Current Status of Attracting Investment Capital into Tourism in

CHAPTER 2 : CURRENT STATE OF INVESTMENT CAPITAL ATTRACTION IN TOURISM IN VIETNAM

BA RIA VUNG TAU PROVINCE

2.1. Overview of tourism industry in Ba Ria Vung Tau province

2.1.1. Natural conditions

- Geographical location: Ba Ria - Vung Tau is a province in the Southeast region, bordering the three districts of Long Thanh, Long Khanh, Xuan Loc of Dong Nai province to the North, Can Gio district of Ho Chi Minh City to the West, Ham Tan district of Binh Thuan province to the East, and the East Sea to the South. With a total length of land boundary of 162km. Ba Ria - Vung Tau has a coastline of 100km (of which 72km is sandy beach that can be used as a beach).

The province's continental shelf is adjacent to the Truong Sa archipelago, which contains two extremely important resources: oil and seafood. Natural area 1,982.2 km 2 .

- Terrain: Ba Ria - Vung Tau has a terrain including mountains, hills, small plains and sand dunes, long sand dunes running along the coast creating a very beautiful scene. The three districts of Xuyen Moc, Long Dien and Dat Do are coastal plains and hills.

- Climate: Ba Ria - Vung Tau belongs to the tropical monsoon climate zone, from May to October there is the southwest monsoon, this is the rainy season. From November to April of the following year there is the northeast monsoon, this is the dry season. The average annual temperature is 27 degrees Celsius , few storms, and lots of sunshine.

2.1.2. Characteristics of cultural and social infrastructure

The whole province has 8 administrative units including: Vung Tau city, Ba Ria town; districts: Chau Duc, Xuyen Moc, Tan Thanh, Long Dien, Dat Do, Con Dao. The population of Ba Ria - Vung Tau province in 2009 (according to the results of the general population and housing census on April 1, 2009) was 994,837 people, population density: 502 people/km 2 .

The province currently has one university, four colleges and nearly 40 vocational training facilities, with the capacity to train nearly 10,000 workers with university, college and intermediate vocational degrees and nearly 20,000 primary vocational students each year. Vung Tau Tourism Vocational College alone trains more than 700 workers with college and intermediate degrees each year to serve the tourism industry. This is a skilled workforce, partly meeting the human resource needs of units and businesses in the area.

2.1.3. Technical infrastructure and service conditions

Along with the socio-economic development, the technical infrastructure system and services in Ba Ria - Vung Tau province such as transportation, electricity, water, communications... have been improved.

Significant improvement, positive effects on local tourism development, contributing to increasing passenger transport capacity, accessibility to tourist attractions, creating favorable conditions for tourists' activities and being an important factor promoting tourism development in the coming time.

2.1.3.1. Transport system

- Road network: Currently, Ba Ria - Vung Tau province has been connected with other provinces and the whole country on 3 national highways 51, 56, 55. In particular, national highway 51 has been upgraded to 4 lanes, very convenient and fast from Vung Tau to Ho Chi Minh City. On Thi Vai river, Phuoc An bridge has been newly built on the Southern inter-regional highway. Most of the inter-district roads and urban roads have been asphalted.

- Waterway network: There are more than 20 rivers and canals with a length of about 200km with some river mouths and coastlines that are very suitable for the development of river ports and seaports such as: Thi Vai River, Dinh River, Sao Mai-Ben Dinh sea area, Phuoc Tinh, Loc An, Ben Dam (Con Dao), Long Son... Sea routes from the province can go everywhere in the country and internationally; in which 2 important passenger routes are the route from Vung Tau to Ho Chi Minh City by hydrofoil and the route from Vung Tau to Con Dao. Regarding waterways, there is the route from Vung Tau to the provinces of the Southwest and Vung Tau to Long Son.

- Air route: currently there are only 2 airports serving passenger transport and oil and gas exploitation: Vung Tau airport (with a 1,800m long runway) and Co Ong - Con Dao airport (with a 1,200m long runway).

2.1.3.2. Water supply system

In cities, towns, and townships, water supply works are constantly being improved and upgraded. The network of 6 water plants with a total capacity of about 58,000m3 / day and night is enough to meet the needs of water use with good quality and capacity to ensure long-term water use. This is also a favorable condition to attract investment capital for the tourism industry in Ba Ria - Vung Tau.

