Tourism Vietnam - q3 - 2013

Q3 2013
www.businessmonitor.com
VIETNAM
TOURISM REPORT
INCLUDES 5-YEAR FORECASTS TO 2017
ISSN 1747-9061
Published by:Business Monitor International

Vietnam Tourism Report Q3 2013
INCLUDES 5-YEAR FORECASTS TO 2017
Part of BMI’s Industry Report & Forecasts Series
Published by: Business Monitor International
Copy deadline: June 2013
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CONTENTS
BMI Industry View ............................................................................................................... 7
SWOT .................................................................................................................................... 8
Political ................................................................................................................................................... 9
Economic ............................................................................................................................................... 10
Business Environment .............................................................................................................................. 11
Industry Forecast .............................................................................................................. 12
Inbound Travel ...................................................................................................................................... 13
Table: Vietnam Inbound Tourism, 2010-2017 .......................................................................................................... 13
Table: Vietnam Inbound Tourism Top 10 markets by arrivals, 2010-2017 ('000) ..................................................................... 14
Outbound Travel .................................................................................................................................... 15
Table: Vietnam Outbound Tourism, 2010-2017 ........................................................................................................ 15
Table: Vietnam Outbound Tourism, Top 10 Markets by Departures, 2010-2017 ('000) ............................................................... 17
Travel .................................................................................................................................................. 17
Table: Vietnam Methods of Travel, 2010-2017 ......................................................................................................... 18
Hotels .................................................................................................................................................. 18
Table: Vietnam Hotel Accommodation 2010-2017 ..................................................................................................... 19
Table: Vietnam Domestic Hotels and Restaurants Industry Value, 2010-2017 ........................................................................ 19
Economic Analysis ............................................................................................................ 21
Economic Outlook ................................................................................................................................... 21
Table: Vietnam - Economic Activity .................................................................................................................... 24
Industry Risk Reward Ratings .......................................................................................... 25
Tourism Risk Rewards Ratings ................................................................................................................. 25
Table: Asia, Risk and Reward Ratings .................................................................................................................. 25
Security Risk Reward Ratings ................................................................................................................... 27
Table: Asia Pacific Regional Security Ratings ......................................................................................................... 27
Market Overview ............................................................................................................... 29
Table: Vietnam Major Infrastructure Projects ......................................................................................................... 30
Table: Top 10 Global Hotel Groups Present in Vietnam ............................................................................................... 31
Company Profile ................................................................................................................ 33
Huong Giang Tourist Company .................................................................................................................. 33
Saigontourist .......................................................................................................................................... 34
Global Industry Overview .................................................................................................. 35
Table: Total Receipts By Country, 2012-2013, (US$bn) ............................................................................................... 36
Table: Global Sporting Calendar, 2013-2022 .......................................................................................................... 38
Global Assumptions .......................................................................................................... 40
Table: Global Assumptions ............................................................................................................................. 41
© Business Monitor International Page 4

Table: Global And Regional Real GDP Growth, % chg y-o-y ......................................................................................... 43
Developed States .................................................................................................................................... 44
Table: Developed States, Real GDP Growth Forecasts ................................................................................................ 44
Emerging Markets .................................................................................................................................. 46
Table: Emerging Markets, Real GDP Growth Forecasts .............................................................................................. 46
Table: BMI Versus Bloomberg Consensus Real GDP Growth Forecasts (%) ......................................................................... 48
Demographic Forecast ..................................................................................................... 49
Table: Vietnam's Population By Age Group, 1990-2020 ('000) ........................................................................................ 50
Table: Vietnam's Population By Age Group, 1990-2020 (% of total) .................................................................................. 51
Table: Vietnam's Key Population Ratios, 1990-2020 .................................................................................................. 52
Table: Vietnam's Rural And Urban Population, 1990-2020 ........................................................................................... 52
Methodology ...................................................................................................................... 53
Methodology ........................................................................................................................................... 53
Tourism Industry .................................................................................................................................... 53
Tourism Ratings - Methodology ................................................................................................................ 54

BMI Industry View
BMI's Vietnam tourism report looks at the strong long term potential for growth offered by this expanding
market in the Asia Pacific region. The forecasted increases in inbound tourism combined with an improving
domestic economy and higher outbound travel all point towards a very positive future for the Vietnamese
tourism industry.
2010, 2011 and 2012 saw substantial increases in inbound arrivals with particularly strong growth of
19.09% in 2011. While we don't expect this exceptional growth to continue, we do expect to see not
insubstantial growth of close to 6% per year for the remainder of the forecast period to 2017 with total
inbound arrivals expected to reach over 9mn that year. Outbound travel from Vietnam is expected to show
even stronger year-on-year (y-o-y) growth, increasing from 3.1mn in 2012 to 5.5mn in 2017 as the domestic
economy continues to expand.
2013 saw the launch of the National Tourism Year, reflecting the Vietnamese government's prioritisation of
the industry. As part of efforts to expand the tourism market the government is also making a series of
investments in improving the country's transport infrastructure, with expansion of the international airports
including a new terminal at Noi Bai Airport in Hanoi and investments in the country's rail network.
Vietnam has a wide range of tourist attractions. The picturesque beaches of Phu Quoc and Ha Long Bay
bring in leisure travellers, while the eco and wildlife tours cater for the more adventurous. The country also
has a wide variety of cultural attractions such as Thien Mu Pagoda and historical attractions like the Ci Chi
Tunners (used by the Viet Cong during the Vietnam War). As such there is plenty to entice first-time
travellers, and to encourage their return.
■ Hotels continue to expand their presence in Vietnam, with several major resorts due to open in the future.
BMI expects that the value of the hotel industry will increase by between 11.7% and 12.9% per year
between 2013 and 2017.
■ The government continues to invest in improving the country's transport infrastructure, including the
building of a new international airport due to open by 2020.
■ Arrivals will continue to be dominated by countries from within the Asia Pacific region particularly
China, South Korea and Japan.
■ Key events in Vietnam in 2013 include the Ho Chi Minh City Flower Festival, the Hung Kings Festival,
the International Tourism Expo in September and various sporting events.
■ This quarter BMI has given Vietnam an overall Tourism Risk/Reward rating of 59.3, placing it ninth in
the Asia Pacific region, ahead of Malaysia but behind New Zealand.

SWOT
Vietnam Tourism SWOT
Strengths ■
The Vietnamese government is very supportive of the tourism industry, actively
promoting the sector and investing in infrastructure.
■
The country is in a prime position to take advantage of expanding markets in the Asia
Pacific region.
■
A range of tourist attractions give the country enduring appeal.
Weaknesses ■
The government is still prone to arbitrary and disruptive policy decisions at the
macroeconomic level.
■
The health service is rudimentary, deterring some foreign visitors.
■
Some sectors of the tourism infrastructure are in need of extensive modernisation.
Opportunities ■
Tax breaks are offered to foreign investors encouraging investment.
■
The government is easing some visa requirements opening the country to a wider
range of visitors.
Threats ■
Other countries in the region, such as Thailand, are more established tourist
destinations for Westerners.
■
Recovery in other regional tourism markets could encourage a shift away from
Vietnam.
■
A downturn in the global economy could depress inbound arrivals.

Political
SWOT Analysis
Strengths ■
The Communist Party of Vietnam remains committed to market-oriented reforms and
we do not expect major shifts in policy direction over the next five years. The one-
party system is generally conducive to short-term political stability.
■
Relations with the US have witnessed a marked improvement, and Washington sees
Hanoi as a potential geopolitical ally in South East Asia.
Weaknesses ■
Corruption among government officials poses a major threat to the legitimacy of the
ruling Communist Party.
■
There is increasing (albeit still limited) public dissatisfaction with the leadership's tight
control over political dissent.
Opportunities ■
The government recognises the threat corruption poses to its legitimacy, and has
acted to clamp down on graft among party officials.
■
Vietnam has allowed legislators to become more vocal in criticising government
policies. This is opening up opportunities for more checks and balances within the
one-party system.
Threats ■
Macroeconomic instabilities in 2012 are likely to weigh on public acceptance of the
one-party system, and street demonstrations to protest economic conditions could
develop into a full-on challenge of undemocractic rule.
■
Although strong domestic control will ensure little change to Vietnam's political scene
in the next few years, over the longer term, the one-party-state will probably be
unsustainable.
■
Relations with China have deteriorated over recent years due to Beijing's more
assertive stance over disputed islands in the South China Sea and domestic criticism
of a large Chinese investment into a bauxite mining project in the central highlands,
which could potentially cause wide-scale environmental damage.

Economic
SWOT Analysis
Strengths ■
Vietnam has been one of the fastest-growing economies in Asia in recent years, with
GDP growth averaging 7.1% annually between 2000 and 2012.
■
The economic boom has lifted many Vietnamese out of poverty, with the official
poverty rate in the country falling from 58% in 1993 to 14.0% in 2010.
Weaknesses ■
Vietnam still suffers from substantial trade, current account and fiscal deficits, leaving
the economy vulnerable to global economic uncertainties in 2012. The fiscal deficit is
dominated by substantial spending on social subsidies that could be difficult to
withdraw.
■
The heavily-managed and weak currency reduces incentives to improve quality of
exports, and also keeps import costs high, contributing to inflationary pressures.
Opportunities ■
WTO membership has given Vietnam access to both foreign markets and capital,
while making Vietnamese enterprises stronger through increased competition.
■
The government will in spite of the current macroeconomic woes, continue to move
forward with market reforms, including privatisation of state-owned enterprises, and
liberalising the banking sector.
■
Urbanisation will continue to be a long-term growth driver. The UN forecasts the
urban population rising from 29% of the population to more than 50% by the early
2040s.
Threats ■
Inflation and deficit concerns have caused some investors to re-assess their hitherto
upbeat view of Vietnam. If the government focuses too much on stimulating growth
and fails to root out inflationary pressure, it risks prolonging macroeconomic
instability, which could lead to a potential crisis.
■
Prolonged macroeconomic instability could prompt the authorities to put reforms on
hold as they struggle to stabilise the economy.

