Nâng cao cạnh tranh cụm ngành du lịch ở tỉnh An Giang

ABSTRACTThis thesis studies the competitiveness of the tourism sector in An Giang province, using thecluster approach. The thesis applies an adjusted Michael E.Porter model to evaluate thecompetitiveness of the tourism cluster in An Giang and finds that even though An Giangprovince attracts a large number of tourists every year, revenue from the tourism sector isrelatively small compared to its competitors, and the activities in the cluster target the low-endmarket segment. Moreover, spiritual tourism in An Giang province does not demonstratemuch growth potential. The tourism sector in An Giang province is duplicating the offeringsof other destinations and does not have clear competitive advantages. Therefore, the thesisrecommends that the government should not invest heavily in promoting spiritual tourism butshould improve the business environment by enhanced infrastructure, education andpromotional campaigns. The thesis also suggests that the province should shift its focus fromspiritual tourism to heritage tourism.

CERTIFICATION

I certify that the research has not been submitted for any degrees I certify that, to the best of

my knowledge, I have acknowledged all sources of information and support The study does not necessarily reflect the views of the University of Economics Ho Chi Minh City or the Fulbright Economics Teaching Program

Author

Hoang Tu Uyen

ABSTRACT

This thesis studies the competitiveness of the tourism sector in An Giang province, using the cluster approach The thesis applies an adjusted Michael E.Porter model to evaluate the competitiveness of the tourism cluster in An Giang and finds that even though An Giang province attracts a large number of tourists every year, revenue from the tourism sector is relatively small compared to its competitors, and the activities in the cluster target the low-end market segment Moreover, spiritual tourism in An Giang province does not demonstrate much growth potential The tourism sector in An Giang province is duplicating the offerings

of other destinations and does not have clear competitive advantages Therefore, the thesis recommends that the government should not invest heavily in promoting spiritual tourism but should improve the business environment by enhanced infrastructure, education and

promotional campaigns The thesis also suggests that the province should shift its focus from spiritual tourism to heritage tourism

Key words: tourism sector, cluster, spiritual, heritage

CONTENTS

CERTIFICATION i

ACKNOWLEDGEMENT ii

ABSTRACT iii

ABBREVIATIONS vi

LIST OF TABLES vii

LIST OF CHARTS viii

LIST OF FIGURES ix

1 INTRODUCTION 1

1.1 Background of the problem 1

1.1.1 Clusters & the competitiveness of clusters 1

1.1.2 The Tourism cluster in An Giang 7

1.2 Research Objectives 8

1.3 Research Questions 8

1.4 Organization of the Research 9

2 METHODOLOGY 10

2.1 Research methods 10

2.2 Research models 10

3 FINDINGS 11

3.1 An Giang as a gateway to the Mekong Delta 11

3.2 The performance of the current tourism cluster 14

3.3 Determinants of regional competitiveness in tourism 21

3.3.1 Given local nature endowment 22

3.3.2 Competitiveness at the regional level 25

3.3.3 Competitiveness at the firms level 32

3.4 The diamond model of competitiveness 35

3.4.1 Factor conditions (input conditions) 36

3.4.2 Demand conditions 38

3.4.3 Related and supporting industries 40

3.4.4 Context for firm strategy and rivalry 41

4 DISCUSSION, CONCLUSIONS, RECOMMENDATIONS 43

4.1 Discussion 43

4.1.1 Summary of the current situation 43

4.1.2 Opportunities 44

4.1.3 Challenges 44

4.2 Recommendations 45

4.2.1 The choice of mutual development 45

4.2.2 Investment in infrastructure 46

4.2.3 Consideration of the proposed An Giang airport 46

4.2.4 Investment in education 47

4.2.5 Creation of tourism business associations 47

4.2.6 Creation of heritage tours 48

4.2.7 Less investment on spiritual tourism projects 48

4.2.8 Promotional campaigns 48

4.3 Conclusions 50

REFERENCES 51

APPENDICES 56

ABBREVIATIONS

2009 Census 2009 Population and Housing Census

AGPC People Committee of An Giang province

AGU An Giang University

An Giang An Giang province

ATIPC An Giang Trade and Investment Promotion Center FDI Foreign Direct Investment

GSO General Statistics Office

HCMC Ho Chi Minh City

ICAO International Civil Aviation Organization

MDTA Mekong Delta Tourism Association

PCI Provincial Competitiveness Index

SME Small and medium size enterprise

LIST OF TABLES

Table 1.1: South Carolina industries’ dependence on tourism 6

Table 3.1: Tourism destinations in An Giang (listed by district) 16

Table 3.2: Airports in the Mekong Delta 30

Table 3.3: Structure of An Giang’s enterprises (2004 – 2009) 33

Table 3.4: Structure of An Giang’s enterprises (divided by size of capital and number of employees) (2004 – 2009) 34

LIST OF CHARTS

Chart 3.1: An Giang’s demographic structure in 2010 12

Chart 3.2: Total retail sales of goods and services – current prices (1995 – 2010) 12

Chart 3.3: Composition of An Giang’s economy from 2000 to 2010 13

Chart 3.4: Number of tourists served by the hotels in An Giang (2001 – 2010) 18

Chart 3.5: Structure of domestic tourism in 2009 18

Chart 3.6: Average expenditures per day of domestic tourists in 2009 19

Chart 3.7: Tourists’ average daily expenditures in An Giang from 2000 to 2010 19

Chart 3.8: Number of tourists served by the accommodation units and length of stay 20

Chart 3.9: Revenue from tourism activities (2009 – 2011) 20

Chart 3.10: Revenue per tourist in 2011 21

Chart 3.11: GDP per capita (constant prices) of An Giang, Can Tho, Kien Giang, Tien Giang and Tay Ninh from 2000 - 2010 24

