Research objectives: One of its basic objectives is to verify the objectiveness and enormous benefits of the cooperation between Tourism and LCA. Accordingly, it will be defined the vision and solutions to promote the stable development and maintain this cooperation, then it will support for their mutual development in providing the better service’s quality as well as creating a strong and fair competition in the condition of international integration and contribute to social development.
1 MINISTRY OF EDUCATION AND TRAINING UNIVERSITY OF ECONOMICS HO CHI MINH CITY o0o PHUNG THE TAM THE LINK BETWEEN TOURISM AND LOW COST AIRLINE IN THE INTERNATIONAL ECONOMIC INTEGRATION IN VIET NAM Major: Political Economy Code: 62310102 THE SUMMARY OF A PhD THESIS IN ECONOMICS 2015 Training institution: University of Economics Ho Chi Minh City Scientific supervisor: 1. Dr. Pham Thang 2. Assoc. Prof. Dr Duong Cao Thai Nguyen Antithesis 1:… Antithesis 2:… Antithesis 3:… The thesis will be defended in front of the Council grading the school level thesis at At……., Date…………… Month……………….Year You can refer to the thesis at: Vietnam’s National Library General Science Library Ho Chi Minh city Library of University of Economics Ho Chi Minh city ABBREVIATIONS LIST APEC ASEAN Asia Pacific Economic Diễn đàn Hợp tác Kinh tế châu Á Thái Cooperation Bình Dương Associationof Asia Southeast Hiệp hội các nước Đơng Nam Á Asian Nation ASEANTA ASEAN Tourism Association Hiệp hội Du lịch Đơng Nam Á ATAG Air Transport Action Group Nhóm hành động vận tải hàng khơng BRIC Brazil, Russia, India, China Nhóm các quốc gia mới nổi CAPA Centre for Aviation Trung tâm hàng khơng CEO Chief Eecutive Officer Giám đốc điều hành CLMV Campuchia, Lao, Myanmar and Vietnam Tiểu vùng hàng không Campuchia – Lào Miến Điện Việt Nam EU European Union Liên minh châu Âu FAA Federal Aviation Administration Cục Hàng không liên bang Hoa kỳ Giao thông vận tải GTVT HTA Ho Chi Minh Tourism Association Hiệp hội du lịch thành phố Hồ Chí Minh IATA Internation Aviation Transport Association Hiệp hội vận tải hàng khơng quốc tế ICAO Internation Civil Aviation Organization Tổ chức hàng khơng dân dụng quốc tế IPO Initial Public Offering Phát hành cổ phiếu ra công chúng lần đầu JAA Joint Aviation Authorities Cơ quan quản lý hàng không dân sự của một số quốc gia châu Âu JPA Jestar Pacific Airlines Công ty hàng không cổ phần Jestar Pacific airlines LCA Low Cost Airlines Hãng hàng khơng giá rẻ (chi phí thấp) LCAS Low Cost Airlines Service Dịch vụ hàng không giá rẻ MICE Meeting Incentive Conference Event Du lịch kết hợp hội nghị PATA Pacific Asia Travel Association Hiệp hội Du lịch Châu Á Thái Bình Dương SCIC State Capital Invesment Corporation Tổng cơng ty đầu tư và kinh doanh vốn nhà nước Việt Nam Thành phố Hồ Chí Minh TP. HCM TNC Transnational Corporation Công ty xuyên quốc gia Tourism Tourism Du lịch UNWTO United National World Tourist Tổ chức du lịch thế giới Organization UNCTAD United Nations Conference on Trade and Diễn đàn Thương mại và Phát triển liên Development UNESCO hiệp quốc United Nations Educational Scientific and Tổ chức Giáo dục, Khoa học và Văn Cultural Organization hóa của Liên Hiệp Quốc USD United State Dolar Đơla Mỹ VISTA Vietnam Society of Travel Agents Hiệp hội Lữ hành Việt Nam VNA Vietnam Airlines Hãng hàng không quốc gia Việt Nam Airlines Đồng Việt Nam VND WTO World Trade Organization Tổ chức thương mại thế giới WTTC World Travel & Tourism Council Hội đồng du lịch và lữ hành thế giới INTRODUCTION 1. The immediacy of the topic: The technological and scientific revolution and globalization is the most active social, technical and economic process nowadays, which strongly impact on the development and changes of production forces and production relation in some countries around the world They appeals all branches of economics in different countries into the development, including aviation and tourism. Accordingly, they creates distinctive forms such as Low Cost Airline LCA and the association between Tourism andLCA promoting the integration of national economies more rapidly into the system of large international division of labor, forming and developing the economic links such as ASEAN, EU, However, along with development of production force is the improvement of production relations of which socialization and capital internationalization make capital ownership be far separated from the use of capital promoting the world’s economy into the financial economy era – the global currency. The technical and economic processes has pushed the world’s economy from structure, raw material, and energy crisis to monetaryfinancial crisis in the region and the world. In that global context, our country’s economy is in the period of transition to socialistoriented market economy and industrialization and modernization associated with knowledgeeconomy development through open economy strategy; therefore, it is not avoidable the negative and positive influences of the process. To make the economy escape the slow growth rate, the increasing inflation rate like now, each measure for