There was a drop of 3 percent in Chinese bookings and 10 percent in revenue per available room in Vietnam's hospitality industry in the first half of 2019, according to a recent report by Savills Hotels, a Singapore-based dedicated division of Savills Group, one of the world's leading property agents.

In the first eight months of this year the number of Chinese arrivals in Vietnam was down 0.9 percent to 3.37 million, the General Statistics Office reported. The country received 11.3 million foreign visitors in the first eight months of this year, with Chinese accounting for 29.8 percent.

In China, the depreciation of the yuan, economic slowdown and the decline of the consumer confidence index have meant Chinese are traveling less than before, Savills Hotels noted.

The report, titled "Asia-Pacific Hospitality: A Review of the First Half of 2019", said that the first half had been a tough time for hotels in the Asia Pacific, with the majority reporting negative performances. Overall, the region witnessed a decrease of nearly 1.3 percent in occupancy compared to the same period last year and 5 percent in average room rates.

"China as the largest market for visitor arrivals within the Asia Pacific area, any changes could significantly impact the entire hospitality industry." 

An earlier boom in Chinese outbound travel fuelled tourism development across Southeast Asia, with new hotels and resorts springing up. But an abrupt decline has since affected the tourism industry in countries like Thailand, Indonesia and Vietnam, Bloomberg reported.

The decline is expected to continue in 2020 if the US-China trade war continues to weigh on the Chinese economy, Bloomberg quoted Kampon Adireksombat, head of economic and financial market research at Siam Commercial Bank Pcl, Bangkok, as saying.

Foreign tourists take a cyclo ride in Hanoi in February 2019.
Photo by VnExpress/Pham Duong

The Savills report said Vietnam is one of the most preferred destinations for Chinese tourists and leads the region in terms of room booking by Chinese.

More than four million Chinese visitors arrived in Vietnam last year, up 48.6 percent year-on-year, accounting for one third of all foreign arrivals.

According to the Chinese Tourism Academy and Ctrip Travel Agency, only 10 percent of Chinese own passports. But the rate is expected to double by 2020, and the number traveling abroad will increase, especially to countries in the region like Vietnam and Thailand.

CLSA, a Hong Kong brokerage and investment firm, has predicted that more than 200 million Chinese are expected to make outbound trips in 2020.