Contributions of tourism to socio-economic development in the midland and mountainous areas of northern Viet Nam

258 CONTRIBUTIONS OF TOURISM TO SOCIO-ECONOMIC DEVELOPMENT IN THE MIDLAND AND MOUNTAINOUS AREAS OF NORTHERN VIETNAM Dr Pham Thai Thuy phamthaithuy2013@gmail.com MSc Le Van Cuong levancuong8@gmail.com Dr Le Thi Thanh Thuy: lethanhthuyhv79@gmail.com Faculty of Economics and Business Administration, Hung Vuong University, Phu Tho, Abstract Recently, tourism development has paid more attention in Northern Vietnam, one of the poorest areas in Vietnam. Many rural and poor local residents are involved in several activities such as hosting tourists, providing traditional foods, drinks, and music performance and selling souvenir, local products. These activities create many opportunities for people to increase their living standards and to build up the rural economy in general. Based on the secondary data in Phu Tho, Yen Bai, Lao Cai, Ha Giang province, the study aims to explore the understanding of the aspects of tourism development. Especially, we are particularly interested in the contributions of tourism development to the four selected provinces‟ economies. We found that the local residents gain more income and having better living standards through active participation in tourism activities. At the provincial level, the results showed that tourism plays an important role in the economy through increasing jobs and budget contribution. The results can be of considerable interest to policy-makers in developing tourism. Keywords: Contribution, Northern Vietnam, Mountainous Areas, Rural Economy, Tourism Development 1. Introduction Nowadays, tourism has significantly developed aiming at the improvement of people‘s living standards worldwide. Tourism experts in the the United Nations Conference on Tourism and International Travel agreed that tourism is the aggregation of relationships, phenomenon, and economic activities that originate in the journeys and stays of individuals or groups outside their regular place of residence or outside their home country for the peaceful purpose. The place they come to stay is not their place of work. This concept is intended to internationalize tourism (United Nations, 1963). In fact, tourism is a business activity including many actors (e.g. tourists, travel agencies, local residents and governments) in response to the needs of the travelers. It is a complex activity as a whole. Therefore, we need to consider all involved actors in tourism activities in order to satisfy their purposes as well as tourists‘ demand. 259 According to the 2017 Law on Tourism (National Assembly of the Socialist Republic of Vietnam, 2017): Tourism is all of activities related to the journey of a person outside his/her usual place not more than one continuous year in order to meet the needs of sightseeing, relaxation, recreation, exploration, discovering tourist resources or combining with other lawful purposes. In this paper, tourism is considered a characteristic activity that people desire journeys/trips out of their residence. Organizations and individuals engaged in tourism business and agencies, organizations, individuals and population communities involved in tourism shall gather services on the basis of exploiting tourist resources so as to satisfy their demands. Tourism plays an important role in the provinces‘ economies: (i) Developing tourism contributes to increasing local region‘s budget and promoting economic development and contributing to economic restructuring at the provincial level (Wurong Shil and Ninh T. H. Do, 2016). Developing tourism will create favorable conditions for local people living in the area to expand their businesses, increase their incomes and improve their living standards through the form of businesses of restaurants, hotels, rest houses, souvenir products, small travel services, etc. As a result, tourism positively contributes the local budget; (ii) Developing tourism will stimulate investment at the provincial level. Tourism is made up of different set of services. Since, investments in infrastructure are often low in profitability, the State often acts as a facilitator for tourism development. Concequence, all classes and businesses will investment in tourism development which will lead to investment in other sectors in the region such as construction, transportation, telecommunication, banking, etc; (iii) Tourism development will attract laborers and create more jobs. It not only brings jobs to the workers themselves but also attracts and creates jobs for other workers in other sectors in the region; (iv) Other socio-cutural aspects also are very important contributions. Tourism development contributes to the spirit of national pride, patriotism, and preserving and promoting the values of the national cultural heritage. Through tourism, people are changing the environment, satisfying the curiosity and at the same time expanding knowledge. Tourism creates conditions for people to open their understanding of cultural history, customs, ethics and social regimes (Le Thi Thanh Thuy, 2015). The Midlands and Mountainous region Northern Vietnam has diversified natural resources, capable of diversifying its economic structure, with its strengths in mineral mining and processing, hydro-power, and tropical agriculture, sub-tropical and temperate products, integrated marine economic development and tourism. The region covers an area of 9,526.7 thousand hectares (accounts for 30.3% of the country's area), with an average population of 11,667.2 thousand people in 2014 with over 20 ethnic groups, of whom the majority are ethnic minorities. The Northern Vietnam is still the most difficult, with double the average poverty rate country. Moreover, due to limited infrastructure, labor resources and living standard, the organization of rural areas has disadvantages compared to tourism organizations in developed areas like cities. 