2.1.3.3. Information technology system

Up to now, in all places with scenic spots in the province, there are landlines, mobile phone coverage and Internet connection... creating a tourism information network connecting tourism service management units together, connecting tourism service providers with customers. Computer systems have been put into service for most services: management, payment, entertainment services, television at conferences.

large number of tourists, all these conditions are met accordingly with the hotel types

3-5 stars meet international standards.

2.1.3.4. Financial-banking-insurance services system

Ba Ria - Vung Tau is one of the provinces with the fastest development of the banking system in the country. Currently, the province has 33 commercial bank branches and 1 financial company providing services. Banks serve the mobilization of capital in the economy and meet the capital needs for production, business and investment activities of the state, enterprises and people. In addition, banks also act as payment intermediaries and manage payment means to facilitate the acceleration of capital circulation and promote the circulation of goods.

In addition to the above banking system, there are also 18 domestic and foreign insurance companies in the province providing life and non-life insurance services.

The conditions of the financial-banking and insurance service system have contributed to satisfying the needs of businesses and residents in the area.

2.1.4. Tourism resources

- Regarding natural resources: Ba Ria-Vung Tau has Con Dao National Park, an area of 6,043 hectares, including 16 islands, Binh Chau Phuoc Buu Conservation Area (area over 11,000 hectares) with many rich flora and fauna; hot spring area with temperature over 80 0 C, many mountains with beautiful landscapes such as: Minh Dam Mountain, Dinh Mountain, Lon Mountain, Nho Mountain... In the over 100km length of Ba Ria-Vung Tau coastline, there are 72km of good beaches with attractive terrain and landscapes such as: Front Beach, Back Beach, Pineapple Beach, Dau Beach, Long Hai-Phuoc Hai Beach...; including areas forming national and international tourist areas.

International such as: Con Dao Tourist Area, Long Hai - Phuoc Hai Tourist Area are 2 out of 20 national tourist areas in the country that have been recognized by the Government. Especially, Con Dao is home to Con Dao National Park with a rich and diverse flora and fauna with a system of small islands with many attractive landscapes.

- Regarding human resources: Ba Ria-Vung Tau is home to many ancient historical and cultural relics. Archaeological studies have shown the presence of cultural vestiges of the Neolithic period (Hang Duong site in Con Dao) and the early Bronze Age (Bung Bac, Xuan Son, Sa Huynh, Dong Nai sites) which were cultures that developed continuously here from the second millennium BC to the first century AD. However, it is worth noting that

Ba Ria-Vung Tau is a province with a large number of ranked relics. Up to now, the whole province has 31 relics recognized by the State as national level and 152 other relics have been inventoried and recorded for management. Historical and architectural relics of religions include: Thang Tam Communal House, Ba Temple, Whale Temple, Thich Ca Buddha Temple, Long Ban Pagoda... Historical and revolutionary relics include: Long Phuoc Tunnels, Bau Sen Resistance Base of the province and the region during the anti-American period, Hang Duong Cemetery Con Dao, Minh Dam Mountain Base, Loc An Wharf with Ho Chi Minh Trail at sea, Kim Long Tunnels...

Festivals and folk culture: festivals in Ba Ria - Vung Tau province are mainly related to religious and belief activities such as: Dinh Co festival (Long Hai) takes place from the 10th to the 12th of the second lunar month every year, Trung Cuu festival on the 9th of September (Long Son), Cau Ngu festival (whale procession) is held at Lang Ca Ong, Thang Tam communal house (Vung Tau) on the 16th of the 8th lunar month every year, Ba temple festival takes place on the 16th, 17th, and 18th of the 10th lunar month. These are favorable factors to attract spiritual tourism, sightseeing, sightseeing combined with swimming and relaxation.

2.1.5. Results of implementing key indicators

2.1.5.1. Tourist and tourism revenue indicators

In the last 5 years, the tourism industry in Ba Ria - Vung Tau has had strong growth: if in 2006 the number of tourists to Ba Ria - Vung Tau reached 5.56 million, then by 2010 the number of tourists to Ba Ria - Vung Tau reached 8.43 million with an average annual growth rate of 11%; in 2006 the revenue reached

1,005 billion VND, then by 2010 the revenue was 1,782 billion VND with an average annual growth rate of over 15%.

The table below provides data on tourism revenue and numbers.

