Last week, the US Department of Transportation’s Federal Aviation Administration (FAA) announced in a press release that Vietnam’s aviation industry meets the international safety requirements. The approval means that Vietnam carriers can now open direct flights from the S-shaped country to the US.
It is a huge announcement. There are hundreds of folks traveling back and forth between the two countries on a daily basis, whether it’s for business, leisure or just a quick family visit. As of this writing, flights from Vietnam to the US have at least one layover. If you live in a less popular city like myself in Omaha, it will require at least two stops. In my experience, it took me 3 stops and at least 33 hours for a one-way trip. Layovers are just a waste of time. It’s not just about the time spent at the airports, but also about the hassle in scheduling.
Direct flights will definitely ease the pain and facilitate the travel between the countries. It’s a boon for tourism and commerce. So much productivity can be saved. American travelers will be more tempted to visit Vietnam as the first destination in the region when the flights are no longer as long and taxing as they were.
I am really excited about this development for my country. Becoming a flight hub matters a great deal to our tourism and economy. There is still a very long way to go, but it’s a bright first step. I really hope the carriers in Vietnam will jump at this opportunity.
For the past few days, I saw some positive articles on the economic performance of Vietnam. First, the GDP growth rate in 2018 is the highest in 11 years, reaching 7.08%
Our trade surplus reached $7 billion in 2018
This is Vietnam’s GDP per capita compared to neighboring countries
Even though the GDP per capita is around $2,500, there is a wide gap in terms of income between cities in Vietnam. In big cities such as Ho Chi Minh (or Saigon) and Hanoi, the income level is much higher than the GDP per capita mark. When I was still working in the country back in 2014, my salary after tax was already around the $1,400/month. Granted, the living cost in Saigon and Hanoi is pretty expensive as well. In fact, students who study abroad usually complain about the high living cost in the two cities in Vietnam, given the low income in comparison with cities in Western countries. On the other hand, in other cities, an income of $300 – $400 can be considered very good. It goes to show the stark difference between cities in Vietnam.
The last time Vietnam’s GDP growth was below 5% was in 1999, almost 20 years ago. Hence, we have seen the growth rate in the region of 5-7% for almost two decades. Yet, I am not so confident in the future of the country. The infrastructure is abysmal. Here are a few photos of the infrastructure in Saigon and Hanoi that is terribly under-developed.
The country’s first metro project was started in 2007. 12 years later, the budget for the project increased by 300%, compared to the initial outlay. Yet, only 56% has been completed so far. The project can be halted in the near future if the bottlenecks are not settled.
At the time of approval in 2007, Metro Line 1 was projected to cost VND17.388 trillion. This ballooned to VND47 trillion over the years. The Japan International Cooperation Agency (JICA) shoulders 88.4% of the budget in the form of official development assistance loan (ODA).
As a Saigon native, I experienced first-hand for years the terrible infrastructure of my city. The streets were built several decades ago. Back then, there were not as many inhabitants in the city as there are now. Not even close. Fast forward, many people from poorer cities flock to the city for better career opportunities and income. More cars are bought and run. More big buses are operated. More houses are built. Yet, the drainage system and the streets in the city haven’t been upgraded accordingly. It usually took me 30 mins to commute over a distance of 10km with my scooter. The only time that the city doesn’t have traffic jam is probably before 7am and after 8pm.
From Saigon to Vungtau, a distance of 120km, it takes two hours and the travel can be pretty dangerous if you ride a scooter. In China, it takes 4.5 hours to travel from Shanghai to Beijing or vice versa, a distance of more than 1,300km. The difference cannot be bigger.
If you fly domestically in Vietnam, take my word. Either go extremely late or first flight in the morning. Any flight between 7AM and 10PM is almost guaranteed to be delayed. One of the reasons for the horrible delays is that the airports cannot accommodate the number of flights and aircrafts.
A country needs a robust infrastructure to grow. Right now, Vietnam doesn’t have that. I am not confident in the possibility that it will change any time soon in the future.
Furthermore, I am not a big fan of growing by being the source of cheap labor, being the factory of the world. It’s ok in the beginning, but it’s not sustainable in the long run. Vietnam needs to look at Singapore or Nordic countries to get some inspiration and lessons for using education and services to grow the economy. Plus, the infrastructure is amazing, at least in Finland.
Well, it’s finally and officially here! Formula 1 Vietnam Grand Prix is officially the latest addition to the calendar in 2020. As a long-time F1 fanatic, I am thrilled by this news. Our country will have an international sport event that will attract tourists and increase our country’s brand awareness. It’s not surprising to me any more that many people don’t know much about Vietnam. Hopefully, this event and all the publicity that comes with it will help make Vietnam more known on the world stage.
Formula 1 put together a cool video that shows the streets in Hanoi, where the race will take place. Check it out:
This is the track circuit. I am not a fan of street circuits, except Baku with its magical long straight and turn 1. I hope this track will be just as exciting
First of all, if you are looking for a website to learn more about Vietnam and particularly Saigon, I highly recommend this website – Saigoneer. Its section on street food is a great start. It’s in English and has lots of details.