260 This paper focuses on the following issues: (i) overview of tourism development in four selected provinces; (ii) Opportunities, challenges and major directions for tourism development in Northern Vietnam; (iii) Relevant policies recommendation to policy- makers in the region. The Midlands and Mountains in Northern Vietnam are bordered by the three provinces of Guangdong, Guangxi and Yunnan of China to the North, Laos to the West, the Red River Delta to the North. Its location is the great value for long-term development of tourism. 2. Methods In this paper, we combined both macro-level and provincial-level data on tourism to examine the contribution of this sector to the total Gross regional domestic product (GRDP) using national statistics and existing literature. Data collection was conducted in four provinces in Northern Vietnam, the most poorest areas in Vietnam as mentioned before. Based on the research materials (e.g., research monographs, government statistical reports and legal documents, journal and newspaper articles), the authors synthesize issues and contributions of the tourism to four selected provinces as well as Vietnam‘s tourism. Important indicators are employed to explore the contributions such as number of tourists each year, the number of labor, the share of tourism in GRDP, and the investment growth rate of tourism development. To have better understanding of the role of tourism, we applied the SWOT method to analyze the strengths, the weaknesses, the opportunities, and the threats of tourism development. In the analysis process, we delved into the analysis of two combinations: the strengths with the challenge; the weakness analysis with the opportunity to draw some key conclusions about appropriate solutions to boost tourism in the region. 3. Results 3.1. Contributions of tourism to economies Travel and Tourism creates jobs, drives exports, and improve living standards worldwide (World Travel and Tourism Council (2015, 2017). According the data, in 2016, this sector directly contributed GDP was VND 207,789bn (USD9.3bn) (accounts for 4.6% of total GDP); and directly supported 1,960 thousand jobs (accounts for 3.6% of total employment); visitor exports generated VND 184,811bn (USD 8,3bn). Compared to the world ranking (out of 185 countries), total contribution to GDP of Vietnam‘s travel and tourism was at 50 (absolute value in 2016), 104 (relative size in 2016), 17 growth rate (2017 forecast), and 38 long-term growth rate (2017-2027 forecast). The Vietnamese government is paying more attention on tourism development (by increasing investment in this sector), Vietnam‘s tourism and travel attracted capital investment of VND 121,565bn in 2016 and expected to rise by 6.9% over the next ten years. 261 Table 1: Number of tourists’ arrivals in Vietnam Unit: Thousands of Visitors Year Domestic tourists International tourists 2010 28,000 5,049.9 2011 30,000 6,014.0 2012 32,500 6,847.7 2013 35,000 7,572.4 2014 38,500 7,874.3 2015 57,000 7,943.7 2016 62,000 10,012.7 Source: Vietnam National Administration of Tourism, 2017 As showed in Table 1, in 2016 Vietnam received about 10 million international tourists, in 2010 the number was 5.05 million, almost double in size, an increase of 12,09% annually. The number of domestic tourists has increased by 14,17% annually. An increasing number of tourists have opened up and invested in tourism development, making tourism a key driver of socio-economic progress through an increase in national budget, the creation of jobs and enterprises, and infrastructure development. Maps of selected provinces in Northern Vietnam 262 Table 2: Number of tourists’ arrivals in the selected provinces Unit: Thousands of Visitors Indicator 2010 2011 2012 2013 2014 2015 2016 Number of Tourists Ha Giang n/a 273.0 310.4 376.5 403.9 575.7 652.4 Lao Cai 860.0 944.0 974.0 1,050.0 1,130.0 1,278.0 n/a Phu Tho 392.7 429.9 624.0 665.3 731.6 752.2 833.5 Yen Bai 368.2 414.1 417.6 450.8 411.0 342.3 328.7 Domestic Tourists Ha Giang n/a 257.6 293.9 356.5 346.3 516.8 591.7 Lao Cai 611.0 685.0 674.0 758.0 857.0 947.0 n/a Phu Tho 389.8 425.6 619.4 660.6 726.5 747.2 828.0 Yen Bai 358.2 404.7 410.3 444.3 403.6 337.1 324.0 International Tourists Ha Giang n/a 15.4 16.5 20.0 57.6 58.9 60.7 Lao Cai 249.0 259.0 300.0 292.0 273.0 331.0 n/a Phu Tho 2.9 4.3 4.6 4.7 5.1 5.0 5.5 Yen Bai 10.0 9.4 7.3 6.5 7.4 5.2 4.7 Source: Ha Giang, Lao Cai, Phu Tho, Yen Bai, Statistical Yearbook 2011; 2012; 2013; 2014; 2015; 2016 [Online], Statistical publishing house. According to statistics, in 2015, Lao Cai greeted nearly 1,3 million tourist arrivals, of which nearly 0.3 million were international tourists much higher than other provinces. Meanwhile, Ha Giang, Phu Tho, and Yen Bai welcomed 58.9; 5.1; 7.4 thousand international tourists respectively. The main reason is that Lao Cai has the most tourist attractions in the region attracted numerous tourists, such as Sapa and Bac Ha. The places have many hill tribes, as