all economic branches starts from increasing labor productivity, reducing the production cost, finding out the competitive advantages but linking the closelyrelated economic branches is preferred to intensify the benefits and lessen the risks Tourism is the service economy which is general, interdisciplinary, interregional and highly socialized.This is managerial organization form and its products created by the link of many branches, regions and different socioeconomic subjects, including the association between airlines and enterprises which trade in travel service is the important part. Especially, in the context of international and regional tourism integration which are happening powerfully nowadays, the association between aviation and tourism is the decisive factor to the success of travel products because the cost of moving the point of departure to the destinations accounts for 40% to 60% of the tour cost. Before that trend, there quickly appears the type of Low Cost Airline – LCA to meet the demand of travelling, communicating of dwellers in different countries, especially meeting the needs of discounting international tours in order to promote the development of the economics of tourism Recognizing the trend of internationalizing the tourism industry, Vietnam has proactively been accelerating the international and regional tourism integration. In the Resolution of the 11th National Congress of the Communist Party of Vietnam in 2011, people affirmed: Developing the service industry, particularly finance, banking, commerce, travel service and services with high value… Building some large national tourism center which effectivelyassociated with the large tourism center of other countries in the region. [page 198199] Responding to the appropriate of the Party, the aviation has improved and developed strongly which the private LCA enterprises is quickly established. Before the strong competition of the domestic and regional LCA enterprises engaged in our aviation service market, Vietnam National Airline (VNA) and Pacific Airlines also transfer one department to LCA Service. Pacific Airlines has transferred to the form of LCA, therefore, it has decreased the international and domestic tour. In the context of fierce competition like now, because of the limited financial and human resources and the inexperienced management, some private LCA enterprises force to accept going bankrupt or stop flying to refresh the human resources, structuring the flight crew and reorganize the managerial organization machine However, the existence and development of LCA is the objective economy .The objectiveness comes from the development need of the social productivity increasing rapidly in most countries around the world which make the income and educational level of dwellers increase continuously. It has led tourism to become indispensable part of growing people with average income or better, including developing countries like Vietnam. Welcoming the development trend of the world’s tourism, the association among industries in forming travel products is highly promoted, especially the link between tourism and aviation is considered as the stable and longterm extension strategy of two branches in the Vietnam’s economy. On April 10th, 2013 “The cooperation plan betweenVietnam National Administration of Tourism and Civil Aviation Authority of Vietnam for the period 20132015” is signed by the head of two organizations with the purposes of concretizing the cooperating program No.4050/CTBVHTTDL – Ministry of Transport on November 13th, 2012 to enhance the effective responsibility of the cooperation , quality and competitiveness of two industries which promote Vietnam’s tourism industry to develop as an attracting destination of the Asia and in the world. With that meaning, the author choose the topic as ‘’ THE LINK BETWEEN TOURISM AND LOW COST AIRLINE IN THE INTERNATIONAL ECONOMIC INTEGRATION IN VIET NAM” for his PhD thesis in political economics 2. The researching process associated with the thesis’s topic 2.1. The foreign works of Tourism – LCA association Until now, the author of the thesis has found little monograph researching respectively for the link LCA Tourism abroad, especially studying the topic in Vietnam However, in some works for researching tourism and airline or Low cost Airline, when analyzing some objective factors or development solutions of airlines, the association between airline and tourism are highly concerned and consider it as the basic solution to develop the industry. Although some works research for the tourism, analyzing the link between Tourism – LCA is still preferred, including Low Cost Airline with Tours as follow: “Tourism A new perspective” of Burn Peter and Holden Andrew “Tourism principle and practice” of Cooper, C. Gibert “Tourism in Developing countries” of Martin Oppermann and Kye Sung “Lowcost Airline in the Asia Pacific Region” of An Exceptional Intra and “Regional Traffic Growth Opportunity” of Peter Harbison “What future for Lowcost Airline in Asia” of Richard Stirland “The economic benefits of Air Transport” of IATA, ATAG Among many works regarding tourism, there are some following works taking Tourism – LCA link analysis priority. 