Business Environment
SWOT Analysis
Strengths ■
Vietnam has a large, skilled and low-cost workforce, which has made the country
attractive to foreign investors.
■
Vietnam's location - its proximity to China and South East Asia, and its good sea links
- makes it a good base for foreign companies to export to the rest of Asia, and
beyond.
Weaknesses ■
Vietnam's infrastructure is still weak. Roads, railways and ports are inadequate to
cope with the country's economic growth and links with the outside world.
■
Vietnam remains one of the world's most corrupt countries. According to
Transparency International's 2012 Corruption Perceptions Index, Vietnam ranks 123
out of 176 countries.
Opportunities ■
Vietnam is increasingly attracting investment from key Asian economies, such as
Japan, South Korea and Taiwan. This offers the possibility of the transfer of high-tech
skills and know-how.
■
Vietnam is pressing ahead with the privatisation of state-owned enterprises and the
liberalisation of the banking sector. This should offer foreign investors new entry
points.
Threats ■
Ongoing trade disputes with the US, and the general threat of American
protectionism, which will remain a concern.
■
Labour unrest remains a lingering threat. A failure by the authorities to boost skills
levels could leave Vietnam a second-rate economy for an indefinite period.

Industry Forecast
BMI View: We are expecting to see growth across
all areas of the tourism market in Vietnam between
2013 and 2017. An improving domestic economy is
boosting outbound travel and further growth in the
region is also driving up inbound travel, particularly
from major markets like China. As such the market
offers enormous potential for long term return on
investments.
Outbound travel has seen substantial growth in
recent years, with over 17% growth in 2012. While
we expect the rate of growth to decline slightly we
do expect it to continue to remain impressive at over
11% growth y-o-y. This growth is based on the
increasing strength of the domestic economy in
Vietnam, resulting in a growing middle class with
more disposable income to spend on travel, as well
as an improvement in international travel connections. As a result BMI is forecasting that the total outbound
travellers from Vietnam will reach over 5.5mn by 2017.
Inbound travel will see a similar increase, dependent on the recovery of the global economy and the
continued growth of the travel market in the Asia Pacific region, with annual arrivals expected to reach over
9mn by 2017.
Vietnam already benefits from relatively well developed international transport links, with several
international airports. However if tourism numbers are to continue to rise then the country will need to
make substantial investments in the improvement and expansion of airport facilities. The country's rail
network will also need to be expanded, as will the road network is tourism to the further regions of the
country is to be expanded. The country's 15 domestic airports provide good regional connectivity.
Most of the major hotel groups have some presence in Vietnam, and many have plans to expand on this in
the future, not only in Vietnam, but across the wider Asia Pacific region. As such BMI expects to see
substantial growth in the value of the hotels and restaurants industry between 2013 and 2017.
Arrivals Outweigh Departures
Total Inbound & Outbound Travellers,
2010-2017 ('000)
TOTAL ARRIVALS: Total arrivals, '000
TOTAL DEPARTURES: Out-bound, total departures~ '000
2010
2011
2012
2013f
2014f
2015f
2016f
2017f
0
5,000
10,000
Source: General Statistics Office of Vietnam/BMI

Inbound Travel
Vietnam saw impressive growth in inbound travel in 2012 of an estimated 13.86%. Although we expect the
rate of growth to decline slightly, BMI expects growth to remain substantial at close to 6% per year for
inbound tourism. By 2017 we expect that the total number of annual arrivals will reach over 9mn.
Figures for arrivals from the Middle East, Africa and Latin America are currently unavailable, however
forecasts for the other regions are shown below.
Table: Vietnam Inbound Tourism, 2010-2017
2010 2011 2012e 2013f 2014f 2015f 2016f 2017f
Total Arrivals, '000 5,049.90 6,014.00 6,847.68 7,236.66 7,638.92 8,095.19 8,578.15 9,057.01
Total Arrivals, '000, % change y-
o-y 6.85 19.09 13.86 5.68 5.56 5.97 5.97 5.58
In-bound, arrivals by region,
North America, '000 533.20 546.30 557.39 576.14 577.77 582.22 588.27 596.42
North America, % change y-o-y 0.00 2.46 2.03 3.36 0.28 0.77 1.04 1.38
In-bound, arrivals by region, Asia
Pacific, '000 3,473.10 4,357.10 4,809.03 5,128.03 5,468.67 5,850.16 6,247.66 6,647.52
In-bound, arrivals by region, Asia
Pacific, % change y-o-y 0.00 25.45 10.37 6.63 6.64 6.98 6.79 6.40
Europe, '000 719.90 770.20 926.96 946.71 974.13 1,007.53 1,047.84 1,079.93
Europe, % change y-o-y 0.00 6.99 20.35 2.13 2.90 3.43 4.00 3.06
f = BMI forecast. Source: General Statistics Office of Vietnam, BMI Calculation

BMI expects that inbound arrivals from the Asia
Pacific region will continue to dominate the tourism
market in Vietnam. After minimal growth in 2010
we expect that arrivals from this region will grown
by around 6.5% a year leading to a total annual
arrivals figure of over 6.6mn by 2017. Arrivals from
North America will see much small grown of around
1% a year as the economy continues to struggle to
recover from the global credit crunch. Stronger
growth will be seen in arrivals from Europe of
around 3% a year between 2013 and 2017 and by
2017 we should see annual arrivals of just over 1mn
from this region.
The top 10 markets arrivals by country emphasises
the dominance of the Asia Pacific region in terms of
inbound travel to Vietnam. Arrivals from China
make up the majority of travellers, accounting for over 2.1mn travellers to Vietnam by 2017, up from 1.5mn
in 2013. Arrivals from South Korea will also show strong growth, rising from approximately 784,000 in
2013 to over 1.1mn by 2017. Japan, the third most popular country of origin for travellers to Vietnam, due
to a stagnant domestic economy, will see slower growth over the forecast period.
Outside of the Asia Pacific region Vietnam gets many visitors from the USA and France. By 2017 we
expect that the USA will drop down from its current fourth place to sixth, as arrivals from Taiwan and
Cambodia see particularly strong growth.
Table: Vietnam Inbound Tourism Top 10 markets by arrivals, 2010-2017 ('000)
2010 2011 2012e 2013f 2014f 2015f 2016f 2017f
China 905.40 1,416.80 1,428.69 1,549.34 1,672.59 1,812.98 1,966.11 2,140.72
South Korea 495.90 536.40 700.92 784.10 875.44 983.03 1,105.36 1,191.58
Japan 442.10 481.50 576.39 578.12 579.85 581.59 583.33 585.08
USA 431.00 439.90 443.83 464.04 467.62 472.30 476.70 482.66
Taiwan 334.00 361.10 409.39 417.61 437.77 460.94 485.74 514.29
Cambodia 254.60 423.40 331.94 383.27 430.65 473.83 507.74 546.32
On The Up
Total Arrivals by region, 2000-2017, ('000)
Total arrivals, '000 (RHS) (RHS)
In-bound, arrivals by region~ Europe~ '000 (LHS) (LHS)
In-bound, arrivals by region~ North America~ '000 (LHS) (LHS)
In-bound, arrivals by region~ Asia Pacific~ '000 (LHS) (LHS)
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013f
2014f
2015f
2016f
2017f
0
2,500
5,000
7,500
0
5,000
10,000
Source: General Statistics Office of Vietnam/BMI

Vietnam Inbound Tourism Top 10 markets by arrivals, 2010-2017 ('000) - Continued
2010 2011 2012e 2013f 2014f 2015f 2016f 2017f
Malaysia 211.30 233.10 299.04 297.00 313.91 332.75 347.14 363.92
Australia 278.20 289.80 289.84 307.87 309.66 311.45 313.24 315.04
Thailand 222.80 181.80 225.87 234.07 247.14 261.95 277.87 296.66
France 199.40 211.40 219.72 218.03 221.14 225.34 229.68 235.64
f = BMI forecast. Source: General Statistics Office of Vietnam, BMI Calculation
Outbound Travel
BMI has seen steady improvements in the domestic economy in Vietnam, with GDP growth of 5% in 2012
expected to rise to 7% in 2013 and continue at this rate through to 2017. By 2017 we therefore expect GDP
to reach US$271.12bn, up from US$161.59bn in 2013.
At the same time, we expect to see growth of 5.6% to 6.1% per year in terms of private financial
consumption, declining lending interest rates and a steady reduction year on year in unemployment rates.
These factors are resulting in the development of an affluent middle class able to spend more money on
outbound travel from Vietnam.
Table: Vietnam Outbound Tourism, 2010-2017
2010 2011 2012e 2013f 2014f 2015f 2016f 2017f
Total Out-bound, tourist
departures, '000 2,238.27 2,702.93 3,181.00 3,540.44 3,964.91 4,424.98 4,959.44 5,530.79
Out-bound, tourist departures, %
change y-o-y 26.27 20.76 17.69 11.30 11.99 11.60 12.08 11.52
Average Tourist Departure per
1000 of the population 0.03 0.03 0.04 0.04 0.04 0.05 0.05 0.06
Out-bound, resident departures
by destination, Africa, '000 0.06 5.58 0.08 0.10 0.11 0.12 0.14 0.15
by destination, Africa, % change
y-o-y -46.60
10,049.0
9 -98.58 22.78 11.34 12.04 11.57 10.37
by destination, North America,
'000 54.30 57.84 64.84 72.14 80.79 90.09 100.49 111.43
by destination, North America, %
change y-o-y 14.40 6.51 12.11 11.25 11.99 11.52 11.55 10.88
by destination, Latin America,
'000 1.29 1.70 2.15 2.36 2.67 3.04 3.37 3.76

