Đà Nẵng kickstarts economy after COVID-19 pandemic

May 26, 2020 - 09:32
The central city of Đà Nẵng is planning a tourism stimulation programme named “Đà Nẵng Thank You” to revive its key economic industry as soon as the COVID-19 pandemic is under control in Việt Nam.


Tourists pose for photos by the Golden Bridge in Bà Na Hills Tourism Area in the central city of Đà Nẵng. — VNA/VNS Photo Trần Lê Lâm

ĐÀ NẴNG — The central city of Đà Nẵng is planning a tourism stimulation programme named “Đà Nẵng Thank You” to revive its key economic industry as soon as the COVID-19 pandemic is under control in Việt Nam.

As part of the programme, the “Fantastic Đà Nẵng Festival 2020” will be held from May to December along its beaches to attract visitors to the so-called young and dynamic city.

The festival aims to promote the city's tangible and intangible cultural values, tourism destinations and beautiful beaches. It is also expected to connect and help local businesses to introduce their products and services, boost investment in tourism infrastructure and strengthen tourism co-operation between the city and other localities in Việt Nam.

According to the municipal Department of Tourism, the city plans to welcome 9.95 million visitors this year, including 4.15 million foreigners, which is expected to generate more than VNĐ39.7 trillion (US$1.7 billion) in tourism revenue.

However, the tourism sector suffered severe damage in the first quarter of 2020 due to COVID-19, with losses estimated at over VNĐ1.8 trillion ($77.4 million).

In the first four months this year, the total number of tourists visiting Đà Nẵng reached approximately 1 million, down 58 per cent over the same period in 2019. Of the figure, international visitors were estimated at 575,000, down 50 per cent. Total tourism revenue in the first four months decreased by 51 per cent compared to the same period last year.

It is estimated that the city’s tourism industry could lose VNĐ6.8 trillion this year.

Monitoring the complicated developments of the COVID-19 pandemic in other countries, Đà Nẵng has identified domestic tourism as the key to reviving the industry this year, and is looking to attract local visitors in the second half of 2020.

Đà Nẵng will target visitors from neighbouring localities in the central and Central Highland regions as well as co-operate with airlines to attract people from Hà Nội, HCM City, Cần Thơ, Hải Phòng and Quảng Ninh.

Director of the city’s Tourism Department Nguyễn Thị Hồng Hạnh said the city wanted to offer a stimulus for both group and individual tours, particularly young people who are not usually scared about travelling and those whose demand for travel was repressed during nationwide social distancing.

Hạnh said that at this time, many localities across the country were concentrating on the domestic market, so Đà Nẵng was looking for something different.

“The city will announce a tourism stimulus package with amazing promotions to attract tourists from now to the year-end,” she said.  

With these plans in mind, Đà Nẵng expects to welcome 2.4 million visitors and gain tourism revenue of VNĐ9 trillion in the second half of this year.

Five key areas for growth

On May 19, Secretary of the city’s Party Committee Trương Quang Nghĩa signed a directive to speed up activities to revive the city's socio-economic development once COVID-19 is under control.

The city’s top leader called for drastic measures to create new opportunities and motivation for the city’s growth. Five key areas were identified to attract domestic and foreign investment: to resume and speed up production, trade and exports; to stimulate tourism and domestic consumption; to promote public investment, and to address difficulties for major projects that had been delayed for years.

Nghĩa also asked for bottlenecks to be removed for investment procedures, construction, land clearance and compensation.

Delayed projects will have their investment withdrawn and transferred to other projects for more effective disbursement.

This year, Đà Nẵng planned to spend VNĐ12.373 trillion ($532 million) in public investment for 536 projects, of which 43 key projects would be allocated VNĐ5.25 billion.

By April 15, the city had disbursed nearly VNĐ1.6 trillion ($69 million).

However, many projects in the city are still behind schedule due to problems relating to land clearance, compensation and relocation.

For example, the Tuyên Sơn- Tuý Loan riverside road started in July 2017 and was expected to be completed in December 2018, but until now only 45 per cent of the work has been finished.

Another is the Western Ring Road No 2 – part of a project to improve the city’s transport infrastructure involving 1,821 plots of land, but until now only 182 land clearance files were signed.

Trần Phước Sơn, director of the city’s Planning and Investment Department, said the department had recommended the People’s Committee to ask project investors and local authorities to address these problems.

When land clearance was completed, constructors must have staff and equipment on hand to get on with their projects, he said, adding that work could be done around the clock to meet deadlines.

Attracting investment

In the first quarter of last year, more than US$507 million worth of foreign capital was invested in Đà Nẵng, marking a record for foreign direct investment (FDI) for the city in a single quarter.

During the period, the city granted licences to 32 new FDI projects with registered capital of $355.806 million.

Meanwhile, in the first quarter of 2020, the city attracted nearly $83.5 million from FDI projects, of which 31 new FDI projects had total registered capital of 72.9 million.

The sharp decrease has been blamed on COVID-19.

In contrast, in the first quarter of this year, the city attracted four domestic investment projects with total investment of VNĐ8.612 trillion ($370 million), or 4.72 times higher than the same period last year.

Now the city has 335 domestic projects with total investment of over VNĐ112.6 trillion.

Together with the increase of domestic investment, some major FDI projects from last year have been opened.

For example, the US-based aviation firm Universal Alloy Corporation in March put its Đà Nẵng facility – the Sunshine Aerospace Components Factory – into operation.

The factory will be the sole supplier producing over 5,000 aerospace components for Boeing aircraft.

The factory has investment of $170 million in the Đà Nẵng Hi-tech Park to produce aerospace components for export to the EU, Malaysia and North America with projected export value of $25 million by 2021 and $82 million by 2022, according to the Đà Nẵng High-Tech Park and Industrial Zones Authority.

The Xuân Thiều-Mikazuki Spa & Hotel Resort with total investment of $100 million has reportedly disbursed over 27 per cent of its total investment, and the first phase is expected to open this year.

The Đà Nẵng Hi-Tech Park, which was launched as a hub for green and hi-tech investment in 2013, has lured 18 investment projects, of which nine are foreign direct investment (FDI) with total funding of US$564 million.

Six projects including four FDI and two domestic have already been put into operation.

Head of the park's management board Phạm Trường Sơn said it was designed as one of three major national multi-functional hi-tech parks after HCM City and Hà Nội.

The Đà Nẵng Hi-Tech Park and six other Industrial Zones have drawn 505 projects worth $2.6 billion. These projects earned revenue of VNĐ35.6 trillion ($1.5 billion) in 2019, contributing $213 million to the local budget. VNS