2.1.1. The basic content associated with the link between Tourism LCA in foreign works The book “Value Creation in Travel Distribution” (2010) of Michael Straus The book “Aviation and TourismImplications for leisure travel” (2008) of Anne Graham, University of Westminster (England), Andreas Papatheodorou at the University of The Aegean, Greece and Peter Forsyth at the University of Monash (Australia) The book “Travel Economics and Traveling ” (2000) of Dong Minh Ngoc and Vuong Loi Dinh (China) 2.1.2. The contents of Tourism – LCA association has been analyzed and mentioned by the foreign authors Firstly, in three works researched and overviewed above, the foreign authors analyzed: 1) The dominant potentials and the shortcomings of Tourism – LCA association, especially analyzing the advantages when appearing LCA enterprise which provide LCAS to discount tours, create the favorable condition for developing “smokeless industry” and make up the high rate of Gross National Product (GNP) at different countries and economic areas; 2) Presenting the general method to ensure the airline can provide LCAS; 3) Initial analyzes of the role of the state, through its economic policies which promote the link and development of the two sectors and 4) By the real evidence of development and links between airlinetourism industry in different regions of the world and the activities of some specific LCA enterprises to assert the superiority of the link between the two branches Secondly, there exists some specific theories which have not been analyze by the author and will be implemented in the thesis such as: 1) The concept, nature, characteristic of links Tourism LCA; 2) the forms of linking and optimum link model; 3) The economic objectiveness of Tourism – LCA association; 4) The real link between Tourism LCA in the Vietnam’s market; 5) The success and failure of Tourism LCA and 6) The possible solution to promote the link 2.2. The domestic research on the Tourism – Low Cost Airlines link in the international economic integration In fact, until now, for this LCA business type which has just been born and its low cost airlines services have just shown to the market not so long, about 5, 6 years, so there’re no indepth and adequate research of the LCAS link with our county tourism. However, in the study of tourism or LCA could still find the basis ideas of the objectivity or the Tourism– LCA link solution, shown in the scientific subjects and scientific doctoral thesis, professional research articles and website pages 9 2.2.1. Some contents of the Tourism– LCA link solution from the scientific subjects at ministry level of the Ministry of Culture, Sports and Tourism From 2006 to present, in the ministry level projects, research on various aspects of tourism development, when mentioning of measures to promote tourism development then the link between tourism aviation always respected and regarded as one of the decisive measures for the development of tourism and aviation, including LCA Ministry level project (2006): “The research for the proposal of measures for tourism investment development” headed by Master Le Van Minh and hosted by Institute for Research and Development of Tourism Ministry level project (2007): “Research on the construction of Vietnam’s tourism competitive products in the region and internationally” headed by Dr. Do Cam Tho, hosted by Institute for Research and Development of Tourism, Ministry level project (2011): “The status and development solutions for national ocean tourism areas in the North Central region” headed by Dr. Nguyen Thu Hanh, hosted by Institute for Research and Development of Tourism 2.2.2. Some contents on the research of Tourism – LCA link in the dissertation research on tourism from the doctoral thesis of Tourism – LCA link in economic integration In the doctoral thesis, research on the different aspects of tourism development from 2007 up to now, the author of thesis spending proportional duration to analyze the advantages of tourism – aviation link in term of tourism development, considering the operation of businesses in the transport sector, especially that the aviation has great influence on cost, price, competitiveness, profitability and growth of various types of tourism business. It is clearly shown in the following thesis: Doctoral thesis, topic: “Vietnam competitiveness tourist destination” (2010) by Nguyen Tuan Anh, defended at Hanoi National University Doctoral thesis, topic “Quang Ninh tourism market in the international economic integration” by Tran Xuan Anh (2011), defended at the Ho Chi Minh National Institute of PoliticalAdministrative. Doctoral thesis in economics, topic “Business development of tourist accommodation in the Northern tourism region of Vietnam” (2011) by Hoang Thi Lan Huong, defended at National Economics University, Hanoi. Doctoral thesis, topic “Development of tourist travel services in