Vietnam Outbound Tourism, 2010-2017 - Continued
2010 2011 2012e 2013f 2014f 2015f 2016f 2017f
by destination, Latin America, %
change y-o-y 24.47 32.40 26.23 9.72 13.05 13.79 11.00 11.48
by destination, Asia Pacific, '000 2,062.34 2,496.73 2,940.71 3,257.50 3,632.14 4,042.10 4,518.84 5,029.42
by destination, Asia Pacific, %
change y-o-y 27.55 21.06 17.78 10.77 11.50 11.29 11.79 11.30
by destination, Europe, '000 73.21 78.61 96.62 117.23 140.89 162.84 189.15 216.86
by destination, Europe, % change
y-o-y 5.92 7.37 22.92 21.33 20.18 15.58 16.15 14.65
by destination, Middle East, '000 47.07 62.47 76.59 91.12 108.31 126.79 147.46 169.18
by destination, Middle East, %
change y-o-y 23.84 32.70 22.61 18.97 18.87 17.06 16.30 14.73
f = BMI forecast. Source: National Sources, BMI Calculation
Most travellers from Vietnam visit countries in the
Asia Pacific region, in fact by 2017 we expect that
these travellers will account for 5mn out of 5.5mn
total outbound travellers. Europe is the second most
popular region for travellers from Vietnam, and we
expect that by 2017 there'll be approximately
216,000 visitors to Europe from Vietnam. North
America is the third most popular destination, and
we expect that tourists from Vietnam to North
America will increase by between 11% and 12% per
year.
In fact we expect that travel to all other regions will
increase throughout the forecast period, reflecting
the increasing spending power of Vietnamese
travellers. In particular we forecast high rates of
The Top Three
Outbound Tourism By Country, 2000-2017,
('000)
Outbound departures to Singapore, '000
Outbound departures to Malaysia, '000
Outbound departures to Thailand, '000
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011e
2012e
2013f
2014f
2015f
2016f
2017f
0
500
1,000
-500
1,500
Source: BMI

growth to the Middle East. Figures for travel to
Africa have recently become available, and while travel to Africa is currently minimal we expect figures to
grow steadily.
The top 10 markets by departures table below gives further insight into the nature of outbound travel from
Thailand, reflecting the dominance of countries from within the Asia Pacific region. In fact only two
countries from outside this region, the USA and Russia, make the top 10.
Cambodia is likely to remain the most popular destination for travellers from Vietnam, though Laos is likely
to remain close behind. Thailand and Singapore are also popular destinations, with Thailand in particular
benefiting from a variety of inexpensive and convenient travel links.
Russia forms a very popular destination, following a long history of close cooperation between the two
countries and substantial investment from Moscow in the Vietnamese tourism industry.
Table: Vietnam Outbound Tourism, Top 10 Markets by Departures, 2010-2017 ('000)
2010 2011 2012e 2013f 2014f 2015f 2016f 2017f
Cambodia 514.29 614.09 763.14 860.29 929.22 1,017.15 1,134.61 1,258.10
Thailand 380.37 496.77 617.80 665.68 735.70 805.36 886.03 965.38
Laos 431.01 561.59 615.68 656.68 747.82 841.18 960.60 1,103.87
Singapore 322.85 332.23 400.77 475.12 559.04 645.21 730.94 814.33
Malaysia 159.27 173.85 218.55 229.02 249.96 277.84 307.90 339.53
Russia 68.63 73.85 91.17 111.97 135.49 157.32 183.51 211.11
South Korea 71.12 84.55 86.66 102.07 110.08 117.86 125.86 140.70
Saudi Arabia 46.10 61.53 75.33 89.70 106.74 125.06 145.56 167.10
Hong Kong 80.11 68.12 71.58 70.87 70.09 69.38 68.77
USA 54.30 57.84 64.84 72.14 80.79 90.09 100.49 111.43
f = BMI forecast. Source: National Sources, BMI Calculation
Travel
Currently data is not available for transport and travel items receipts however we can see from the table
below that growth is expected both in terms of air and rail travel, reflecting the potential of the transport
industry in Vietnam. This growth is not only a result of the global economic recovery, but also arises from

the investment the Vietnamese government has put into infrastructure developments in recent years, with
over 14 airport expansion projects alone currently underway.
We expect that the number of air passengers will grow from 18.5mn in 2012 to 29.47mn in 2017, growth of
9-10% per year. At the same time we will see growth of around 9% per year in the number of domestic and
international take offs. We expect to see smaller growth in the number of railway passengers per year of
between 2.45% and 3.1% as travellers increasing turn to air travel in favour of long distance rail travel.
These increases demonstrate the strength of the tourism market in Vietnam and the long term potential for
investment.
Table: Vietnam Methods of Travel, 2010-2017
2010 2011 2012e 2013f 2014f 2015f 2016f 2017f
Air transport passengers carried,
mn, out-bound 14.10 16.27 18.50 20.18 22.16 24.31 26.81 29.47
Air transport passengers carried,
mn, out-bound, % change y-o-y 27.32 15.39 13.72 9.07 9.82 9.69 10.27 9.95
Air transport, registered airline
domestic and non-domestic
takeoffs, '000 103.46 116.65 130.21 140.41 152.45 165.50 180.67 196.88
Air transport, registered airline
domestic and non-domestic
takeoffs, '000, % change y-o-y 23.58 12.74 11.63 7.83 8.58 8.56 9.16 8.97
Domestic Railway passengers
carried, mn per km 4,378.00 4,932.43 5,092.58 5,250.68 5,405.37 5,555.53 5,700.60 5,840.31
Domestic Railway passengers
carried, mn per km % change y-o-y 6.03 12.66 3.25 3.10 2.95 2.78 2.61 2.45
f = BMI forecast. Source: World Bank, UN, BMI Calculation
Hotels
Currently only limited data on the number of hotels is available for Vietnam. Based on industry evaluations
we expect to see growth in the number of hotels present in the country throughout the forecast period, with
growth of over 6% per year leading to the total number of establishments reaching over 10,000 by 2017.

Table: Vietnam Hotel Accommodation 2010-2017
2010 2011 2012e 2013f 2014f 2015f 2016f 2017f
Number of Hotels and
establishments '000 6.09 6.78 7.47 7.96 8.48 9.06 9.67 10.28
- % change y-o-y 5.53 11.35 10.12 6.63 6.44 6.86 6.80 6.31
Source: BMI
The strength of the tourism market in Vietnam is further reflected by the growth forecast in terms of the
domestic hotels and restaurants industry value shown below.
Table: Vietnam Domestic Hotels and Restaurants Industry Value, 2010-2017
2010 2011 2012e 2013f 2014f 2015f 2016f 2017f
Domestic Hotels and
Restaurants Industry Value
VNDbn 80,788.00
105,475.6
8
117,592.2
1
132,819.6
0
149,282.6
0
166,974.8
0
186,419.5
9
208,262.7
4
Domestic Hotels and
Restaurants Industry Value
VNDbn, % change y-o-y 19.87 30.56 11.49 12.95 12.40 11.85 11.65 11.72
Domestic Hotels and
Restaurants Industry Value, US
$bn 4.23 5.11 5.63 6.36 7.26 8.21 9.27 10.41
Domestic Hotels and
$bn, % change y-o-y 11.59 20.85 10.33 12.80 14.23 13.14 12.92 12.28
Domestic Hotels and
Restaurants Industry Value,
EURbn 3.19 3.67 4.44 4.74 5.72 6.68 7.73 8.68
Domestic Hotels and
Restaurants Industry Value,
EURbn, % change y-o-y 17.78 15.33 20.76 6.91 20.52 16.82 15.75 12.28
Domestic Hotels and
Restaurants Industry Value, %
of GDP 4.08 4.16 3.99 3.95 3.91 3.88 3.86 3.84
Domestic Hotels and
$ per capita 48.09 57.51 62.78 70.10 79.28 88.85 99.41 110.65
Domestic Hotels and
$ per capita, % change y-o-y 10.39 19.57 9.18 11.65 13.10 12.07 11.89 11.30
Domestic Hotels and
Restaurants Industry Value per
employee, US$ 5,194.90 6,035.74 6,411.70 6,973.35 7,689.68 8,409.40 9,188.74 9,993.24
Domestic Hotels and
Restaurants Industry Value per 7.11 16.19 6.23 8.76 10.27 9.36 9.27 8.76

Vietnam Domestic Hotels and Restaurants Industry Value, 2010-2017 - Continued
2010 2011 2012e 2013f 2014f 2015f 2016f 2017f
employee, US$, % change y-o-
y
f = BMI forecast. Source: UN, ILO
Between 2013 and 2017 we expect the value of the industry to grow from US$6.36bn to US$10.41bn, at a
rate of approximately 13% per year. At the same time, due to the increasing strength of the domestic
economy we expect that the value of the industry will decline as a percentage of the country's overall GDP.
This is however a reflection of wider growth in the economy as opposed to a decline in the tourism market
as demonstrated by the market's increasing value per capita and per employee.
Overall therefore the future is looking very promising for the tourism market in Vietnam. The strong
domestic economic conditions will drive up outbound tourism and see improvements in the country's
transport infrastructure which will provide a further long term boost to inbound travel. We therefore expect
to see growth across all market indicators including the overall hotel and restaurant industry values making
Vietnam an attractive prospect for investment.

Economic Analysis
Economic Outlook
BMI View: The State Bank of Vietnam's surprise decision to cut its policy rate by 100 basis points from
10.00% to 9.00% suggests that policymakers are under increasing pressure to stimulate economic growth
in 2013. We believe that the latest move will help reinforce government efforts to boost private sector
investment. Given that money supply growth remains considerably low by historical standards, we believe
that the risks of reigniting inflationary pressure remain manageable.
The State Bank of Vietnam (SBV) cut its policy rate (refinancing rate) by 100 basis points from 10.00% to
9.00% on December 24 2012, just days before the General Statistics Office published its preliminary
estimate for GDP growth to come in slightly weaker than expected at 5.0% for 2012 (compared
with Bloomberg consensus of 5.2%). The surprise rate cut came amid growing concerns that mounting bad
debt across the banking sector is deterring banks from issuing new loans to businesses, and that this could
severely undermine government efforts to reignite economic growth in 2013. From our perspective, the
move also suggests that policymakers are under increasing pressure to adopt more aggressive measures to
stimulate economic growth in an attempt to stem the growing number of bankruptcies among small-and-
medium enterprises (SMEs) and rising unemployment. This is closely in line with our view that the
Vietnamese government's economic agenda will remain skewed towards boosting growth in 2013.