Tourists to Ba Ria - Vung Tau Province during this period are as follows:

Table 2.1 Number of visitors and tourism revenue in Ba Ria Vung Tau province in the period 2006-2010

Interpretation	Unit	2006	2007	2008	2009	2010
1	Number of guests	thousand times	5.560	6.015	6,766	7,730	8,435
2	Revenue	billion dong	1,005	1,075	1,248	1,564	1,782
3	Revenue growth	%	12.92	6.97	16.09	25.30	13.39

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(Source: Department of Culture - Sports and Tourism of Ba Ria - Vung Tau province)

Through the table of data, we can see that tourism activities are still growing strongly and quite stable over the years and is a clear proof that the tourism industry in Ba Ria - Vung Tau has achieved certain achievements, Ba Ria - Vung Tau tourism is increasingly affirming its reputation in the market.

2.1.5.2. Facilities and equipment conditions:

In recent years, to meet the increasing number of tourists as well as the increasing demands for quality tourism products of tourists, Ba Ria - Vung Tau tourism enterprises have continuously invested in increasing both quantity and quality as well as the quality of technical facilities in a modern direction with an increasingly larger scale. The table shows the investment situation of accommodation facilities in Ba Ria - Vung Tau province from 2006-2010 as follows:

Table 2.2. Number of accommodation establishments in Ba Ria Vung Tau province in the period 2006-2010

Interpretation	Unit	2006	2007	2008	2009	2010
1	Number of accommodation establishments	base	93	126	121	148	162
2	Number of rooms	room	3,720	4,959	5,040	6.189	6,722
	In there
3	Number of star rated accommodations	base	75	84	85	111	117
4	Number of rooms	room	3,248	3.307	3,510	4.412	5.246

(Source: Department of Culture - Sports and Tourism of Ba Ria - Vung Tau province)

The table shows that the number of accommodation establishments has increased steadily over the years with an average growth rate of 15%, causing the number of accommodation rooms to increase continuously over the years. By the end of 2010, the number of tourist accommodation establishments in the province was 162, with 6,722 rooms. Of which, 117 accommodation establishments were rated with 5,246 rooms (including 01 5-star hotel, 07 4-star hotels, 10 3-star hotels, 30 2-star hotels, 27 1-star hotels, 1 cluster of luxury villas, 2 luxury apartments). In addition, there are 681 establishments with 3,872 rooms that are tourist accommodation establishments of individual business households.

The current trend is that tourism businesses are building large-scale tourist accommodation facilities with increasingly modern equipment. Many private hotels focus on investing in expanding their scale, upgrading equipment, and improving service quality to be considered for upgrading to 3 to 5 stars.

2.1.5.3. Regarding construction and exploitation of tourist routes and destinations:

In addition to the tourist attractions, entertainment and recreation areas established in previous years that have always been effectively exploited and continuously invested in, improving business quality such as Binh Chau mineral spring, Con Dao National Park, ... some new tourist attractions have been formed and put into operation such as Ben Thanh-Long Hai tourist area, Ho Coc marine eco-tourism area and some large projects are completing procedures to implement the project such as: Saigon Atlantis, Ho Tram Strip, Safari Binh Chau semi-wild zoo, ... The Department of Culture, Sports and Tourism is always proactive, actively coordinating with departments, branches, localities and related units to promote the survey and construction of new tourist routes and destinations to serve tourists. Completing the participating tourist routes, ecological routes... in addition to the tourist destinations and routes in the province, it has strengthened coordination with provinces in the Central region, Hanoi and Ho Chi Minh City to survey and open inter-provincial routes according to the signed cooperation program.

The potential for exploiting tourist routes and destinations is still very large. However, in order to exploit and manage tourist destinations effectively, avoid affecting the landscape and environment, protect tourism resources, and build a safe and sustainable tourism environment, there needs to be synchronous coordination between levels and sectors; there needs to be a specific division of labor and decentralization in managing the business exploitation activities of tourist routes and destinations.