conditions of international economic integration: Experiences of some East Asian countries and the policy suggestion for Vietnam” (2012) by Nguyen Trung Khanh, defended at the Graduate Academy of Social Sciences – Vietnam Academy of Social Sciences 10 * Some content in the research on the tourism – LCA association in the thesises which examined the aviation service’s development Doctoral thesis of economics, topic: “Accumulation and profit capabilities in the Civil Aviation of Vietnam” (1996) by Dao Manh Nhuong, which was upheld at the Ho Chi Minh Academy of National Politics Doctoral thesis in economics, topic “Establish the lowcost airline in Vietnam by the year of 2020” (2005) by Duong Cao Thai Nguyen at the University of Economics in Ho Chi Minh City 2.3. Summary result from the projects which are reviewed and the issues that the thesis will continue to study 2.3.1. Basis results from the projects which are reviewed Through the domestic and international projects which re reviewed, the following issues have been mentioned, the thesis will inherit and develop further, completion in terms of matching with content and requirements of the thesis: First, some of the domestic and international projects have mentioned about the low cost aviation service (LCAS) concept, tourism service and the basis features of these both services. Also to mention about the low cost airline (LCA) and tourism business with different business models such as: travel tour operator, accommodation operator, transportation operator serving tourism, etc. and the features of these type of business models However, in order to bring the above concepts into the thesis, need to re summarize and to add new features in accordance with the content and requirements of the thesis Second, some methods have been mentioned in some projects that the LCA companies to implement to reduce costs and supporting in the air and on the ground, selection of flying path, flying network and suitable flying crews, etc… These contents are inherited by the thesis and to expand further, binding the operation features and cost reduction method of the aviation for more consistent and similar Third, some projects have mentioned such as operation management mechanism and role of government’s policies in the development of TourismLCA link. Some projects or short articles on the website but just endup at practical describing without scientific argumentation theory of the regulatory role of the government to accelerate of this linking process, the thesis will inherit and develop further Fourth, many practical materials and the operation situation of LCA companies and tourism businesses are inherited by the thesis’s author and reconstructed under the criteria to meet the subject Fifth, most of the projects are reviewed and mention about the opinions, orientation, and the solution system to promote LCA or tourism to growth In here, the thesis only inherits the linking solutions between Tourism Aviation or Tourism – LCA to develop and improve further 2.3.2. Issues will be expanded in the thesis Until now, thesis’s author has not yet found any monograph written about the development link 11 between Tourism – LCA of the service market in our country. Therefore, the approved fundamental content in the thesis which is studied and implemented by himself. The contents are as follows: First, objectively economics demonstration of the Tourism – LCA link required by the intrinsic requirements of regulations of the both sectors, in which, the tourism products as the products launched on the basis of multisector link, and the link with the aviation plays an extreme important role, especially for the international tours Second, analysis of international economics integration, especially the tourism integration, sky liberalization requires LCA and travel tour operators must work together to confront with the LAC companies in the region and to ensure the success of the integration process, and balanced development of the both sectors in the conditions of economic globalization and booming of the scientific and technical revolution Third, construction of model and optimal linking mechanism between Tourism and using this theory to track the existing conditions of the progress of Tourism LCA link on the service market – integration of Vietnam. From that point out the necessary conditions and factors affecting the progress of this link Fourth, clearly define the role of Tourism – LCA link in the development of both sectors and for the operation of the whole economy. Especially, to launch the common product of the link to create the optimal low cost tourism product Fifth, point out the basis ideas and system of feasibility solutions to push up the linking progress between Tourism – LCA and to ensure the sustainable development in the socialistoriented market economy in Vietnam 3. The thesis’s objectives and missons One of its basic objectives is to verify the objectiveness and enormous benefits of the cooperation between Tourism and LCA. Accordingly, it will be defined the vision and