Recovery On Track
Vietnam - Real GDP, VNDbn (LHS) & % chg y-o-y (RHS)
Source: BMI, General Statistics Office
We are seeing evidence that credit conditions are beginning to improve and expect demand for private
sector credit to pick up gradually in H113. In addition to aggressive monetary policy easing by the SBV, the
government has also announced plans to slash corporate income tax rates by two percentage points to 23%
in 2013. We believe that lower lending rates and tax incentives will help to reinforce government efforts to
attract foreign direct investment and boost private sector investment over the coming quarters.
Inflation Still A Manageable Risk
International organisations including the World Bank and IMF have warned against easing monetary policy
too aggressively, which risks reigniting inflationary pressure. Although we acknowledge these risks, we
highlight that the recent rebound in money supply growth remains considerably weak by historical
standards. As the accompanying chart shows, prior to periods in which Vietnam experienced very high
inflation (2008 and 2011), M2 money supply was expanding at a rate of 33.3% and 46.1% in 2007 and
2010, respectively. This compares with M2 growth that came in at a record low of just 6.0% in 2012 and

our forecast for a mild pickup towards 11.0% for 2013, suggesting that inflation is likely to remain
manageable at under 7.0% in 2013.
Credit Conditions To Improve In 2013
Vietnam - M2 Money Supply, VNDbn (LHS) & % chg y-o-y (RHS)
f = BMI forecast. Source: BMI, State Bank of Vietnam
We acknowledge that the risk of a potential surge in commodity prices in 2013 - especially food prices,
which make up around 40% of the consumer price index basket - could turn out to be a wildcard for
policymakers. For now, we believe that overall conditions in Vietnam remain in favour of our forecast for
real GDP growth to come in relatively strong at 7.0% in 2013.
Expenditure Breakdown
Private Consumption: We expect private consumption to grow at a robust pace of 5.6% in 2013. However,
we note that the risk of a sustained collapse in exports and further bankruptcies among SMEs could
potentially lead to widespread job losses in export-driven sectors. Uncertainties over the outlook for
employment could, in turn, prompt households to cut back on spending.

Gross Fixed Capital Formation: We foresee a significant pickup in private sector investment growth in
2013. We believe lending rates will gradually ease over the coming months as the effect of recent rate cuts
by the SBV begins to kick in. We are also seeing evidence that credit conditions are improving.
Accordingly, we expect gross fixed capital formation growth to accelerate from 4.3% in 2012 to 5.9% in
2013.
Public Spending: We expect total public spending to remain relatively resilient in 2013, expanding at a
respectable pace of 5.4%. However, there is limited room for the government to increase spending further
owing to concerns over the need to finance a potential bailout of ailing state-owned commercial banks.
Net Exports: Net exports remain the biggest downside risk to our outlook for the Vietnamese economy,
although we expect external demand to pick up as we head into H113. Vietnam has been recording an
average monthly trade surplus of US$172mn since June 2012 (resulting in a year-to-date surplus of US
$77mn) and we see the case for a substantial pickup in external demand on the back of a rebound in
regional growth over the coming month. However, we believe that China's structural imbalances will return
in H213, becoming a drag on regional growth. Accordingly, we still expect exports to expand at a moderate
pace of 6.5% in 2013.
Table: Vietnam - Economic Activity
2009 2010 2011e 2012e 2013f 2014f 2015f 2016f 2017f
Nominal GDP,
VNDbn 2 1,658,389 1,980,914 2,536,631 2,950,684 3,361,036 3,813,158 4,301,043 4,832,660 5,422,488
Nominal GDP,
US$bn 2 93.16 103.53 122.82 141.44 161.59 185.42 211.56 240.43 271.12
Real GDP
growth, %
change y-o-y 2 5.3 6.8 6.0 5.0 7.0 7.2 7.2 7.0 6.9
GDP per capita,
US$ 2 1,072 1,178 1,383 1,576 1,782 2,025 2,289 2,577 2,881
Population, mn
3 86.9 87.8 88.8 89.7 90.7 91.6 92.4 93.3 94.1
Industrial
production
index, % y-o-y,
ave 1,4 6.7 14.1 10.9 7.0 12.0 14.0 13.0 12.0 11.0
Unemployment,
% of labour
force, eop 4 6.0 4.3 4.5 6.0 4.8 4.7 4.6 4.5 4.4
Notes: e BMI estimates. f BMI forecasts. 1 at 1994 prices. Sources: 2 Asian Development Bank, General Statistics Office; 3
World Bank/UN/BMI; 4 General Statistics Office.

Industry Risk Reward Ratings
Tourism Risk Rewards Ratings
Table: Asia, Risk and Reward Ratings
Rewards Risks
Limits of
potential
returns
Tourism
Market
Country
Structure
Risks to
realisation of
potential returns Market risks
Country
Risk
Tourism
Rating Rank
Hong Kong 75.32 83.33 63.29 77.82 80.22 75.86 76.07 1
Thailand 75.99 85.30 62.04 60.64 68.09 54.54 71.39 2
Singapore 65.29 71.67 55.73 80.55 85.47 76.52 69.87 3
Australia 63.83 58.33 72.06 82.42 78.40 85.72 69.40 4
Macau 70.00 78.33 57.50 67.20 65.00 69.00 69.16 5
Taiwan 68.62 75.00 59.04 64.09 73.21 56.63 67.26 6
South Korea 63.93 60.00 69.83 66.58 70.39 63.46 64.73 7
New Zealand 49.88 26.67 84.69 83.25 76.65 88.66 59.89 8
Vietnam 60.91 60.00 62.26 55.57 65.19 47.70 59.30 9
Malaysia 54.33 50.00 60.83 67.13 74.52 61.09 58.17 10
Sri Lanka 57.66 60.00 54.14 50.31 63.77 39.29 55.45 11
Japan 46.12 25.83 76.55 67.96 67.99 67.93 52.67 12
Laos 56.48 61.67 48.70 41.76 63.88 23.66 52.06 13
China 48.02 43.33 55.05 58.97 77.14 44.10 51.30 14
Cambodia 56.89 66.67 42.21 36.25 33.02 38.90 50.69 15
India 42.22 40.00 45.54 46.72 35.61 55.82 43.57 16
Indonesia 36.47 32.50 42.41 51.13 63.64 40.89 40.86 17
Source: BMI
Limits Of Potential Returns
This is an evaluation of the sector's size and growth potential in each state, along with broader industry/
state characteristics that may inhibit its development. The reward ratings for tourism take into account the
numbers and % growth of tourist arrivals over the past year and our forecasts for future growth over 2013.
Vietnam has seen large increases in inbound travel in recent years and figures are expected to continue to
rise. Although the fragile international economy means arrival figures may be depressed this should be

compensated for by growth from countries in the Asia Pacific region. The overall figures for tourism
receipts and hotel occupancy were similarly enhanced and offset, and factored in accordingly, giving
Vietnam a Tourism Market figure of 60.
The Country Structure score takes into account labour costs and infrastructure. Vietnam has a relatively
well developed infrastructure however it is in need of substantial investment for expansion and
improvement projects across several areas including rail and air travel. As such Vietnam has a score of
62.26, relatively high in comparison to other countries in the region.
Risks To Realisation Of Returns
This section offers an evaluation of industry-specific dangers and those emanating from the state's political
and economic profile that call into question the likelihood of anticipated returns being realised over the
assessed time period. The market risks score takes into account short term political stability and regional
stability - which is relatively strong in Vietnam. However, it also considers Vietnam's vulnerability to
external factors - in particular continuing tensions with China. As such Vietnam scores 55 which accounts
for the possibility for regional and domestic tensions impacting on tourism figures.
Finally, BMI's proprietary country risk scores cover corruption, legal framework, bureaucracy, market
openness and security risks. Vietnam repeatedly suffers from allegations of corruption at high levels of
government and business which can deter international investment and as such it has a mid-range score of
47.7.
Overall Vietnam is ranked ninth out of 17 countries in the Asia Pacific region with a Tourism Market figure
of 59.3.

Security Risk Reward Ratings
BMI's Security Ratings service, which integrates closely with our Country Risk service, offers a
comprehensive comparative analysis of security risk in three key areas - interstate conflict, terrorism and
physical safety for expatriate workers - across major states in each region. The ratings are combined to form
a composite security rating to provide an overall guide to long-term trends and risks. We integrate our short-
term political and economic ratings with the terrorism rating, to indicate a state's vulnerability to a sustained
terrorist campaign or major terrorist attack. In all instances, the rated period is two years, with each country
assigned a score out of 100, with a low score indicating a high level of risk.
Table: Asia Pacific Regional Security Ratings
State Interstate Terrorism Criminal
Composite
domestic risk
Regional
rank
Composite
security risk
Ranking
Singapore 91 87 99 93 1= 92 1
Australia 98 83 92 88 4 91 2=
Japan 90 92 91 91 3 91 2=
Taiwan 71 95 79 87 6= 82 4
South Korea 68 86 88 87 5 81 5
Malaysia 81 84 69 77 8 78 6=
North Korea 48 98 88 93 1= 78 6=
Vietnam 60 98 71 85 6= 76 8
China 80 85 59 72 9 74 9=
Thailand 84 66 71 68 10 74 9=
Indonesia 88 68 52 60 11 69 11
Philippines 84 49 40 45 13 58 12
India 68 47 53 50 12 56 13
Pakistan 46 26 37 31 14 36 14
Source: BMI
Overall, expatriates living in Vietnam are not at high risk from physical safety threats, such as physical
violence or kidnapping. The local community is at risk from petty crime, as well as the threat of bird
flu. There is little or no terrorism risk in Vietnam. Thus, it receives a terrorist risk rating of 98.
Vietnam's bid to normalise its defence and diplomatic relations has led to some cooperation on defence
issues and the country taking on a more prominent role in the international community, such as its recent

non-permanent membership of the UN Security Council. By taking on such a role, Vietnam will no doubt
be forging stronger ties with many states. However, it will also have to balance its new position against the
expectations of more established allies.
The country is ranked eighth in the region, reflecting its relative vulnerability to terrorism, which could
have an impact on inbound tourism in the event of a large-scale event.