well as rice terraces, lush vegetation, and Fansipan, the highest peak in Vietnam. Another reason is the province is home of many ethnic minorities live making very diversity culture (Truong V. Dao, 2014). Table 3: Contributions of tourism in the four provinces’ economies Indicator 2010 2011 2012 2013 2014 2015 2016 Contribution of Tourisms in GRDP (billion VND) Ha Giang n/a 128.0 136.2 139.6 155.0 173.4 201.0 Lao Cai 224.0 292.5 254.2 260.1 285.0 310.9 n/a Phu Tho 249.7 267.5 291.0 316.0 331.8 362.5 n/a Yen Bai 179.4 204.8 214.6 231.8 233.6 236.3 249.0 Share of Tourism in GRDP (%) Ha Giang n/a 1.5 1.5 1.5 1.5 1.6 1.8 Lao Cai 1.8 2.3 1.7 1.6 1.6 1.6 n/a Phu Tho 1.1 1.2 1.2 1.2 1.2 1.2 n/a Yen Bai 1.9 2.0 1.8 1.8 1.7 1.6 1.6 263 Indicator 2010 2011 2012 2013 2014 2015 2016 Share of Tourism investment in Total development Investment (%) Ha Giang n/a 0.6 0.5 0.1 0.7 1.1 0.6 Lao Cai 2.0 1.9 3.6 1.0 1.5 1.5 n/a Phu Tho n/a n/a n/a n/a n/a n/a n/a Yen Bai 1.1 0.3 2.0 0.5 1.3 0.4 0.4 Source: Ha Giang, Lao Cai, Phu Tho, Yen Bai, Statistical Yearbook 2011; 2012; 2013; 2014; 2015; 2016 [Online], Statistical publishing house. The Table 3 showed how the tourism contributes to the economies in term of GDP contribution. In spite of its importance, the tourism sector only contributed to 1.1 – 2.3% of total GDP. Lao Cai had the largest share of tourism, meanwhile Phu Tho had the lowest share. Based on the results, we can say that tourism still has the great potential for long- term development in the region. Although the tourism industry in Vietnam is still developing, it plays a key economic role in the country. 3.2. Opportunities, challenges and major directions for tourism development Based on the SWOT analysis framework and the current status of tourism development in the midland and mountainous areas in Northern of Vietnam, we analyzed the strengths, weaknesses, opportunities and threats to tourism development in the four selected provinces (see Table 4) Table 4: SWOT analysis in the tourism of the four selected provinces Strengths - Convergence of valuable cultural heritage unique. - The unique cultural status of many ethnic groups, especially ethnic minorities. - A rich source of tourism labor, especially - Travel is a important economic sector and expected to grow quickly - Many attractions: Ha Giang (10), Lao Cai (47), Phu Tho (18), and Yen Bai (7). Weaknesses - Tourism products are still limited, not really promote the true value. - The capacity of the tourism business enterprises is weak. - The lack of professional qualifications of low tourism workers and lack of skills. - Infrastructure is inconsistent between provinces and between tourist zones. - A limitation of travel intelligent investment (modern technology). Opportunities - The local authorities are always interested in creating an open and equal investment environment. - The Communist Party and Government have been developing socio-economic infrastructure. - International economic integration. - Positive impact of Industrial Revolution 4.0 Threats - The awareness and protection of the tourist environment has not been improved. - International integration create the high level of competitiveness within travel agents in Vietnam as well as international - Negative impact of Industrial Revolution 4.0. Source: Authors‟ illustration, 2018 264 * Strengths and challenges Tourism in the midland and mountainous region in Northern Vietnam has many potentials and advantages. It is considered a spearhead economic sector, but in the process of development, tourism encountered competitive pressure from neighboring countries (e.g., Thailand, Laos, and China) is not small. Therefore, it is the competition from the deep integration into the international market as well as the spread of the 4.0 industrial revolution. Besides, the people‘s awareness of environment and cultural protection in the process of tourism development is rather low. The issues raised in this analysis are: - It is necessary to promote propaganda, raise awareness of people and tourists in tourism development, calling for all people to join hands to protect the environment and culture, especially ethnic minorities. - It is necessary to actively and flexibly respond to market changes, to renovate and update information technology in tourism development. - It is important to adapt to the needs, trends of tourism in the world and the region. * Weaknesses and opportunities Although the authorities at the provincial level are very interested, creating environment and policies to attract investment for tourism development. However, the technical infrastructure of tourism is weak and not synchronized, the quality of tourism labor is low, the competitiveness of tourism enterprises is low, tourism products are mainly raw and not well linkage. These are the advantages of tourism products. The issues raised in this analysis are: - It is needed to increase budget for information technology application in promotion, tourism promotion, application of flexible mechanism, ... - It is needed to improve the quality of tourism human resources, especially manpower management, skilled manpower,... - It is necessary to step up investment in, upgrade and improve the system of infrastructure and technical and tourist facilities in a synchronized and modern manner, meeting the requirements of competition, including the system of airports and houses. railway, road traffic system, public transportation, restaurant