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Newsletter 2022/4

Friday, 12/30/2022

Dear Readers,

Welcome to the fourth edition of the newsletter of the Vietnam Competence Center for the Agricultural and Food Sector.  Quarterly we use this format to inform you about focus topics in the Vietnamese food sector, current developments and important dates. We wish you a lot of fun reading and a happy new year!

 

Kind regards
Your competence center Vietnam for the agricultural and food industry

⚡HoReCa standsector in Vietnam

For many German food exporters, hotels, restaurants and cafés (HoReCa) are an important sales market in Vietnam. This is particularly due to the pre-COVID boom in tourism in the country. However, the pandemic has hit the industry hard with two years of restrictions on travel and going out. With the opening of Vietnam in 2022, many hopes were therefore pinned on a strong recovery in the HoReCa sector.  This newsletter is intended to examine whether the sector was able to meet the expectations placed in it in 2022.

 

In 2019 came18 million foreign touriststo Viet Nam. The country was hoping before COVID, Thailand in the medium term (2019: 40 million guests) to overtake. Numerous hotel projects have been initiated at all Vietnamese tourist spots from Halong Bay in the north to the beaches of central Vietnam and the vibrant Ho Chi Minh City. In addition, the restaurant and café sector also flourished because the incomes of the Vietnamese middle class rose sharply, and they enjoyed their newly won prosperity here with meals or coffee together, among other things. These positive developments were interrupted by the COVID pandemic. From March 2020 to March 2022, Vietnam closed its borders. There were also strict lockdowns in some parts of the country; especially in the summer and early autumn of 2021. Many HoReCa businesses had to give up operations in whole or in part. This also had an impact on German exporters. For example, many meat importers had placed orders in Germany in spring 2021 in anticipation of strong summer business, which then arrived in Vietnam in the summer during the beginning of the lockdowns. The result was that sales faltered, Vietnamese customers had no cash flow and payments could not be made.

In the spring of 2022, Vietnam then eliminated most of the domestic COVID restrictions as well as entry restrictions. The HoReCa sector, which contributed 9.2% to Vietnam's GDP in 2019, was seen as one of the main beneficiaries of this development.

The domestic market mainly boosted the hotel and restaurant sector after the opening. Vietnamese consumers savored the opportunity to go out again after a lockdown-dominated 2021. Even if the GDP per capita in Hanoi and Ho Chi Minh City is only around USD 5,000 to 7,000, Vietnamese consumers spend around35% of their spending on food and beveragesout. Their consumption therefore has a significant impact on the sector. And so it was reported that"Cafe chains are booming again"  and a restaurant chain reported that in May 2022 they were already upthe level of pre-COVIDhad landed. The consulting firm "Mordor Intelligence" expects an average for the hotel and restaurant sector for the period 2021 to 2026growth of 8.65% pa

The situation in the hotel sector is less positive. While the occupancy rate in Hanoi and Ho Chi Minh City, also driven by business travellers, was up to 85% back to the pre-COVID level, the same was true of classic tourist locations, e.g. Halong Bay or the central Vietnamese beaches , less good looking. Here it wasUtilization at 50 to 70%. The reason for this situation is that, contrary to expectations, international arrivals in Vietnam were very low. In 2022, only 3.5 million foreign visitors came to the country. For comparison: More than 10 million international tourists traveled to Thailand last year. as uThe reason for the bad numbers in Vietnama relatively strict visa policy and low-quality tourism offers are described, among other things. The broker company "Savills" calculates first2024 with hotel sector recovering to pre-COVID levels.

So there is light and shadow in the HoReCa sector. German exporters can currently benefit in particular from the strong demand from the Vietnamese café and restaurant market; this applies, for example, to cheese, meat and alcoholic beverages.  The hotel sector, on the other hand, is likely to be more difficult to use in many places. However, a recovery is also to be expected here in the coming years. Incidentally, this also applies to airline catering. Both Vietnam Airlines and Bamboo Airways currently fly direct from Hanoi and Ho Chi Minh City to Frankfurt am Main.

😋🍴 "Taste of Germany" event in Ho Chi Minh City 2023

If you are interested in presenting your products to a target audience from the Vietnamese HoReCa sector, we cordially invite you to take part in the "Taste of Germany" event. This one-day event is expected to take place at the German House Ho Chi Minh City. It consists of an exhibition area, a congress, show cooking and networking opportunities. The planning for this event is still in the planning phase. If you are interested, please contact Ms. Phuong at 👉phuong.doanbich@vietnam.ahk.de.

📰 The most important news at a glance

🗓️ Events

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Details on this and other events 👉 here on the appointment page.

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📞 Contact

Ms. Phuong Doan , Project Manager

Tel: +84 28 3822 7538

Email: agriandfood@vietnam.ahk.de

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