Market Overview
BMI sees a very positive future for the tourism
industry in Vietnam. Strong growth in the country's
GDP, which we expect to increase by over 7% a year
between 2013 and 2017, will contribute to an
increase in both internal and outbound travel,
providing a solid boost to the overall industry value.
Economic improvements in the wider Asia-Pacific
region will also result in a substantial increase in
inbound travel.
Foreign direct investment is increasing, and Vietnam
has a particularly strong relationship with Russia
who has invested heavily in the country's tourism
industry. However there are lingering concerns
surrounding corruption in the country and potential
investors will need to consider these issues.
Vietnam currently has eigth international airports,
with a further 15 domestic (non-military) airports
providing extensive connectivity around the country.
However with inbound and domestic travel increasing the country will need to make substantial expansions
and improvements to its transport infrastructure. Developing the tourism industry is a priority for the
government, and as such plans are being developed to build new airports at Dong Nai, Lang Son, Phuker
Quoc and Quang Ninh. New terminal buildings and runways are also being developed at several of the pre
existing main airports. These expansions have helped the country to expand its flight routes, with Dragon
Airlines offering new flights to Da Nang from Hong Kong from early 2013 and Korean Air, Asiana
Airlines and Silk Air all increasing their flights to this region.
Plans are also underway to develop the country's rail network, with the government investing US$9.5bn in
the next three years in the improvement and expansion of the rail network. Projects are however frequently
delayed by a lack of available funds, however with the improving domestic economy we should see more
progress in the infrastructure improvements. This is part of the wider construction sector, which BMI
expects will expand by around 5.3% in 2013.
Steady Industry Growth
Construction, Transport and Tourism Industry
Values, 2010-2017
TRANSPORT: Transport infrastructure industry value, US$bn (RHS)
INDUSTRY VALUE: Hotels and restaurants industry value, US$bn (LHS)
CONSTRUCTION: Construction industry value, US$bn (LHS)2010
2011
2012
2013f
2014f
2015f
2016f
2017f
0
10
20
1.5
2
2.5
3
3.5
Notes: 1 "Local news sources, industry sources, BMI
Research (Major Projects Database)" 2 "UN/BMI Forecast"
3 "Vietnam General Statistics Office"

A breakdown of the country's 14 airport infrastructure projects can be found below.
Table: Vietnam Major Infrastructure Projects
Project Name Sector
Value (US
$mn)
Capacity/
Length Timeframe Status
Quang Tri Airport - Gio
Linh District Airport Airports 27 na 2009-2015
Planning stage - Approved in February
2009
Noi Bai International
Airport extension (includes
T2 terminal) Airports 960
10mn
passenger
s /year
September
2012 -
November
2014
Contract awarded (September 2012); US
$759mn ODA loan from Japan
Phu Quoc International
airport, Duong To
Commune Airports 780
3mn
passenger
s/yr
2009 -
December
2012
Under Construction, Construction on
terminal started in end-Jan 2012 (October
2012)
Chu Lai International
Airport Airports 1000
4mn
passenger
s /year -2025 MoU for feasibility study approved
Long Thanh international
airport (Passenger
terminal, runway, parking
place), Dong Nai province Airports 6700
100mn
passenger
s /year 2015-2020
At planning stage, finalising investment
plan (August 2012)
Phu Bai International
Airport upgrade, Thu
Thien-Hue Province Airports 595
5mn
passenger
s/year 2011 - 2020
At planning stage, government to arrange
financing for 2012 (Nov 2011)
Tien Lang International
Airport, Hai Phong Airports na
80mn
passenger
s /year 2010- At planning stage
Pleiku Airport (two-phase
upgrade), Gia Lai Airports 105
500000
passenger
s /year
2011-2030
(first phase) At planning stage
Cat Bi international airport
(first phase) upgrading
project, Haiphong,
Northern Vietnam Airports 240
2mn
passenger
s/yr
February
2013 - 2015
(first phase);
- 2025
At planning stage, seeking financing
(November 2012)
Quang Ninh International
airport, Doan Ket
commune, Van Don
region, Quang Ninh
province Airports 250
2-5mn
passenger
s/yr 2013 - 2015
Preparation to be finalised by 2012, Project
site moved to Doan Ket commune (Jan
2012)
Vung Tau airport
expansion Airports na na 2011 -
At planning stage, received approval for
new project site (September 2011)
Van Don International
airport, 45km from Ha
Long Bay, Quang Ninh
province Airports 1200 na
October
2012 -
At planning stage, South Korean
companies expressed interest (October
2012)
Lao Cai international
airport Airports 62.6 na
January
2012 - 2020
At planning stage, project announced
(January 2012)
Source: BMI Key Projects Database

The tourism industry in Vietnam is founded on a wide range of attractions, varying from rural eco and
wildlife parks to vibrant metropolitan cities like Ho Chi Minch City. A range of UNESCO World Heritage
sites including Ha Long Bay, Hoi An Ancient Town and the Citadel of the Ho Dynasty and historical
tourism attractions are also very popular. On top of these attractions Vietnam also offers pristine white
sandy beaches for traditional vacationers.
The attraction of the country has been recognised by the world's top ten global hotel chains, many of whom
have a presence in the country, in particular Accor, Best Western International, Hilton, Hyatt,
Starwood, Marriott and Intercontinental Hotels Group (IHG). Accor is one of the largest, with 15 hotels
at a range of locations across the country including the capital city and several luxury beach resorts. The
other chains have between 2 and 5 hotels in the country, with many having plans for new developments in
the near future including Starwood's new Le Meridian resort due to open in 2014.
Table: Top 10 Global Hotel Groups Present in Vietnam
Global Hotel Group Presence in Vietnam Hotel Brands present in Vietnam
Accor Hotels
Accor group has 15 hotels in Vietnam, at a
range of locations including business hotels
in the capital city and large scale luxury
beach resorts.
Sofitel, Pullman, La Residence,
McGallery, Novotel, Mercure, Ibis,
Lifestyle
Carlson Rezidor Hotel Group No Presence No Presence
Choice Hotels International No Presence No Presence
Best Western
Best Western group has 5 hotels in 4
locations in Vietnam including a premier
resort.
Best Western, Best Western
Premier,
Hilton
Hilton currently has two hotels in Vietnam,
both in Hanoi one catering for business
travellers and another aimed more at
tourists in the French Quarter with spa
facilities. Hilton
Hyatt
Hyatt has two hotels, one in Ho Chi Minh
and a large resort and spa in Danang Park Hyatt, Hyatt Regency
Intercontinental Hotels Group
ICG has two resorts in Danang, four hotels
in Hanoi and a further two hotels in Ho Chi
Minh City. Crowne Plaza, Intercontinental
Marriott
Marriott has two hotels in Vietnam, one in
Ho Chi Minh City and a newly opened JW
Marriott hotel in Hanoi. JW Marriott, Renaissance
Starwood
Starwood currently has three Sheraton
hotels in Veitnam. The group plans to open
an expansive Le Meridien resort in early
2014 Sheraton, Le Meridien
Wyndham No Presence No Presence
Source: BMI

Overall the future is looking very positive for the
tourism industry in Vietnam, if the country can
overcome continuing concerns over corruption and
domestic security concerns. Domestic political
stability and continuing regional economic
development are vital for the long term health of the
market, as it is dependent on major markets within
the Asia Pacific region. Continued investment in
improvement of the country's transport infrastructure
and widespread marketing campaigns should see the
country well placed to take advantage of the
forecasted increases in inbound and outbound travel,
meaning the growth in tourism should continue to
rise.
Upwards Trend
Hotel and Restaurants Industry Value (US$bn)
(LHS), Total Arrivals ('000), (RHS), 2000-2017
Total arrivals, '000 (RHS) (RHS)
Hotels and restaurants industry value, US$bn (LHS) (LHS)
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013f
2014f
2015f
2016f
2017f
0
5
10
15
0
5,000
10,000
Source: General Statistics Office of Vietnam/BMI/UN

Company Profile
Huong Giang Tourist Company
Company Overview Huong Giang Tourist Company was established in 1976 in Hue. It concentrates on the
hotel industry, restaurants and other travel services, focusing on high end luxury travel.
The group has expanded considerably since 1976 with a nationwide network of offices
and support facilities.
The company is part of the Pacific Asia Travel Association, the Japanese Association of
Travel Agents and the American Society of Travel Agents. The Vietnamese industry's
concentration on attracting tourists from the US and the start of direct flights between
the countries bodes well for future occupancy rates. The firm has interests in:
■ The four-star Lang Co Beach Resort, between Hue and Da Nang.
■ The four-star Huong Giang Hotel in Hue.
■ Majority shareholder (51%) in the four-star Saigon Morin Hotel in Hue.
■ The leading five-star international hotel in Hue.
It has a presence in all the major Vietnamese cities, including Hanoi, Ho Chi Minh City,
Da Nang and Hue. The company is involved in joint ventures, affiliated investments and
cooperation with domestic and international partners. It has expanded rapidly
throughout Asia and has offices in Laos, Cambodia and Myanmar, as well as in
Europe. As part of its expansion strategy, the group has linked up with companies such
as Turkish Airlines, Hai Long Junks and Bhaya Cruises to offer more travel options.
Company Details ■ Huong Giang Tourist Company
■ 17 Le Loi Street
Hue
Vietnam
■ Tel: +84 (8) 832 221
■ Chairman: Ngo Minh Duc
■ CEO: Tran Thanh Nam

Saigontourist
Company Overview Saigontourist Travel Service Company was originally established by the state in 1975,
and is now part of the Saigontourist Holding Company which was incorporated in
1999 at the behest of the Ho Chi Minh City People's Committee. The group's activities
include accommodation, food and beverages, recreation, travel and food processing -
but its primary focus is hotels.
The group owns more than 70 hotels ranging from three to five stars at a range of
locations across the country. The company has more than 10% of the Vietnam's rated
hotels. It operates eight travel service companies, 13 resorts and 28 restaurants,
underlining its status as a 'state favourite' in investment terms. Saigontourist Travel
Service Company is the biggest tour operator in Vietnam, offering both domestic and
international tours.
The company is an official member of a number of foreign travel agent associations,
including the American Society of Travel Agents. Saigontourist said it will continue
cultivating its links in international markets including Japan, China, Taiwan, Singapore
and South Korea. The company is also working with several cruise companies such as
Costa and SuperStar, to take advantage of Vietnam's inclusion in cruise routes.
Moving forward the group is expanding its tour services, having recently opened the
country's biggest travel information centre in HCMC offering a range of tourist services
across several languages. The company continues to perform well, with tourism
revenue in 2012 reaching VND 2.08 trillion, up 26% on 2011 figures. Overall the group
provided services for over 450,000 domestic and international tourists in 2012 reflecting
the breadth of the company's market coverage.
Company Details ■ Saigontourist
■ 23 Le Loi, District 1
Ho Chi Minh City
Vietnam
■ Tel: +84 (8) 8292 291
■ Director general: Tran Hung Viet

