“Less Oil, More Tourists” - A More Sustainable Policy for Vietnam, Says HSBC

Tuan Minh

10:37 03/11/2017

BizLIVE - Boosting the tourism industry has been and will take over the role of the oil and gas sector to drive the Vietnamese economy forward, according to HSBC.

“Less Oil, More Tourists” - A More Sustainable Policy for Vietnam, Says HSBC

Tourism will replace oil production to become a new engine of Vietnam's economy.

The Vietnamese government’s shift to incentivizing more visitors to the country amidst dwindling oil production is reckoned a more sustainable policy, HSBC has said in its monthly update titled “Out with oil, in with tourism”.
The country is looking for new growth channels amidst falling crude oil production. Deputy Prime Minister Vuong Dinh Hue said on October 24 in a meeting with legislators that crude oil production will fall about 3 million metric tons in 2017, which would be equivalent to a 0.75% drop in GDP.
However, he also noted that tourism and related services could make up for the drop in crude oil output, given the sector's growing share in the economy.
“We believe this to be a sustainable policy for the Vietnamese government, given the country's dwindling fossil fuel output and its growing services industry,” said Noelan Arbis, economist at HSBC.
The report pointed out that the government has announced visa liberalization programs over the past year to attract more tourists into the country, which appears to have worked.
“As such, we remain optimistic on Vietnam's tourism sector and expect visitor numbers to exceed 10 million moving forward, just as it did in 2016 and is tracking to replicate this year, provided greater liberalization, continued improvement in infrastructure, and a benign external economic and political environment,” the report adds.


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