Chart 3.12: Volume of passengers in An Giang, Can Tho and Tay Ninh (2001 – 2010) 25

Chart 3.13: Percentage of drop – out students from 5 to 18 years old in 2009 26

Chart 3.14: Proportion of development investment expenditure of An Giang from 2000 – 2010 28

Chart 3.15: PCI of An Giang province in 2010 and 2011 33

Chart 3.16: Revenue of the enterprises in tourism sector in An Giang (2001 – 2010) 37

Chart 3.17: Increase of foreign tourists from 1996 – 2011 39

LIST OF FIGURES

Figure 1.1: Determinants of regional competitiveness 3

Figure 1.2: Diamond model of competitiveness 4

Figure 1.3: Cluster development ladder 6

Figure 3.2: Map of the transport network from An Giang to larger Mekong Delta 13

Figure 3.3: An Giang tourism’s cluster map 15

Figure 3.4: Determinants of regional competitiveness in tourism in An Giang 22

Figure 3.5: Distances from An Giang and Tay Ninh to HCMC and Phnom Penh 22

Figure 3.6: Percentage of high school graduates 26

Figure 3.7: Locations of An Giang, Can Tho, Ca Mau, Rach Gia and Phu Quoc airports 29

Figure 3.8:Location of industrial zones and tourist sites in An Giang province 32

Figure 3.9: Diamond model of competitiveness in An Giang 36

Figure 4.1: Promotional campaigns targeting at tourists 49

1 INTRODUCTION

1.1 Background of the problem

1.1.1 Clusters & the competitiveness of clusters

Clusters as a new economic concept

“Cluster” is an emerging term in today’s economics Michael E Porter (1998) claims that clusters have a prominent role in maintaining the competitiveness of nations He defines a cluster as a “geographic concentration of interconnected companies and institutions in a particular field,” which includes suppliers of specific inputs, providers of specialized

infrastructure, manufacturers of complementary products and companies in related industries (Porter 1998, 199) He also states that when the companies and institutions get together in clusters, their whole value is greater than the sum of each separate part, and “clusters, broader than industries, capture important linkages, complementarities, and spillovers of technology, skills, information, marketing, and customer needs that cut across firms and industries” (Porter 1998, 205)

Clusters promote both competition and cooperation (Porter 1998) Clusters will affect

productivity growth, with “productivity” defined as “the value created per day of work and unit of capital or physical resources employed” (Porter 1998, 209) Porter states that clusters are of foremost importance since they provide better access to employees, suppliers,

specialized information, complementarities, institutions and public goods Clusters also encourage improved measurement and motivation Besides, clusters also help drive the direction and pace of innovation as well as stimulate the formation of new businesses (Porter 1998) Ferreira and Estevão (2009) believe that clusters generate static externalities (cheaper access to product factors) and dynamic externalities (enhanced learning and motivation)

The tourism cluster

Tourism has recently been considered an “economic growth engine with particular focus at

the regional level” (Ferreira and Estevão 2009, 1) Botti et al (2008) prove that the industry is

a prodigious source of value creation and employment, especially in places with no other alternative economic advantages

Ferreira and Estevão (2009, 5) define the tourism cluster as a “geographic concentration of companies and institutions interconnected in tourism activities” Generally, tourism clusters are associated with tourism products and destinations

Tourism achieves positive economic outcomes through clustering (Roberts 2000) The industry is extremely suitable to the application of the cluster concept because the satisfaction

of the customers (tourists) comes from both the attraction of the destination and the quality of related businesses such as hotels, restaurants, shopping centers and transportation (Ferreira and Estevão 2009) Nordin (2003) observes that the experience of tourists is based on the overall impression of the destination visited, and every single factor needs systematic

development

In general, destinations like clusters are formed naturally However, to achieve their full potential, they need support (Nordin 2003) Braun (2005) says that tourism clusters’ growth needs a critical mass of firms and also the important elements of strategic infrastructure such

as hard, financial and human resource infrastructure

The competitiveness of tourism clusters

Dominguez (2001, as cited in Ferreira and Estevão 2009, 9) states that the competitiveness of

a tourism cluster depends on the tourism businesses’ capacity to attract visitors who “offset the costs of business development, and reward the capital invested, in an equal or above manner of the opportunity cost.” Some elements of tourism cluster competitiveness are invisible and immeasurable (Dwyer and Kim 2003) Objectively measured elements of the competitiveness of a tourism destination (tourism cluster) are visitor numbers, market share, tourist expenditure, employment and value added by the tourism industry, and the

subjectively measured ones are “richness of culture and heritage” and “quality of tourism experience” (Dwyer and Kim 2003, 375) There are models that can be applied to measure the competitiveness of a destination and a specific cluster

Determinants of regional competitiveness

Adjusting Porter’s framework to a regional scale to analyze national competitiveness, Vu

Thanh Tu Anh et al (2011) mention three factors that affect the productivity of a region,

namely: (i) regional natural endowments; (ii) competitiveness at the regional level; and, (iii) competitiveness at the firm level

Source: Porter, E (1990), adjusted by Vu Thanh Tu Anh et al (2011)

Natural endowments refer to the factors naturally owned by the regions such as natural resources, geographic position and scale of the local economy It is not always true that favorable natural endowments will lead to a high degree of competitiveness of a region and

vice versa (Vu Thanh Tu Anh et al 2011) Facing pressure from unfavorable conditions, such

as lacking natural resources or having an adverse climate, necessary strategies and innovation will be generated, thus enhancing competitiveness For example, Japan and Korea have proved that countries can create and maintain high competitiveness without the support of natural resources, while many countries blessed by nature such as Nigeria and many other African countries seem to suffer from the “curse of natural resources” (Sach and Warener 1995)