Global Industry Overview
BMI View: Global tourist receipt levels are set to grow in 2013 to an estimated US$1.27trn, this will be the
fourth consecutive year of growth since 2009. Growth will be attributed to an expected rise in the number of
tourist arrivals in 2013, along with healthier levels of global disposable income which will feed through
into higher levels of tourist spending. From 2013 to 2017, total receipts will grow between 5-8.5% per year,
totalling around US$1.78trn by the end of 2017.
International tourism receipts levels are set to rise by
5.97% in 2013 taking the total amount spent by
tourists globally to US$1.27trn. This success can
largely be attributed by two effects: firstly,
international tourism levels are set to rise in 2013 by
4.2%, bringing total arrivals estimated to just over
1bn across the BMI tourism universe. A higher flow
of international tourists traditionally generates higher
levels of international tourist spending and this
should have a positive effect on receipts levels of
major tourist destinations. Secondly with the global
economic recovery set to continue, disposable
income levels will improve throughout
2013, allowing tourists to spend more abroad.
Receipts per tourist in 2012 came in at US$1196.00,
this will rise by 5.8% for 2013 to around US
$1265.00 and will continue to grow at over 5%
through till 2017.
Every Region Set To Benefit
Regionally, the Middle East will benefit the most. Total receipts are estimated to be US$46.1bn for 2013, a
12.3% rise from 2012. The dominant theme will be a rise in tourist arrivals within the region encouraged by
the calmer political landscape, the region will see an extra 4.67mn visitors for this year taking total arrivals
to 58mn. However, the Asian- Pacific region will also see an increase in total receipts of 7.2% to US
$326.8mn for the year, while Africa will see growth of 8.7% and Latin America of 5.3%.
On The Rise
International Tourist Arrivals ('000) and
Tourism Receipts (US$bn), 2000-2017
WORLD: Total arrivals, '000 (LHS) (LHS)
WORLD: International tourism, receipts~ US$bn (RHS) (RHS)
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012e
2013f
2014f
2015f
2016f
2017f
0
500,000
1,000,000
1,500,000
500
1,000
1,500
2,000
0
Source: National Sources/ World Bank/BMI

After posting a 3.8% growth in total receipts for 2012, levels in developed states are estimated to be at US
$727.1bn for 2013, an increase of 4.7%. In terms of global receipt levels, developed states make up 57.5%
of total world tourism receipts. Going forward, we forecast that this region will benefit from the global
economic recovery. Arrivals are set to rise by between 2% and 4% per year from 2013 to 2017, which will
mostly be comprised of inter-regional European travel. From 2014 onwards, the growth in receipts is likely
to be around 7% per year, taking overall receipt value in 2017 to just under the US$1trn.
From 2013 to 2017, international tourist arrivals are to increase on average between 4-5.5% per year, with
1.2bn arrivals expected in 2017 across the BMI tourism universe. This is likely to be confirmed with tourist
receipts levels set to grow between 5-8.5% per year, which will total to US$1.78trn at the end of 2017.
Table: Total Receipts By Country, 2012-2013, (US$bn)
Rank Country
2012
(US$bn) Rank Country
2013
(US$bn)
1 US 200.01 1 US 210.17
2 Spain 66.13 2 Spain 68.60
3 France 62.32 3 France 65.28
4 China 55.29 4 China 60.47
5 Germany 53.88 5 Germany 56.01
6 Italy 43.50 6 UK 44.37
7 UK 42.95 7 Italy 44.08
8 Hong Kong 35.57 8 Hong Kong 38.79
9 Macau 34.54 9 Australia 36.98
10 Australia 34.49 10 Macau 36.97
11 Thailand 33.65 11 Thailand 35.42
12 Turkey 28.01 12 Turkey 29.25
13 Austria 22.94 13 Austria 23.92
14 Malaysia 20.52 14 Malaysia 22.03
15 Netherlands 20.46 15 Netherlands 21.39
16 Canada 19.76 16 Canada 20.98
17 Switzerland 18.81 17 Switzerland 20.51
18 Singapore 18.21 18 Singapore 19.85
19 South Korea 18.07 19 Russia 19.75

Total Receipts By Country, 2012-2013, (US$bn) - Continued
Rank Country
2012
(US$bn) Rank Country
2013
(US$bn)
20 Russia 17.71 20 India 18.89
Source: National Sources, World Bank, BMI, BMI Forecasts
US Remains Top Earner
On an individual country-by-country basis, the US remains the top earner with regards to the tourism
industry, and we forecast this will bring in around US$210bn for the country in 2013, an increase of 5.1%
y-o-y from 2012. The next biggest earners are Spain, France, and Germany, whose tourism receipts will
each see increases of over 3%. China, which overtook Germany in 2010 to become the fourth biggest
tourism earner, is forecast to see tourism receipts worth US$60bn in 2013. Larger investment into tourist
infrastructure and facilities within the country has made China a more attractive tourist destination for both
Western and Eastern tourists. Chinese tourist arrivals for 2013 will grow by over 2mn to 29.8mn in 2013,
showing y-o-y growth of 8.6%.
Other notable movers are Australia, Russia and India. Australia will move into ninth place, overtaking
Macau and we forecast receipts will grow by 7.2% in 2013. Russia and India will be in 19th and 20th places
respectively. We forecast that Russia's tourism receipts will grow by over 10% in 2013, reaching US
$19.75bn, this will be buoyed-up by higher arrivals of over 30mn. India will earn US$18.9bn from
international tourism in 2013. This is in part due to the country's ongoing infrastructure developments,
boosting its attractiveness as a tourist destination. Both Russia and India are likely to climb up the list over
the next five years. Major tourism marketing and global sporting events will see Russia move to thirteenth
in 2017 with receipts of US$32bn. India in 2017, will move to eighteenth with US$28bn.
International Transport And Travel Receipts Follow Suit
Similar increases in receipts levels for transport services for the forecast period 2013-2017 confirm the view
of larger movements in tourist passengers. We forecast that overall global growth for this period will grow
between 3% and 5% per annum until 2017, amounting to US$174.2bn in 2013 and US$216.9bn in 2017.
Transport services will continue to make up around 15% of global total receipt levels.

Table: Global Sporting Calendar, 2013-2022
Year Country City/Cities Event Sport
2013 Russia Moscow
IAAF World Championship
Athletics Mixed
2013 South Africa
Rustenburg, Johannesburg,
Nelspruit, Durban, Port Elizabeth, Africa Cup of Nations Football
2013 Brazil
Unconfirmed but short list is:
Fortaleza, Recife, Salvador,
Brasilia, Belo Horizonte, Rio de
Janeiro FIFA Confederations Cup Football
2013 Myanmar Naypidaw Asia Games Mixed
2013 Sweden Malmo Eurovision Song Contest Singing
2013 Czech republic Prague UEFA Super Cup Football
2013 England London
UEFA Champions League
Final Football
2014 Bangladesh
Dhaka, Chittagong, Narayaganj,
Rajshahi, Sylhet, Khulna, 2020 World Cup Cricket
2014 Brazil
Manaus, Fortaleza, Natal, Recife,
Salvador, Brasilia, Cuiba, Belo
Horizonte, Sao Paolo, Rio de
Janeiro, Curitiba, Porto Alegre FIFA World Cup Football
2014 Not Confirmed Pan Arab Games Mixed
2014 Wales Cardiff UEFA Super Cup Football
2014 Scotland Auchterarder, Gleneagles Ryder Cup Golf
2014 Russia Sochi, Krasnaya Polyana Winter Olympics Mixed
2014 Scotland Glasgow Commonwealth Games Mixed
2014 China Nanjing Youth games (Summer) Mixed
2014 South Korea Incheon Asian Games Mixed
2014 Portugal Lisbon
UEFA Champions League
Final
2015
Australia and New
Zealand Not Decided Cricket World Cup Cricket
2015 England
Cardiff, London, Birmingham,
Brighton, Bristol, Conventry, Dervy,
Gloucester, Leeds, Leicester,
Manchester, Milton Keynes, New
Castle, Southhampton, Sunderland Rugby World Cup Rugby
2015 Canada
Vancouver, Edmonton, Winnipeg,
Ottawa, Montreal, and Moncton FIFA Women's World Cup Football
2015 Canada Toronto Pan American Games Mixed
2015 Morocco
Casablanca, Rabat, Fes,
Marrakesh, Tangier, Agadir Africa Cup of Nations Football
2015 Georgia Tibilisi UEFA Super Cup Football
2015 Singapore Not Decided Asian Games Mixed

Global Sporting Calendar, 2013-2022 - Continued
Year Country City/Cities Event Sport
2015 Australia
Melbourne, Sydney Brisbane
Canberra Asia Cup Football
2016 Host not confirmed OFC Nations Cup Football
2016 France
Lens, Lille, Paris, Bourdeaux, Lyon,
Marseille, Nice, Toulouse, St-
Etienne UEFA Euro Football
2016 Brazil Rio de Janeiro Olympics Mixed
2016 India Not Decided 2020 World Cup Cricket
2016 USA Chaska Ryder Cup Golf
2016 Norway Lillehammer Youth Games (Winter) Mixed
2017 Libya Not Decided Africa Cup of Nations Football
2017 England London
IAAF World Championship
Athletics Mixed
2017 Russia
Moscow, Kazhan, Sochi, St
Petersburg FIFA Confederations Cup Football
2018 Russia
Kaliningrad, Kazan, Krasnodar,
Moscow, Nizhny Novgorod,
Rostov-on-Don, Saint Petersburg,
Samara, Saransk, Sochi,
Volgograd, Yaroslavl,
Yekaterinburg FIFA World Cup Football
2018 South Korea Pyeongchang Winter Olympics Mixed
2018 Australia Gold Coast City Commonwealth Games Mixed
2018 France Paris Ryder Cup Golf
2019 England & Wales Not Decided Cricket World Cup Cricket
2019 Japan
Tokyo, Sapporo, Yokohama,
Osaka, Toyota, Kobe, Fukuoka,
Sendai Rugby World Cup Rugby
2020 USA Sheboygan Ryder Cup Golf
2020 Host not confirmed OFC Nations Cup Football
2021 Qatar Not Decided FIFA Confederations Cup Football
2022 Qatar
Al-Khor, Doha, Ash-Shamal, Al
Wakrah, Umm Salar, Al Rayyan FIFA World Cup Football
Source: BMI