There are a few upcoming initiatives announced recently in the industry:
There will be bi-weekly direct flights form Zurich to Saigon
Vietnam Airlines will soon operate direct flights from Danang to Japan
Vietnam Airlines is exploring the possibility of direct flights from Vietnam to America
Vietnam Tourism Association will soon carry out exams to classify tour guides in the country. Tour guides will be given 3 to 5 stars based on the results of the exams which will be free of charge and voluntary. Also, freelance tour guides are now mandated to be under contracts with authorized tour companies in order to do business
BBC Sport reported that a 2020 race in Hanoi, Vietnam was now secured barring an official announcement
Three points here. First, the tourism industry brought in $13 billion in the first half of 2018, an increase of 22% compared to last year. It is huge for a country like Vietnam. We have a lot to offer. A long coast throughout the country. An authentic and exotic cuisine. We have beaches, mountains and Mekong Delta, everything that a tourist can hope to experience. But our tourism has been plagued by the lack of standards in services leading to the poor return rate of guests. Our country is pretty much a myth that is worth exploring once and no more. In business, it costs 6 times more to acquire a new customer than to retain one. This is the same case. Even though the tour guide exam’s effectiveness remains to be seen (we Vietnamese are not known for world class execution), it is a small step towards the right direction. If we want to compete and have more guests return, maintaining high service standards is instrumental.
Secondly, having more direct flights is huge. Thailand and Singapore have two airport hubs in the region and look what the airports have done to their tourism. Direct flights will reduce the hesitation from guests when they have to make a decision on where to visit. Vietnam’s two biggest airports sorely need major upgrade. It’s a pity that some bureaucracy red tape has prevented the expansion of the airport in Ho Chi Minh City. We have the land to do so and the airport is ridiculously right next to the city center. I have been to quite some airports and I haven’t seen one that close to a city center. Nonetheless, having more direct flights will increase our appeal as a destination.
Lastly, I have been hoping for annual international event in Vietnam for years. Singapore’s F1 Grand Prix has been a remarkable success since its debut in 2008. Otherwise, Singapore wouldn’t keep hosting it. A race is usually a combination of music concerts, press conference, other activities and of course the racing itself. With the reach of Formula 1, Vietnam’s brand awareness which has been under-marketed due to lackluster branding and marketing efforts will hopefully be boosted.
CNBC released a short video clip on McDonald’s and Burger King’s failure in Vietnam despite glowing success in other countries and particularly other Asian countries such as China and Japan. While McDonald’s and Burger King have struggled in Vietnam, Pizza Hut and KFC have managed to attain some success in the market.
The video mentioned the following as the main reasons for the failure:
A lot of substitutes at a much cheaper price from street vendors
Burgers don’t fit Vietnamese cuisine preference of sharing food during meals
Personally, I have lived in the US for more than two years and I can count on one hand the number of times I have been to chains such as Wendy’s, McDonald’s, Burger King or Chipotle. All of them were with friends or on our way back from trips. Burgers don’t appeal to us. We have a quite similar dish in Banh Mi, which is very delicious, quick to prepare and significantly cheaper. I lived in Danang for a year, the 3rd biggest city in Vietnam. It is half an hour of a scooter ride from Hoi An, where you can find some of the best Banh Mis in Vietnam. The price for local is about 50cents (maybe 1 dollar for foreigners), but the price at McDonald’s or Burger King’s restaurant is several times more expensive.
This is how Banh Mi is prepared and delivered, in about 1-2 minutes maximum. (Credit: Hoi An Tour Food)
I still remember the buzz when McDonald’s came to Vietnam the first time. People lined up to experience it. Nonetheless, when the hype wore off after a while, it comes down to whether McDonald’s offerings are competitive and whether they fit the culinary buds of the Vietnamese people. Apparently, they don’t. This is a failure of not understanding the end users’ preferences.
Towards the end of the clip, it was mentioned that McDonald’s is trying to localize the menus with Pho and Broken Rice. Well, I am not sure that will work because the same thing will happen. There are hundreds of street vendors whose product is so tasty and much cheaper than the well-known chain’s.
I was born and grew up in a family that could, at best, be described as a middle-income one in Vietnam. None of my family members went to university because of the wars and the economic difficulty that ensued. For a time, there was nothing I wanted more than going abroad at all cost without wrecking my family’s finance. Luck pitied me and gave me a chance to go to Finland. I landed in the Nordic country in February 2010. Whatever the joy of walking in a foreign land soon was extinguished by the cold at the peak winter in Finland. Or so I thought. Weeks passed by and I realized it wasn’t as much fun as I thought. It didn’t fill me up.
When I was ignorant and young around the teenage age, I set a goal of becoming a marketing manager for a company by the time I was 30 years old. I couldn’t remember what triggered the dream, but it was what I set out to do for a while. 3 years after I came back to Vietnam from abroad, I did it by merit and myself. The problem is what I felt after I did it. I remember vividly the first night after work as the Marketing Manager for a real estate corporation in Vietnam. I didn’t feel as much as I thought I would. I just felt tired and a bit empty. I didn’t feel ecstatic as I thought I would. It didn’t fill me up.
It took me quite a while after that to realize that whatever physical or materialistic goals I ever had never filled me up. The title, the money and what could be bought with it never filled me up. The best I felt was to learn new things every day either by reading, listening to videos online or talking to folks, and to spend time with the people who genuinely loved me and I genuinely loved back.
I am glad that at the age of 28, I realized that. I wouldn’t want at the age of 60, being an old man realizing that for years I have been chasing something that doesn’t make me happy. And at 80, there is not much I could do anymore. What a waste of life, isn’t it?
I know personally a few people who genuinely feel good with earning money and what it brings. I don’t think it inherently is bad or wrong. It is just not what makes me happy. If you are reading and feel the same, there is no shame in feeling it. It’s normal in my opinion.