Competitiveness at the regional level includes the infrastructure of culture, society, health and education, which is usually called “soft infrastructure,” together with fiscal and credit policies and the economic structure of the region The last determinant of regional competitiveness refers to competitiveness at the firm level This determinant includes the business

environment and infrastructure, the capacity of the clusters and the strategies and business

practices in the region

Business

environment &

infrastructure

Cultural, social, medical & education infrastructure

Fiscal, credit policies &

Economic structure

Business’s practice

& strategies

Cluster development

Geographic position

Scale of regional economy Natural resources

Competitiveness at the firm level

Competitiveness at the regional level

Given local natural endowments Figure 1.1: Determinants of regional competitiveness

A local context that encourages investment and sustained upgrading, e.g intellectual property protection Open vigorous competition among local based rival

A core of sophisticated and demanding local customer(s) Unusual local demand in specialized segments that can

be served nationally or globally

Customer needs that anticipate those elsewhere

High quality, specialized inputs

Rivalry

Related &

Supporting Industries

Factor conditions

Demand conditions Government

Availability of capable, locally based suppliers and firms in related industry Presence of clusters instead

of isolated industry

Diamond model of competitiveness

Porter (1990) believes that the success of every company that competes in the market comes from the economic environment, institutions and government’s policies He also emphasizes that the main indicator of competitiveness is productivity He proposes a framework of competitive performance, depicted as a “diamond model”, consisting of (i) factor conditions; (ii) firm strategy, structure and rivalry; (iii) demand conditions; and (iv) related and

supporting industries Porter later adds (v) government and (vi) change/chance as “events out

of control of the company”

Source: Porter, E (1990)

Figure 1.2: Diamond model of competitiveness

The first facet of the model is about factor conditions, which Porter and many other authors place much emphasis on Factor conditions are also called “input conditions” – or raw

materials In tourism, factor conditions play such an important role that Nordin (2003) even claims that without these conditions, there would be no tourism activity Factor conditions are usually classified as “basic production factors” such as land, labor, capital, natural and

cultural resources and “specialized factors” (Nordin 2003, 21) Among these, specialized factors – things that are not inherited but created – are vital to competitiveness The

specialized factors of the tourism industry include human resources trained in tourism,

infrastructure to access natural resources, capital markets to finance long-term tourism

projects and wide coverage of public services (Inman 2002 – as cited in Nordin 2003)

Demand conditions refer to the needs and wants of consumers Local demand is very

important since the proximity of companies to their customers increases their responsiveness and shortens communication channels (Nordin, 2003) Nordin (2003) also states that both domestic and foreign visitors contribute to local demand of tourism Porter (1998) believes that the sophistication of consumers is crucial Smeral (1998) says that sophisticated tourists’ needs require recognizing new trends and new production possibilities early on Therefore, anticipating consumers’ wants are vital to developing tourism activities

Porter (1990) insists that in an intensively competitive environment among local companies, the pressure to innovate and constantly improve is created Therefore, long-term competition should be considered as a driver of innovation In the tourism industry, destinations compete

in terms of services, prestige and market share (Nordin, 2003), and it is not surprising that the high degree of rivalry may lead to improved standards and new products

Nordin (2003) concludes that the competitiveness of a destination is defined by “the degree of specialization, by its diversity, the quality of suppliers and operating network” (Nordin 2003, 23) The term “related and supporting industry” is related to the development of all factors in

a cluster There is no general agreement about the dependence of each single related industry depends on tourism, but Flowers and Easterling (2005) propose a grid, ranking industries by their dependence on tourism for the tourism cluster in South Carolina The grid can be more

or less applied to other tourism clusters

Table 1.1: South Carolina industries’ dependence on tourism

Source: Flowers and Easterling (2005)

In the grid, Flowers and Eastering (2005) conclude that tourism has the strongest effect on the hotel industry Some other industries such as restaurants, recreation and auto services also significantly depend on tourism Their dependence is about 50 percent In addition, tourism also affects other economic activities to a smaller extent

Cluster development ladder

McRae – William (2002) explains that clusters progress through a ladder in which the later stages achieve better performance than earlier ones, and working clusters are the ones with the highest competitiveness They have the critical mass, geographic concentration and active clustering processes

Figure 1.3: Cluster development ladder

Source: McRae – William (2004)

In her paper, McRae – William (2002) describes a “wannabe” cluster as a so-called cluster that “lacks too many vital economic attributes to benefit from being a cluster” (McRae - William 2002, 240), while a “working” cluster shows many favorable characteristics of clustering and high level of interconnection In the middle, “latent” and “potential” clusters have critical mass and geographic concentration but without active clustering processes

Dwyer and Kim (2003) provide a list of groups of determinants and indicators of a

destination’s competitiveness The model provides a more detailed description of the factors affecting the competitiveness of a tourism destination Therefore, the ideas of Dwyer and Kim have been employed as a useful benchmark for evaluating the competitiveness of the tourism cluster in An Giang

1.1.2 The Tourism cluster in An Giang

An Giang welcomes a large number of visitors every year According to official records, the total number of visitors was more than 5.5 million in 2011, and eighty-seven percent of tourists who visited An Giang in 2010 were Vietnamese (Mekong Delta Tourism Association

- MTDA 2012) Tourism activities in An Giang basically depend on spiritual tourism, with the center as Ba Chua Xu festival, lasting for four months, from the first to the fifth month of the lunar year Each year, the festival hosts more than three million visitors, accounting for about 70 percent of the total number of tourists to An Giang every year, according to Huynh Thi Nhu Lam, chair of Tourism, An Giang’s Department of Culture, Sports and Tourism The seasonal peak of tourism activities in An Giang is between the first and the fifth month of the lunar new year because of the density of the religious festivals during this period of time During the peak season, about 70 to 80 percent of tourists visit the province