Global Assumptions
Our global real GDP growth estimates are unchanged since our last Global Assumptions update, at 2.9% for
2013 and 3.4% for 2014. In line with our view, global economic activity has picked up modestly in the past
few months, following near-recessionary conditions in parts of 2012. Growth momentum in the US and
China, especially, have impressed in the first two months of 2013, and suggest that a global recovery is still
on. The eurozone remains a lingering concern, although we believe that the crisis has migrated from an
acute to a more chronic phase that suggests tail risks of disintegration have reduced and output will begin to
stabilise towards the end of the year.
We continue to foresee a renewed slowdown in Chinese economic activity in the second half of the year,
but for now, the global economy appears to be on more solid ground. For the time being, loose monetary
policy and the removal of some major tail risks mean that the risks to global growth are more tilted to the
upside than they were in 2012. Our headline global industrial production index increased by a modest 0.3%
y-o-y in January, up marginally from 0.2% the previous month and confirming the return to positive growth
in November. With trend growth around 2.5%, the recovery in production clearly has a long way to go.
Meanwhile, we believe that real global consumption growth has bottomed, with 1.9% y-o-y growth in Q412
marking an uptick from what we believe to be the trough of 1.7% in Q312.
The most notable growth forecast changes include a downgrade of the eurozone growth forecast in 2013 to
-0.1% (from 0.0% previously), which incorporates a downward revision to our projections for key eurozone
members including the Netherlands and Italy. We have also downgraded the US growth outlook slightly for
2013, owing mainly to base effects from a poor end to 2012; we still expect a second half rebound in
growth, followed by a stronger 2014, however. Meanwhile, we have upgraded our Japanese growth
forecasts owing to increasingly expansionary fiscal and monetary policy, but we remain wary of the long-
term outlook.

Table: Global Assumptions
2012e 2013f 2014f 2015f 2016f 2017f 2018f
Real GDP Growth (%)
USA 2.2 2.1 2.7 2.6 2.4 2.4 2.4
Eurozone -0.6 -0.1 1.1 1.5 1.7 1.8 1.8
Japan 1.9 1.4 1.3 1.0 0.9 1.1 1.0
China 7.7 7.5 6.7 6.0 5.8 5.8 5.8
World 2.7 2.9 3.4 3.4 3.4 3.5 3.5
Consumer Inflation (avg)
USA 2.1 2.1 2.1 2.1 2.1 2.1 2.1
Eurozone 2.3 1.8 1.8 1.9 2.1 2.2 2.0
Japan 0.0 0.0 0.6 1.3 1.8 2.3 2.7
China 2.7 2.8 2.9 2.8 2.7 2.7 2.7
World 3.5 3.4 3.3 3.2 3.2 3.2 3.2
Interest Rates (Eop)
Fed Funds Rate 0.00 0.00 0.00 0.00 1.00 2.25 3.00
ECB Refinancing Rate 0.75 0.75 0.75 0.75 1.00 1.50 2.00
Japan Overnight Call Rate 0.10 0.10 0.10 0.10 0.25 0.50 0.75
Exchange Rates (avg)
US$/EUR 1.27 1.34 1.27 1.23 1.20 1.20 1.20
JPY/US$ 79.85 91.00 94.00 97.00 98.50 100.50 93.75
CNY/US$ 6.31 6.27 6.38 6.45 6.55 6.60 6.60
Oil Prices (avg)
OPEC Basket (US$/bbl) 109.50 104.40 101.00 95.20 93.25 93.30 93.35
Brent Crude (US$/bbl) 111.70 110.00 105.00 102.50 101.00 99.00 99.00
Source: BMI

We have revised down our British pound sterling average forecast to US$1.53/GBP from US$1.61/GBP in
2013, and to US$1.57/GBP from US$1.60/GBP in 2014. Although we have been targeting the US
$1.55-1.65/GBP range for a while now, we warn that the outlook for the pound is now fundamentally
changing for the worse, with substantial monetary easing, the government's austerity drive losing
credibility, and the reversal of safe haven flows to the UK.

Table: Global And Regional Real GDP Growth, % chg y-o-y
2012e 2013f 2014f 2015f
World 2.7 2.9 3.4 3.4
Developed States 1.2 1.2 1.9 2.0
Emerging Markets 4.7 4.9 5.1 5.0
Asia Ex-Japan 6.1 6.3 6.1 5.6
Latin America 2.8 3.5 3.7 3.8
Emerging Europe 2.5 3.0 3.7 4.3
Sub - Saharan Africa 4.3 5.8 5.8 6.1
Middle East & North Africa 4.8 3.9 4.5 4.0
Table: Developed Market Exchange Rates
2012e 2013f 2014f 2015f
Eurozone US$/EUR, ave 1.27 1.34 1.27 1.23
Japan JPY/US$, ave 79.85 91.00 94.00 97.00
Switzerland CHF/US$, ave 0.94 1.03 1.07 1.06
United Kingdom US$/GBP, ave 1.59 1.53 1.57 1.60
Table: Emerging Market Exchange Rates
2012e 2013f 2014f 2015f
China CNY/US$, ave 6.31 6.27 6.38 6.45
South Korea KRW/US$, ave 1,126.39 1,150.00 1,100.00 1,050.00
India INR/US$, ave 53.42 52.00 51.00 49.00
Brazil BRL/US$, ave 1.95 2.00 2.10 2.23
Mexico MXN/US$, ave 13.15 12.50 12.30 12.50
Russia RUB/US$, ave 31.06 30.51 31.25 31.75
Turkey TRY/US$, ave 1.80 1.80 1.79 1.79
South Africa ZAR/US$, ave 8.21 8.99 9.55 9.64
Source: BMI

Developed States
Our developed state aggregate growth estimate for 2013 has fallen slightly to 1.2% from 1.3%, while we
continue to eye a rebound in 2014 to 1.9%. We have downgraded our US forecast for 2013 to 2.1% from
2.3%, due mainly to negative base effects from late 2012. Nonetheless, our core view remains the same,
which is that US economic activity should pick up as the year progresses, led by business and residential
investment. Our 2014 growth forecast of 2.7% represents a major bounce from 2013, and is an upgrade
from our previous projection of 2.5%.
With US macro data looking strong, the Cyprus-triggered uncertainty in the euro area stands in stark relief.
We have made downgrades to our 2013 real GDP growth forecasts for Italy, the Netherlands, and Portugal,
which have translated into a drop in our 2013 eurozone growth forecast to -0.1% from 0.0% previously, and
for 2014 to 1.1% from 1.2%.
With leading indicators in Japan showing much sought-after improvements, we believe the optimism of a
fiscal and monetary regime change will help drive a pickup in economic activity in 2013. As such, we have
revised up our forecast for Japanese real GDP growth in 2013 to 1.4% from our previous forecast of 0.9%.
That said, we maintain our view that the government's policies will not return the Japanese economy back to
the path of recovery, but rather heighten the risk of a fiscal crisis.
Table: Developed States, Real GDP Growth Forecasts
2012e 2013f 2014f 2015f
Developed States Aggregate Growth 1.2 1.2 1.9 2.0
G7 1.4 1.4 2.0 2.1
Eurozone -0.6 -0.1 1.1 1.5
EU-27 -0.4 0.2 1.3 1.8
Selected Developed States
Australia 3.6 2.1 1.8 2.5
Austria 0.4 0.9 1.5 1.9
Belgium -0.5 0.4 1.6 1.9
Canada 2.0 1.9 2.5 2.5
Denmark -0.1 1.2 1.4 1.6

Developed States, Real GDP Growth Forecasts - Continued
2012e 2013f 2014f 2015f
Finland -0.4 0.8 1.5 1.9
France 0.1 0.4 0.9 1.6
Germany 0.7 0.8 1.9 1.8
Ireland -0.5 0.3 1.4 2.0
Italy -2.4 -1.3 0.1 0.7
Japan 1.9 1.4 1.3 1.0
Netherlands -1.1 -0.6 0.9 1.5
Norway 3.2 2.8 2.5 2.5
Portugal -3.2 -2.4 0.3 0.7
Spain -1.4 -1.7 0.3 1.1
Sweden 0.8 1.0 2.5 3.2
Switzerland 0.7 1.5 1.8 1.6
United Kingdom 0.0 1.1 1.4 2.0
United States of America 2.2 2.1 2.7 2.6
Source: BMI

Emerging Markets
We estimate emerging market (EM) real GDP growth of 4.9% in 2013, with a slight acceleration in growth
in 2014 to 5.1%. Our forecasts for most EM countries have remained relatively stable since our last monthly
update, with downgrades to our forecasts for Thailand and Turkey representing the most notable changes.
Emerging Asia will remain an economic outperformer, with real GDP growth of 6.3% in 2013 reflective of
a strong but temporary bounce in Chinese activity in H113 (the 2014 and 2015 projections mark a
deceleration to 6.1% and 5.6%, respectively, from 7.5% in 2013). China's economic recovery continues to
gain traction and we expect this to remain the case over the coming months. Signs of an early tightening
cycle have faded in recent months, and inflation, although picking up, is of no real concern as of yet.
However, we remain bearish on the country's growth prospects over H213 as rising inflation is set to put
pressure on the People's Bank of China to cool the economy once again. Meanwhile, growth in Latin
America, Sub-Saharan Africa, and emerging Europe is also set to pick up the pace in 2013, with reasonably
steady growth going into 2014.
Table: Emerging Markets, Real GDP Growth Forecasts
2012e 2013f 2014f 2015f
Emerging Markets Aggregate Growth 4.7 4.9 5.1 5.0
Latin America 2.8 3.5 3.7 3.8
Argentina 2.0 1.6 3.0 3.9
Brazil 0.9 3.5 3.6 3.9
Mexico 3.9 3.6 3.8 3.5
Middle East 4.8 3.9 4.5 4.0
Sub-Saharan Africa 4.3 5.8 5.8 6.1
South Africa 2.3 2.8 3.4 3.5
Nigeria 6.6 6.8 7.2 7.3
Saudi Arabia 6.8 4.1 3.7 2.3
UAE 3.9 3.7 3.8 3.8
Egypt 2.2 2.6 3.7 5.6

Emerging Markets, Real GDP Growth Forecasts - Continued
2012e 2013f 2014f 2015f
Emerging Asia 6.1 6.3 6.1 5.6
China 7.7 7.5 6.7 6.0
Hong Kong 1.4 3.3 3.6 3.7
India* 5.0 6.2 6.7 6.6
Indonesia 6.2 6.1 6.4 6.5
Malaysia 5.6 4.6 4.4 4.2
Singapore 1.3 2.5 3.2 3.2
South Korea 2.1 3.0 4.6 4.6
Taiwan 1.3 3.0 4.0 4.1
Thailand 6.4 4.0 4.5 4.4
Emerging Europe 2.5 3.0 3.7 4.3
Russia 3.6 3.4 3.6 4.1
Turkey 2.6 4.0 4.7 5.2
Czech Republic -1.2 0.5 1.9 2.4
Hungary -1.7 -0.2 1.9 2.7
Poland 2.0 1.9 3.0 4.1
BMI is below consensus on growth in China (compared with the Bloomberg survey of analysts). However,
we are more optimistic on the growth prospects of India and the US. We are in line with consensus on the
eurozone.

