and a Baixian scholar at Baixian Asia Institute.