Typically, the tourism cluster in An Giang attracts the following types of visitors:

• Pilgrims who visit the destination every year to worship during the Ba Chua Xu

festival and some other religious festivals such as the ceremony at Thoai Ngoc Hau tomb They may also be involved in other activities such as shopping in the duty free zone and shopping centers nearby or visiting pagodas and other religious places These visitors typically stay for a short while and do not use many tourism services The majority of this type of tourist is from the nearby provinces, but there is an increasing trend of pilgrims from the northern provinces

• Heritage tourists are mostly foreign tourists, but there are also domestic heritage

tourists They visit the cultural sites such as the Cham and Khmer villages, Oc Eo relic, ox-racing festivals and boat house villages These tourists usually use more tourism services than the pilgrims The number of this type of tourists is quite limited

• Sightseeing tourists consist of both domestic and foreign tourists Domestic

sightseeing tourists mostly come from nearby provinces and they only have picnics Some of the well-known tourism sites are Tra Su Cajuput Forest, Ton Duc Thang Monument, Cam Mountain Entertainment Park, Sap Mountain Entertainment Park and some other theme parks

The provincial government has shown an interest in developing tourism as one of the core economic activities besides manufacturing and processing Decision 803/QĐ-BVHTTDL of the Ministry of Culture, Sports and Tourism in 2010 also claims An Giang, Kien Giang and

Ca Mau as the central group to develop tourism activities in the Mekong Delta In reality, revenue from hotels and restaurants (the main proportion of revenue from tourism) accounted for about 10 percent of budget revenue (VND 1,628 billion in constant prices) in 2010, an increase from 2000 of five percent (VND 345 billion in constant prices) Local government also wants to improve the performance of tourism and make the province the tourism hub in the region However, the results thus far have fallen short of expectations In 2011, even though the number of tourists to An Giang made up 32 percent of the total number in the Mekong Delta, revenue from the tourism sector in An Giang accounted for only seven percent

of the Delta’s total revenue from tourism (MDTA 2012) Also, spending and the average length of stay among domestic and international tourists are quite limited It seems like all of the efforts to turn tourism into a flagship of An Giang’s economy have not achieved their goals, thus raising questions about this region’s tourism competitiveness and potential for further development

1.2 Research Objectives

The research evaluates the role of tourism in An Giang’s social and economic development

By applying an adjusted Porter model, the author evaluates the competitiveness of the tourism cluster and introduces the necessary actions to be taken to enhance the cluster’s performance

1.3 Research Questions

The research will answer the following questions:

- How is the competitiveness of An Giang’s tourism sector?

- What are the strengths and weaknesses of An Giang’s tourism cluster?

- What policy changes are needed to enhance the competitiveness of the tourism cluster

in An Giang?

1.4 Organization of the Research

The research consists of four chapters The first chapter provides the foundations for the research, including the background, literature review, research objectives and research questions The second chapter sets out the methodology of the research, including the process

of gathering and analyzing data The third chapter discusses the findings of the research Tables and charts are used to support the main conclusions In the last chapter, the author discusses the findings from the previous chapters, answers the research questions and

provides recommendations to enhance the competitiveness of the tourism cluster in An Giang

2 METHODOLOGY

2.1 Research methods

The author has employed qualitative research methods in this research First, the secondary data are collected The author analysed the collected data to figure out the main problems and built an interview list to dicuss with the experts After the discussions, the author conducted in-depth analyses and generate the main findings of the thesis A list of the interviews can be found in the appendices

Secondary data were collected from the Statistical Year Books of the General Statistics Office (GSO), An Giang province’s People Committee (AGPC), the Mekong Delta Tourism

Association (MDTA) and other research Also, another important source of data was from the

research of Vu Thanh Tu Anh et al (2011) of the Fulbright Economics Teaching Program

about the competitiveness of the provinces in the Mekong Delta This information will be organized using the method proposed by Michael E.Porter

All data were processed in excel files and presented in the form of tables, charts and graphs

2.2 Research models

The research is conducted mostly based on the ideas about the determinants of national

competitiveness from Professor Michael E Porter, adapted by Vu Thanh Tu Anh et al (2011)

to a regional scale The model mentions three groups of factors affecting the competitiveness

of a region, including (i) regional natural endowments – geographical features, climate

conditions and scale of local economy; (ii) competitiveness at the regional level refers to the

so called “macro” economic conditions in a region, such as infrastructure, culture, society value, health, education and local government policies; and, (iii) competitiveness at the firm level, relating to the business environment, technical infrastructure (soft infrastructure), and the development of clusters and firms’ strategies

Also, the author will introduce the competitiveness of the tourism cluster in An Giang through the diamond model (Porter, 1990), which mentions four facets of an industry’s

competitiveness: (i) factor conditions; (ii) demand conditions; (iii) firm strategy, structure and rivalry; and, (iv) related and supporting industries

3 FINDINGS

The findings are based on the information from data collected and interviews, and are

presented in narrative form and in tables, charts and pictures to reveal the competitiveness of tourism sector in An Giang by a cluster approach The main benchmarks are tourism sectors

in other provinces that share many things in common with the tourism sector in An Giang, including Tay Ninh province, Can Tho city and some other provinces in the Mekong Delta Also, the development of the tourism cluster in An Giang over different periods of time is also taken into consideration A detailed list of determinants and indicators of the competitiveness

of tourism destination as suggested by Dwyer and Kim (2003) is also considered

3.1 An Giang as a gateway to the Mekong Delta

Demographic features

An Giang is located in the upper reaches of the Mekong Delta, southern Vietnam It shares a