Table: BMI Versus Bloomberg Consensus Real GDP Growth Forecasts (%)
US Eurozone Japan Brazil China Russia India
2013 Bloomberg Consensus 1.9 -0.1 1.2 3.4 8.1 3.4 5.4
BMI 2.1 -0.1 1.4 3.5 7.5 3.4 6.2
2014 Bloomberg Consensus 2.7 1.1 1.3 4.0 8.0 3.8 6.5
BMI 2.7 1.1 1.3 3.6 6.7 3.6 6.7
Source: BMI, Bloomberg

Demographic Forecast
Demographic analysis is a key pillar of BMI's macroeconomic and industry forecasting model. Not only is
the total population of a country a key variable in consumer demand, but an understanding of the
demographic profile is key to understanding issues ranging from future population trends to productivity
growth and government spending requirements.
The accompanying charts detail Vietnam's population pyramid for 2011, the change in the structure of the
population between 2011 and 2050 and the total population between 1990 and 2050, as well as life
expectancy. The tables show key datapoints from all of these charts, in addition to important metrics
including the dependency ratio and the urban/rural split.
Source: World Bank, UN, BMI

Table: Vietnam's Population By Age Group, 1990-2020 ('000)
1990 1995 2000 2005 2010 2012e 2015f 2020f
Total 67,102 74,008 78,758 83,161 87,848 89,730 92,443 96,355
0-4 years 9,340 9,212 7,002 6,776 7,186 7,186 7,026 6,529
5-9 years 8,685 9,193 9,124 6,921 6,703 6,885 7,143 6,982
10-14 years 7,504 8,604 9,142 9,038 6,844 6,539 6,668 7,104
15-19 years 7,127 7,408 8,535 9,064 8,963 8,161 6,806 6,628
20-24 years 6,492 7,003 7,305 8,420 8,954 9,115 8,892 6,745
25-29 years 5,893 6,361 6,879 7,167 8,284 8,602 8,862 8,803
30-34 years 4,884 5,779 6,250 6,765 7,058 7,475 8,202 8,779
35-39 years 3,965 4,794 5,688 6,163 6,677 6,770 6,991 8,131
40-44 years 2,420 3,884 4,710 5,614 6,086 6,304 6,609 6,925
45-49 years 2,039 2,358 3,802 4,653 5,548 5,761 6,012 6,536
50-54 years 1,933 1,968 2,287 3,739 4,580 4,936 5,449 5,914
55-59 years 1,946 1,843 1,887 2,201 3,617 4,001 4,446 5,305
60-64 years 1,544 1,822 1,737 1,767 2,076 2,573 3,455 4,268
65-69 years 1,283 1,391 1,659 1,582 1,621 1,649 1,927 3,233
70-74 years 919 1,084 1,194 1,439 1,389 1,384 1,438 1,729
75+ years 1,127 1,305 1,559 1,852 2,264 2,388 2,516 2,743
f = BMI forecast. Source: World Bank, UN, BMI

Table: Vietnam's Population By Age Group, 1990-2020 (% of total)
1990 1995 2000 2005 2010 2012 2015f 2020f
0-4 years 13.92 12.45 8.89 8.15 8.18 8.01 7.60 6.78
5-9 years 12.94 12.42 11.58 8.32 7.63 7.67 7.73 7.25
10-14 years 11.18 11.63 11.61 10.87 7.79 7.29 7.21 7.37
15-19 years 10.62 10.01 10.84 10.90 10.20 9.10 7.36 6.88
20-24 years 9.68 9.46 9.27 10.13 10.19 10.16 9.62 7.00
25-29 years 8.78 8.60 8.73 8.62 9.43 9.59 9.59 9.14
30-34 years 7.28 7.81 7.94 8.14 8.03 8.33 8.87 9.11
35-39 years 5.91 6.48 7.22 7.41 7.60 7.55 7.56 8.44
40-44 years 3.61 5.25 5.98 6.75 6.93 7.03 7.15 7.19
45-49 years 3.04 3.19 4.83 5.59 6.32 6.42 6.50 6.78
50-54 years 2.88 2.66 2.90 4.50 5.21 5.50 5.89 6.14
55-59 years 2.90 2.49 2.40 2.65 4.12 4.46 4.81 5.51
60-64 years 2.30 2.46 2.21 2.12 2.36 2.87 3.74 4.43
65-69 years 1.91 1.88 2.11 1.90 1.85 1.84 2.08 3.36
70-74 years 1.37 1.46 1.52 1.73 1.58 1.54 1.56 1.79
75+ years 1.68 1.76 1.98 2.23 2.58 2.66 2.72 2.85

Table: Vietnam's Key Population Ratios, 1990-2020
1990 1995 2000 2005 2010 2012 2015f 2020f
Dependent ratio, % of total working age 1 75.5 71.2 60.5 49.7 42.1 40.9 40.6 41.6
Dependent population, total, '000 2 28,859 30,790 29,679 27,609 26,006 26,031 26,717 28,321
Active population, % of total 3 57.0 58.4 62.3 66.8 70.4 71.0 71.1 70.6
Active population, total, '000 4 38,243 43,218 49,079 55,552 61,842 63,699 65,725 68,034
Youth population, % of total working age 5 66.8 62.5 51.5 40.9 33.5 32.4 31.7 30.3
Youth population, total, '000 6 25,529 27,009 25,268 22,735 20,732 20,610 20,837 20,615
Pensionable population, % of total working
age 7 8.7 8.7 9.0 8.8 8.5 8.5 8.9 11.3
Pensionable population, '000 8 3,330 3,780 4,411 4,874 5,274 5,421 5,881 7,706
f = BMI forecast; 1 0>15 plus 65+, as % of total working age population; 2 0>15 plus 65+; 3 15-64, as % of total
population; 4 15-64; 5 0>15, % of total working age population; 6 0>15; 7 65+, % of total working age population; 8 65+.
Source: World Bank, UN, BMI
Table: Vietnam's Rural And Urban Population, 1990-2020
1990 1995 2000 2005 2010 2012 2015f 2020f
Urban population, % of
total 20.3 22.2 24.3 26.4 28.7 29.7 31.2 33.9
Rural population, % of total 79.7 77.8 75.7 73.6 71.3 70.3 68.8 66.1
Urban population, '000 13,438.6 16,201.6 18,865.4 21,940.1 25,212.5 26,649.9 28,842.1 32,664.4
Rural population, '000 52,761.4 56,778.4 58,770.0 61,166.2 62,635.9 63,080.4 63,600.5 63,690.7

Methodology
Methodology
BMI's industry forecasts are generated using the best-practice techniques of time-series modelling. The
precise form of time-series model we use varies from industry to industry, in each case being determined, as
per standard practice, by the prevailing features of the industry data being examined. For example, data for
some industries may be particularly prone to seasonality, ie seasonal trends. In other industries, there may
be pronounced non-linearity, whereby large recessions, for example, may occur more frequently than
cyclical booms.
Our approach varies from industry to industry. Common to our analysis of every industry, however, is the
use of vector autoregressions. Vector autoregressions allow us to forecast a variable using more than the
variable's own history as explanatory information. For example, when forecasting oil prices, we can include
information about oil consumption, supply and capacity.
When forecasting for some of our industry sub-component variables, however, using a variable's own
history is often the most desirable method of analysis. Such single-variable analysis is called univariate
modelling. We use the most common and versatile form of univariate models: the autoregressive moving
average model (ARMA).
In some cases, ARMA techniques are inappropriate because there is insufficient historic data or data quality
is poor. In such cases, we use either traditional decomposition methods or smoothing methods as a basis for
analysis and forecasting.
It must be remembered that human intervention plays a necessary and desirable part in all of our industry
forecasting techniques. Intimate knowledge of the data and industry ensures we spot structural breaks,
anomalous data, turning points and seasonal features where a purely mechanical forecasting process would
not.
Tourism Industry
There are a number of principal criteria that drive our forecasts for each tourism sector variable.
Figures for the tourism sector data are based, where possible, on industry associations/operators,
government/ministry sources and official data. Where these are unavailable, tourism forecasts are based on
a range of variables:

■ Government policy, industry trends and expenditure levels stated in international and national press.
■ Industry trends and expenditure levels stated in tourism company official financial reports or releases.
■ Likely expenditure and growth patterns owing to international developments and demographic patterns.
■ Likely alterations in expenditure patterns owing to economic/political activity.
Tourism Ratings - Methodology
Our approach in BMI's Tourism Risk/Reward Ratings (RRRs) is threefold. First, we seek accurately to
capture the operational dangers to companies operating in this industry globally. Second, we attempt, where
possible, to identify objective indicators that may serve as proxies for indicators that were traditionally
evaluated on a subjective basis. Finally, we include aspects of BMI's proprietary Country Risk Ratings
(CRR) that are relevant to the tourism industry. Overall, the ratings system, which integrates with those of
all 16 industries covered by BMI, offers an industry-leading insight into the prospects/risks for companies
across the globe.
Ratings System
Conceptually the ratings system divides into two distinct areas:
Rewards: Evaluation of sector's size and growth potential in each state, and also broader industry/state
characteristics that may inhibit its development.
Risks: Evaluation of industry-specific dangers and those emanating from the state's political/economic
profile that call into question the likelihood of anticipated returns being realised over the assessed time
period.
Indicators
The following indicators have been used. Overall, the rating uses three subjectively-measured indicators,
and 41 separate indicators/datasets.

Tourism Vietnam - q3 - 2013

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