Boosting Tourism Revenue: The Power of Duty-Free Shopping in Ho Chi Minh City

Experts suggest Ho Chi Minh City (HCMC) can learn valuable lessons from major South Korean metropolises and Singapore by introducing more duty-free shops in bustling areas and airport terminals to increase spending among foreign tourists.

Dr. Hyejin Park, lecturer in Korean tourism and hotel management at RMIT University in HCMC, highlights the importance of shopping in increasing foreign exchange earnings, proposing that diversifying tourist attractions could attract more tourist dollars.

According to the World Travel and Tourism Council, shopping tourism generated a substantial $178.2 billion globally in 2019, accounting for 6% of travel and tourism's direct contribution to world GDP.

South Korea stands out as a major shopping tourism destination in Asia. A study on tourists from major markets showed that shopping spending in Seoul exceeds food spending, emphasizing the attraction of duty-free stores offering luxury, discounted branded and local products at attractive prices.

Countries such as Singapore, Thailand and South Korea have successfully integrated duty-free shops into busy tourist areas, increasing their appeal. In Singapore, duty-free shopping has significantly contributed to its status as a global retail hub, with the city-state strategically placing stores in city streets and airport terminals.

In HCMC, the development of major shopping centers offering diverse international brands, entertainment and convenient experiences is essential to attract high-spending tourists. It is important to understand the preferences of different tourist markets, with Asian tourists often looking for cosmetics and high-end fashion items, while European tourists prefer local handicrafts and souvenirs.

Jonathan Hanh Nguyen, chairman of Imax Pan Pacific Group, advocates the establishment of duty-free shops, low-cost branded outlets and amusement parks in the city to meet the needs of diverse tourists. He believes that addressing space issues could lead to significant revenue increases for HCMC's tourism sector.

In 2021, tourism revenue in HCMC reached VND160 trillion (US$6.28 million), with international tourist shopping contributing 9% of that figure. By taking advantage of duty-free shopping opportunities, HCMC can further increase its tourism revenues and attract a wider range of international visitors.