100 - km border with Cambodia Also, An Giang borders Dong Thap, Kien Giang provinces and Can Tho City Similar to other regions in the delta, An Giang has a fairly flat topography with a criss – crossed river system Besides the midland area, the province also has a low mountain system, called Bay Nui – That Son (Seven Mountains) which is located in Tinh Bien and Tri Ton districts The province is home to many ethnic groups Additionally, it has a large number of pagodas, temples and other religious places The province is divided into one city, two towns and 8 districts

With a population of around 2.2 million people (2010) living in 3,536 square kilometers, An Giang is among the most crowded provinces in Vietnam, and 30 percent of its population lives in urban areas (2009 Census) The population of the province comprised 12 percent of the total population of the Mekong Delta in 2009 (2009 Census), and the population density is about 608 people per square kilometer, which is much higher than the average population density of the Mekong Delta (246 people per square kilometer) (Statistical Year Book of Vietnam 2010) Educational attainment in the province is relatively low, compared to national standards In 2010, the number of high school graduates was 43/1,000 people

Chart 3.1: An Giang’s demo

Source: Statistical Year Book of An

An Giang has the highest buyi

sales in An Giang totaled abou

services of An Giang in 2010 w

GDP (1994 prices) in 2010 wa

cities in the region The GDP p

Source: Statistical Year Book of Viet

150000

Female Male

2010)

The largest source of the region’s wealth is from the services and trade sectors, which make

up more than half of total GDP Agriculture is second with 33 percent and industry has

accounted for only 10 percent for more than a decade The contribution of different sectors to regional wealth has changed slightly in the last 10 years, as agriculture has declined relative to trade and services while industry remains unchanged over time

Chart 3.3: Composition of An Giang’s economy from 2000 to 2010

An Giang is more than 200 kilometers away from the biggest economic and political center,

Ho Chi Minh City, and it takes approximately four to six hours to travel between the two places, due to the poor infrastructure and the need to cross the Tien River by ferry Vam Cong Bridge, the bridge to connect An Giang and the northern part of the Mekong Delta, should be built by 2013 following a loan agreement signed between Vietnam and South Korea in 2011 The value of the loan, provided by the Export – Import Bank of Korea, is USD 200 million The bridge will take the place of the Vam Cong ferry station and will significantly shorten the

time to travel from HCMC to An Giang and vice versa, especially during the peak tourism season when there are constant traffic jams at the Vam Cong ferry station

Additionally, Long Xuyen city of An Giang is more than 60 kilometers from Can Tho City, the center of the Mekong Delta, but the roads connecting the two destinations are in such poor condition that it usually takes about two or more hours to travel to and fro It is a two-lane road with almost no street – lighting in some areas, and the last buses between the two places

usually leave before six o’clock in the evening

3.2 The performance of the current tourism cluster

The current tourism cluster is illustrated in the following cluster map Spiritual tourism is the core activity The competitiveness of each factor in the cluster map is evaluated based on the performance of the factors in comparison with that of their main competitors including the nearby provinces in the Mekong Delta and Tay Ninh province Some factors such as hotels, restaurants and souvenirs are measured based on generally accepted standards using available secondary data Educational attainment is evaluated against national standards and indices

Figure 3.2: An Giang tourism’s cluster map

Duty free zone/

border markets

Ba Chua Xu temple and other religious places

Heritage tourist sites

An Giang’s tourism cluster is mostly based on the religious tourism, with the most successful tourist attraction being Ba Chua Xu Temple and its festival, lasting from after the lunar new year to the fifth month of the lunar year Ba Chua Xu Temple is where people come to join religious ceremonies with the belief that they will bring prosperity to the visitors and success

to their businesses This is a competitive advantage that few other tourism destinations in Vietnam can match Basically, the tourism cluster in An Giang heavily depends on the

success of the Ba Chua Xu festival, thanks to its contribution in terms of the volume and expenditures of visitors, its prestige and unique qualities The other activities such as

shopping and sight-seeing have been built supporting this core activity

In addition, tourists who visit An Giang may visit some other well-known places such as Cam Mountain’s Entertainment Park, President Ton Duc Thang’s monument and Tuc Dup Hills More detailed descriptions of the tourism sites in An Giang are shown in Table 3.1

Table 3.1: Tourism destinations in An Giang (listed by district)

No Tourism activities / places District/town Type of tourists

Religious Tourists

Heritage tourists

Sight - seeing tourists

1 Khanh Binh national border

3 Thoai Ngoc Hau temple Chau Doc x

6 Ton Duc Thang’s

monument

10 System of pagodas and

Buddha statues on Cam

12 Tinh Bien Market Tinh Bien x x

13 Tinh Bien international

border gate

17 Khmer pagodas Tinh Bien,

An Giang has a stable number of visitors every year During the last 10 years, the destination has seen an increasing trend in tourist volumes According to records about tourists who have used accommodation services in the province, the number has rocketed up from 250 thousand

to more than 300 thousand by 2007 and remained at around 300 to 400 thousand tourists per year (AGPC 2011) The proportion of domestic tourists is always much larger than foreign tourists even though the numbers of foreigners has increased slightly During the peak season,

An Giang experiences transportation problems such as traffic jams in many places such as Vam Cong Ferry and National Road 91 and an increase in traffic accidents On average, it takes more than 20 minutes to cross the Tien river during high tourism season

It is obvious that An Giang is among the provinces that attracts the most tourists in the