system, hotel, chamber room, museum system,... The master plan for Vietnam's tourism development up to 2020, with a vision to 2030, with the objective to 2020, to become a spearhead economic sector with professionalism and infrastructure. technical equipment is relatively synchronous, modern; Tourism products of high quality, diverse, branded, bearing bold national cultural identity, compete with other countries in the region and the world. By 2030, Vietnam will become a developing country. In order to contribute to the achievement of the above objective, tourism in the Northern Uplands, Vietnam is determined to: Focus on the development of tourism products based on the outstanding values of tourism resources to create different characteristics of tourism products; Developing tourism in depth, in the direction of 265 improving quality and professionalism; Rapid development to integrate with tourism development in the region, the country and the world. In the master plan for tourism development in the midland and mountainous region in Northern Vietnam up to 2020, the target to 2020, tourism in the mountainous areas in Vietnam has a system of quality tourism products that be diversified, branded, competitive; Highlighting the cultural identity of ethnic minorities in the midland and mountainous areas in Northern Vietnam, attracting tourists to contribute to the preservation and promotion of cultural values of mountainous ethnic groups for tourism development. 3.3. Relevant policies recommendation to policy-makers Based on the literature review and the findings, we propose several policy recommendations to policy-makers as following. To concentrate on developing the most typical tourist form to bring into full play the region's tourism resources. To promote the development of eco-tourism, explore the nature associated with caves, high mountains and midland, associated with the landscape. Develop geological tourism associated with science based on the Dong Van Plateau (Ha Giang). Exploiting the outstanding characteristics of cultural and historical resources in order to promote the market of cultural tourists, sources and spiritual festivals based on the population of historical and cultural relics of Phu provinces. Tho, Yen Bai, Lao Cai. Community tourism, indigenous cultural experience in ethnic minority cultures in the mountains. In addition, in order to promote the "topography" position with the system of border gates and border economic zones, it is necessary to develop border tourism in association with trade in border gates and public services. Strengthening cooperation and linking tourism development Provinces in the region have diverse tourism resources and favorable transport conditions for the development of tourism products with advantages. Linking tourism development in the region will contribute to promote the values of tourism resources to build tourism products characteristic. Linking tourism development to other provinces in the region and other regions will contribute to promoting the value of tourism resources to build integrated tourism products attractive. The content focuses mainly on the development of tourism programs and products, promotion of image promotion and training to improve the quality and quality of tourism labor. Strengthening information technology in promoting and promoting tourism Taking advantage of the support of national tourism agencies, domestic and foreign organizations to implement e-marketing, application of communication technology and social networks to improve the effectiveness of advertising. Develop intelligent tourism model with new technology application programs to bring tourists unique products, services and experiences such as smart travel portal, digital map travel, residential management, mobile applications, traffic management, rescue and rescue, weather information, residential information, data analysis systems, and intelligent travel forecasting. 266 4. Discussion and Conclusion All in all, the case of tourism development in the Midland and mountainous areas in Northern Vietnam contributed new insights into our understanding of its contribution to provincial economies. We find that although the share of tourism sector in GRDP of the four selected provinces is rather small (about 2%) but it is still very promising sector. The findings of this study have several important implications for policy making. As expected, in order to develop tourism in the region, we should implement policies such as: To concentrate on developing the most typical tourist form; To promote the development of eco-tourism; to exploit the outstanding characteristics of cultural and historical resources; to strengthen cooperation and linking tourism development; to create favorable transport conditions, Linking tourism development to other provinces; Strengthening information technology in promoting and promoting tourism, Taking advantage of the support of national tourism agencies, Develop intelligent tourism model with new technology application programs. Thus, policy-makers should focus more on addressing and strengthening tourism sector through the linkage within tours, tourism products within provinces in the region. 5. References 1. Le, T. T. Thuy (2015), Study root tourism development in the source in Phu Tho province, PhD thesis, Hanoi University of Agriculture. 2. Nguyen T.K. Chi and Vien T. 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