2.2. Current status of attracting investment capital into tourism industry of Ba Ria Vung Tau province from 2006 to 2010

2.2.1. Investment attraction situation

2.2.1.1. Investment attraction policy

In recent times, Ba Ria - Vung Tau province has had many policies to attract investment such as tax incentives, investment encouragement and support policies in Ba Ria - Vung Tau province. Ba Ria - Vung Tau has gradually affirmed that this is a potential land to attract large projects, especially tourism projects. A clear proof of this is that Ba Ria - Vung Tau has had the following policies:

- Well implement planning work as a basis for calling for investment : approve the master plan for tourism development in Tan Thanh district, the master plan for tourism development in Vung Tau city; have completed and are appraising to soon approve the master plan for tourism development in Long Dien district. Con Dao tourism development planning according to the Government's project to develop Con Dao into a Special Economic Tourism Zone

The planning task has been approved by the People's Committee. The Institute for Tourism Development Research has completed the draft planning project, collected comments from relevant agencies and is continuing to edit and complete it in preparation for approval by the Provincial People's Committee.

- Synchronous infrastructure development : by spending thousands of billions of VND to develop infrastructure systems outside the fence, traffic, electricity, water... Investors coming to Ba Ria - Vung Tau no longer have to worry about the overload of the traffic system as well as other auxiliary infrastructure works, creating conditions for investors to implement projects.

- Actively reforming administrative procedures: according to investors' assessment, the province's good implementation of administrative reforms is partly due to the drastic direction and synchronous implementation of departments and branches in the province on administrative procedure reform. Up to now, all eight districts, towns and cities have built a "one-stop-shop" mechanism; most departments and branches of Ba Ria - Vung Tau have established departments to receive and return results of dossiers according to the one-stop-shop mechanism. At the Department of Planning and Investment, most of the regulations on procedures and order of investment project implementation are publicly posted. In addition, on the website of the Department of Planning and Investment of Ba Ria - Vung Tau, documents related to investment procedures and order are also clearly announced, all questions and recommendations are guided and specified with specific time limits for resolution.

- Strengthening, promoting, introducing: aware of the importance of domestic and foreign investment capital for the socio-economic development of the locality, every year, Ba Ria - Vung Tau province develops a plan to promote, introduce, and strengthen investment promotion. In major programs and events, investment attraction activities are always integrated. In major local festivals and cultural events such as: cultural-tourism festival, kite festival, cuisine, etc., investment promotion activities, awarding certificates, and introducing priority areas to attract investment are all associated with these activities. Annual local activities, in addition to exchanging and creating bridges between businesses, are also an opportunity for the locality to promote and introduce its potential strengths, attracting domestic and foreign investors.

Currently, the Department of Planning and Investment of Ba Ria - Vung Tau is working with relevant departments and branches to develop a set of criteria for selecting investors for the Provincial People's Committee. In addition to mandatory criteria such as investment rate, financial capacity, operating experience, etc., a series of "incentive" criteria such as: using local labor, building housing for workers, etc. will also be included in the general criteria of the province.

- Tourism investment promotion: the province has successfully built and exploited a tourism website about Ba Ria - Vung Tau, organized surveys with Ba Ria - Vung Tau radio and television to build tourism programs to introduce on local and central radio and television.

Since the beginning of 2006, in parallel with the regular introduction of tourism potential and products on the media, the tourism service program has been prepared quite carefully by the sectors and enterprises in the province with many diverse and impressive contents. If the first Sea Festival was held in 2006 as a benchmark, up to now, the province has organized at least one event each year, in which the regular event is the opening of the cultural-tourism festival associated with the cannon firing ceremony. In 2008, there was also the World Youth Chess Championship, gathering more than 900 athletes from 72 countries and territories to participate, which was successfully organized, showing the ability to organize large national and international events of Ba Ria - Vung Tau. In 2009, the province also held two larger activities: the 2009 Cultural-Tourism Festival, the Vung Tau International Kite Festival and the International Women's Beach Volleyball Tournament. In 2010, the province successfully organized the World Food Festival.

In particular, the Vung Tau International Kite Festival held at the end of March 2008 and the Miss Vietnam (September 2009) and World (November 2009) contests, and the World Food Festival 2010 are major events, attracting tens of thousands of domestic and international tourists. In addition, the province is also active in promoting the image and tourism of Vung Tau city, introducing the potential and direction of tourism development in the coming time.

2.2.1.2. Results of attracting investment in the tourism industry:

The situation of attracting investment projects in the tourism industry in recent years has had very encouraging developments. The number of investment projects has increased continuously over the years as shown in the following table:

Table 2.3. Number of investment projects in tourism in Ba Ria Vung Tau province in the period 2006-2010