Mekong Delta Some other notable destinations in the region are Kien Giang, Tien Giang and Can Tho Tien Giang benefits from its location as a neighboring province to HCMC, and a large number of tourists from the city can easily visit the orchards and beaches of Tien Giang

on day-long tours Can Tho is well-known for being the center of the Mekong Delta and the famous floating boat markets Kien Giang focuses on the beautiful beaches and luxury resorts

of Phu Quoc island On a larger scale, Tay Ninh province’s tourism sector is another religious tourism destination and shares many things in common with An Giang Tay Ninh province is also a mountainous region which borders Cambodia and is also the home of the Cao Dai, one

of the major religions in Vietnam with about three million followers

Chart 3.4: Number of tourists served by the hotels in An Giang (2001 – 2010)

Source: AGPC (2011)

Although it attracts a large (and also stable) number of visitors every year, the cluster has failed to attract tour operators There are a limited number of tours to the destination and the majority of visitors to An Giang make their own arrangements without booking a tour (and possibly without early reservation of other services) The statistics from the survey “tourism expenditure survey in 2009” (GSO, 2010) show that only 0.7 percent of the domestic tourists who went to An Giang joined tours Recently, some operators have started to provide tours to visit the famous religious sites and festivals in An Giang, but there are not many options for tourists because the tours focus heavily on spiritual activities

Source: Tourism expenditure survey in 2009 – GSO (2010)

Chart 3.5: Structure of domestic tourism in 2009

According to the Tourism Exp

An Giang are relatively low co

or Can Tho Expenditures of to

less than half of those in Can T

expenditures of international t

in An Giang is also considered

Source: Tourism expenditure survey

Statistics show that expenditur

have not changed much since

2001 prices Surprisingly, expe

tourists, and expenditures in ge

Tourism Expenditure Survey i

but it remains a fact that expen

economy is far behind the othe

Source: AGPC (2011)

1072.8

0 200

Chart 3.6: Average expendit

Chart 3.7: Tourists’ average

xpenditure Survey in 2009, expenditures of domescompared to that of other destinations such as Tay

f tourists in An Giang are about one third of those

n Tho In the data, there are no records of average

l tourists at specific destinations, but spending of f

ed low, compared to the average

ey in 2009 – GSO (2010)

tures of tourists in An Giang, both domestic and in

e 2000 The spending of tourists has even declinedpenditures of foreign tourists are lower than those general are also much lower than the number clai

y in 2009 It is possible that some spending has noenditures or the contribution of each tourist to Anther destinations

itures per day of domestic tourists in 2009

ge daily expenditures in An Giang from 2000 to

n Giang’s

nations

tourists (current price) tic tourists (current price) tourists (2001 prices) tic tourists (2001 prices)

to 2010

This may due to the fact that m

places (for example, to attend

willing to spend much on loca

stay is only slightly more than

spend less than a day in the pro

Source: AGPC (2011)

According to the records of the

the 13 provinces in the Mekon

Also, the revenue per tourist o

Source: MDTA (2012)

50,000 100,000

Chart 3.8: Number of touris

Chart 3.9: Revenue from to

many of the tourists, especially tourists who visit

d the Ba Chua Xu festival or to worship at the pagcal services Records from hotels show that the av

an one day (1.05 day) per guest, while a larger numprovince (AGPC 2011)

the MDTA, revenue per tourist in An Giang is theong Delta even though the volume of tourists is on

t of An Giang has not changed much over the last

002 2003 2004 2005 2006 2007 2008 2009 2010

Year

Total d Total d Numb

Year

Can Tho City Kien Giang Tien Giang

length of stay

Source: MDTA (2012)

Recently, An Giang’s reputation as a safe and peaceful destination has suffered because of criminality directed at tourists Such conditions will weaken the competitiveness of the tourism cluster here in two ways First, it may discourage new visitors from coming Second, for people who have been to the destination and who want to return, they might choose to be more careful or even refuse to use the local services if possible

Safety issues have also been raised recently especially after a landslide in Cam Mountain, one

of the main tourist sites in An Giang province, killed at least six people, including five

pilgrims, in early May 2012

In the following parts of this chapter, the competitiveness of the tourism cluster in An Giang province will be discussed in more detail, including an analysis of the determinants of

regional competitiveness and the competitiveness of the tourism cluster based on aspects of the diamond model

3.3 Determinants of regional competitiveness in tourism

The determinants of regional competitiveness are grouped in three different classes, namely: (i) regional natural endowments; (ii) competitiveness at the regional level; and, (iii)

competitiveness at the firm level

0.04 0.08 0.09 0.15 0.22 0.24 0.25 0.30

0.49 0.52

0.75 0.78 0.88

of regional competitiveness in tourism in An G

re endowment

An Giang and Tay Ninh to HCMC and Phnom

he competitiveness at firms’ level

Business’s practic

& strategies

Geographic position

Scale of regional economy

ial &

n ure

Fiscal policies &

Economic structure

Cluster development

competitiveness at regional level

Given local endowments

Giang

om Penh

tice

al

Geographic position & natural resources

An Giang has a low mountain system in a flat area, river and canal system, a border with Cambodia and a pleasant tropical climate However, located in the far western part of the Mekong Delta, An Giang is separated from the most influential economic and social center of the South Vietnam – HCMC As the majority of tourists to the southern part of Vietnam arrive

in HCMC before going on to other destinations, the problem becomes much more serious Usually, it takes about four to six hours to travel from HCMC to An Giang, but at peak times,

it takes much longer because of the high traffic density on National Road 91 - 80 and the traffic jams at Vam Cong Bridge The HCMC – Trung Luong highway, which is 61

kilometers long, reduces the journey time but does not solve the problem Compared to neighbors such as Long An, Can Tho, Dong Thap or Tien Giang, An Giang has the most unfavorable location Tay Ninh province is very close to HCMC Tourists only need one hour

or so to travel from HCMC to Tay Ninh Such problems increase the costs of transportation and time

In addition, tourists who want to visit Cambodia after finishing their trip in Vietnam usually choose to travel via Moc Bai international border gate in Tay Ninh rather than going through the Khanh Binh international border gate and some others in An Giang because it takes less time to travel from Tay Ninh to the Phnom Penh, the capital city of Cambodia, since the roads connecting the two places are also wider and smoother

Located on the upper banks of the Cuu Long River (part of the Mekong River), An Giang experiences a flood season, starting from the seventh month of the Lunar new year (usually August on the Gregorian calendar) It is the time for many community activities and festivals, such as boat racing, ox racing and Dolta (new year festival of the Khmer)

Scale of the regional economy

An Giang’s population is about 2.2 million people, which is double Tay Ninh’s population, and it is the most densely populated province in the Mekong Delta The population density in the province in 2010 was 608 people per square kilometer, which is much higher than the average for the Mekong Delta (246 people) Such a large population creates a sizeable

domestic market for services such as transportation, food and distribution services According

to records of the Statistics Office of Can Tho city, released in 2011, An Giang’s GDP per

capita in 2010 was USD 770, and that of the Mekong Delta and the nation as a whole were USD 847 and USD 574, respectively However, the growth of An Giang’s GDP per capita is markedly slower than the other provinces of the Mekong Delta The last ten years’ statistics show that even though An Giang had higher starting point, its GDP per capita in 2010 was lower than that of Can Tho city and Kien Giang province

Chart 3.11: GDP per capita (constant prices) of An Giang, Can Tho, Kien Giang, Tien Giang and Tay Ninh from 2000 - 2010

Source: People Committee of the provinces (2011), GDP per capita of Can Tho (from 2000 to 2005) includes GDP per capita of Can Tho city and Hau Giang province

The system of providers of transportation services between An Giang and HCMC is among the most developed in the region with at a wide range of service providers, including the largest transportation service providers such as Phuong Trang Company and Mai Linh

Corporation which offer standardized services Everyday there are about 80 round trips between HCMC and An Giang thanks to the large demand for transportation, and the volume

of passengers carried in 2010 was about 66.5 thousand Since 2009, all passenger

transportation activities have been organized by non-state companies The volume of

passengers carried is much larger than that of Tay Ninh province The transportation system within the province is good Bus systems have connected the populous places in the province

to some nearby provinces since 2005, and these routes have expanded over the last five years

An Giang

Source: Statistical Year Books of An Giang, Can Tho and Tay Ninh (2005, 2010)

Goods are transported either by land or by river In 2010, the volume of freight traffic in An Giang was about 19.5 thousand tons, of which 91.5 percent was moved via inland waterways The turnover of transportation and loading activities in An Giang in 2010 was about VND 2,068 million

3.3.2 Competitiveness at the regional level

Society’s soft infrastructure

According to the General Population and housing Census of 2009 (GSO 2011), more than 67 percent of An Giang’s population (about 1.5 million people) is of working age (from 15 to 60 years old), which also means that the province has a very young work force However, the education level in the province is relatively low, compared to the national average In

addition, An Giang is also among the provinces which have the highest level of drop-out students from 5 to 18 years old Many other provinces in the Mekong Delta are also at the top

of drop - out list such as Soc Trang, Bac Lieu and Ca Mau Tay Ninh also placed seventh in the list

Chart 3.12: Volume of passengers in An Giang, Can Tho and Tay Ninh (2001 – 2010)

Source: figure 4.6, 41, Education in Vietnam: An analysis of key indicators, GSO (2011)

An Giang is also located in the area which has the lowest percentage of high school graduates

In all provinces in the Mekong Delta (except for Can Tho city), less than 11 percent of the population has graduated from high school Such a low base of educational attainment

strongly affects regional human resources

Source: figure 5.5 (d), 50, Education in Vietnam: An analysis of key indicators, GSO (2011 )

Chart 3.13: Percentage of drop – out students from 5 to 18 years old in 2009

Figure 3.5: Percentage of high school graduates

The tourism industry requires skilled labor with specific training By 2010, the tourism sector

in the Mekong Delta employed some 17 thousand workers, of which only 6.3 percent had a bachelor degree in different fields (Bich Kien 2011) There were about 1,300 workers in the tourism sector in An Giang in 2008 (Bui Van Trinh and Nguyen Quoc Nghi 2010) In 2000,

An Giang University (AGU) was founded, based in Long Xuyen city The university has offered a tourism-related subject called “Vietnamese Studies” at the Faculty of Culture and Arts since 2007 Every year, about 50 Vietnamese studies students graduate from the

University However, Vietnamese studies provided by AGU do not focus on the necessary skills for people who work in the tourism sector Other vocational schools in An Giang do not have related training courses

The Department of Culture, Sports and Tourism of An Giang has organized various training courses to enhance skills for workers in the field The courses usually last from one to three months The department has held a total of 42 classes for about 2,000 participants, according

to Huynh Thi Nhu Lam The classes are to provide skills in hotel and restaurant management, customer care, sales and room services However, not all of the businesses in the tourism sector send their workers to the courses because it takes time and many workers change jobs after getting training, and the quality of the courses is still questioned

Facing the same problem of a lack of trained workers, the other destinations have taken steps

to resolve the problem Beginning in the academic year 2004 – 2005, Can Tho University founded a four year bachelor degree program for tour guides after its two year vocational training program in tourism Tay Ninh province, even though does not have a university itself, benefits from the more developed vocational training level from its neighbor, HCMC

However, the main problem of trained workers in tourism industry in An Giang and other nearby destinations comes mostly from the fact that incomes of people working in tourism industry in An Giang are quite low (Ly Chan An 2012) Therefore, trained people may move

to work in other destinations to obtain higher salaries, or qualified workers may not choose to work in the field in the first place Entrance examination marks of the Vietnam studies

students in AGU are relatively low, yet there are not enough qualified candidates

Although its educational attainment levels are quite low, An Giang has a rich cultural heritage with the presence of many different ethnic groups Each group brings a specific quality to the

region and enriches the land with their religions, festivals and traditions Many festivals held

in An Giang originate from the ethnic minority groups including ox- racing, Chol Chnam Thmay festival of the Khmer and the Roya Haji of the Cham The life and culture of the minority groups are suitable for heritage tourism However, an emerging problem concerns

the safety of tourists Crimes against tourists are increasing Recently, Vietnamnet, a popular

online newspaper, ran a series of articles about the misbehaviors of the local service providers towards tourists attending Ba Chua Xu festival

The local government’s policies toward tourism

The provincial government has targeted industry and services as the regional economic flagships and is committed to deploying its resources to develop the tourism sector However, the statistics on public investment do not clearly show the determination of the government From 2000 to 2010, total development investment by the local government was about VND 10,312 billion However, there was no specific figure relating to tourism and related

industries However, investment in infrastructure and education accounted for almost 40 percent of the total

Source: AGPC 2011

From 2006 to 2010, VND 97 billion was spent to develop the tourism sector, of which less than 30 percent was from the state budget according to Nhu Lam Actually, 17 projects have been launched with each project receiving VND 5.7 billion on average

Other public services Other development investment

Chart 3.14: Proportion of development investment expenditure of An Giang from 2000 – 2010

Infrastructure is emphasized in

(Decision No 308/QĐ – UBN

total Most infrastructure inves

the An Giang airport

The local government is very e

most well-known spiritual tour

centerpiece of the local govern

bring in high-end tourists to th

billion, and the first phase wou

3C airport (coded by the ICAO

Mekong Delta, the three others

airports are located close to ea

60 kilometers away from Can

Source: Duc Hien (2011), cited in H

The neighboring airports have

the airports are now working a

Can Tho airport, the center air

cover losses

Figure 3.6: Locations of An G

in the investment proposals for the period 2012 toND) Investment in infrastructure accounts for 75estment is for two main projects: the Cross-Asia

y excited about the idea of turning the province inurism destinations in the Mekong Delta The airprnment’s plans View as air taxi station, and the a the province The estimated project costs are abouould be completed in 2020 After that, An Giang O) This would also be the fourth airport in the mers being Can Tho, Ca Mau and Rach Gia airportseach other For example, An Giang airport would

n Tho and Rach Gia airports

Hung Anh (2011)

ve suffered losses since beginning operations Rec

g at about 10 to 30 percent of their current capacityairport of the Delta, has to spend billion VND ever

n Giang, Can Tho, Ca Mau, Rach Gia and Phu Qu

to 2015

75 percent of the Highway and

into one of the irport is the

e airport would out VND 4,000

g would possess a mainland of the

s Moreover, the

ld be only about

ecords show that ity (see table 3.2) very month to

uoc airports

Table 3.2: Airports in the Mekong Delta

Code

Investment (VND billion)

(USD 565 mil)

5 mill passengers 5.000 tons of goods

Source: data collected from Southern Airports Cooperation website (http://www.sac.vn) and newspapers

The government of An Giang is still very positive about the future of An Giang airport

because it believes many foreign tourists will arrive in An Giang from Phnom Penh and other places in Cambodia, and the airport would make it more comfortable for high-end tourists and businesspeople to arrive in An Giang, according to Vuong Binh Thanh, vice chairman of the

AGPC in an interview to CafeF (2011) However, the main source of passengers to An Giang

is from HCMC and it is about 200 kilometers to An Giang It would only take about three hours to travel between the two places by bus if the roads were upgraded, which is not much longer than the time required to fly (given security procedures, boarding times and so forth), and surely much higher fee In addition, An Giang airport, similar to the nearby airports, would only have very few flights every week, and would not achieve economies of scale Moreover, only small aircrafts can land in a 3C airport like An Giang airport; thus a very limited amount of goods can be carried there The airport would not develop the air cargo industry in a significant way

The local government says that it will call for investment into the airport from non-state sectors, but it does not sound very feasible because of the low profitability of the venture However, hundreds of hectares of cultivated land have been cleared and money is now being spent on building the road from Long Xuyen city to the airport

Besides the tourism sector, the province has also chosen industry as a driver of the regional economy Most of the industrial zones and groups are located close to the Tien River and border gates, and these are also close to many tourist sites In 2010, there were 24 industrial zones and industrial groups in An Giang province, located in all districts and Long Xuyen city, taking about 1,500 hectares, which were once land for rice, but the occupancy rate is very limited By 2009, the occupancy rate of the largest industrial zone in An Giang (Binh Hoa industrial zone) was seven percent, with three working projects and another five

suspended Local public spending for infrastructure for the Binh Long and Binh Hoa

industrial zones amounted to VND 271 billion by 2010 (Tam Phong 2011)

Box 3.2: Can Tho airport suffers losses

Can Tho airport suffers losses every month It is capable of serving 500 passengers at peak periods but since it began operation, there are only about 70 – 80 passengers at peak times There are now only two flights(from Can Tho) to Ha Noi everyday by Fokker instead of Airbus aircraft The airport has to cut flights to Phu Quoc island on Tuesday and Saturday Flights to Con Dao are on Monday, Wednesday and Friday by ATR – 72

Before the Lunar New Year, Can Tho airport had 30 flights to Taiwan, but these mostly to carry passengers from Taiwan, and the return flights were almost empty Sometimes, the hundred workers in the airport serve only 20 passengers

Pham Thuy Trang, vice director of Can Tho airport, cited in Thanh Nien Online (2011)