solutions to promote the stable development and maintain this cooperation, then it will support for their mutual development in providing the better service’s quality as well as creating a strong and fair competition in the condition of international integration and contribute to social development In order to completed these objectives, some specific objectives are specified as below: + Systematize basic issues and conditions of LCA tourism, as well as the optimum cooperation models between Tourism and LCA on the base of applying experience in other countries + Analyse and evaluate the situation of the link between tourism and LCA in Vietnam in recent years, then, point out its achievements, weaknesses as well as solutions to improve these weaknesses and limitations. 12 + Define the trends, prospects and basic solutions to promote and enhance effectiveness of the cooperation between tourism and aviation in general and LCAs in particular in the conditions of economic intergration of Vietnam. 4. The research subjects and scopes of the thesis 4.1. Subjects Study the cooperative relationship between tourism and LCA when the urgent development of globalization and regionalization have had a tremendous impact on the enterprises, promote their association to create multisector services, products and tours. As a result, they will make a good profits on these services, increase international competition and contribute to the national development 4.2. Scopes Time: It will study the period since LCAs were established and began to provide the LCA services in Vietnam, from 2008 to 2014 Subjects and condition for survey: The thesis will mainly analyze the relationship between Tourism and LCA in the conditions of LCA competition of other countries operating in Vietnam. The cooperation among LCA, Vietnam tourism and other countries is limited, therefore, this point will be mentioned in this thesis as a trend. 5. The methodology and theoretical basis of the thesis 5.1. Theoretical basis The thesis is mainly based on the theoretical basis of Marxism – Leninism, the guidelines and policies of the Communist Party of Vietnam to link economic sectors, including the link between Tourism and LCA, as the methodology in analyzing the thesis 5.2 Methodology The main method is to specify the nature and principles of economic progressions, while comparative, statistics, modeling, scientific abstraction methods, and reference study methods to collect information about the rationale are to supplement and demonstrate to the arguments The analysis and synthesis methods which the author used to analyze the rationale in Chapter 1 and the situation of association between tourism and low cost airline in Chapter 2 are considered as the basis for making policies and solutions in chapter 3 Statistics and explainations method used in chapter 2 is to illustrate the state of the cooperation between tourism and LCA 13 Modeling methods used in Chapters 1 and 2 in order to clarify the cooperation problems between tourism and LCA Scientific forecasting methods used in chapter 3 to provide trends and perspectives for the association between tourism and LCA, and then give the suitable, effective and feasible solutions. 6. Theoretical and practical contributions of the thesis Theoretical contributions: The thesis has proved that the cooperation between tourism and LCA is a objective economic aspect which arised from their demands to expand and specialize the services and products under the impact of technology development and international economic integration. Gradually, it will form a optimum cooperation between tourism and LCA based on their mutual benefits Practical contributions: The thesis has analyzed and verified the state of this cooperation at different levels, evaluated the achievements, and pointed out its strengths as well as weaknesses in recent years, then it will be the base to propose the suitable solutions in the coming years Propose effective and feasible policies to promote the cooperation under the circumstance of international economic integration in Vietnam, and enhance the operation effectiveness of tourism and aviation, contribute to the social development 7. Structure of the thesis consists of 3 chapters 8 units: Chapter 1 Theory and practice as to tourism – lowcost airline link in international economic integration Chapter 1 has 3 units: Unit 1: The general theory of linking and developing LCA along with tourism in international economic integration. Therein, present the following basic theoretical issues: 1) Tourism, tourism service and basic characteristics of tourism service. Tourism service is all services that are provided to tourists, including transportation, accommodation, catering, recreation, guidance and other services in order to meet demands involved in the trip of tourists. In economic integration, this service is classified into two types, namely service for inbound and outbound international travelers. As any other service, tourism service is invisible, indivisible, mutable and biodegradable. In addition, tourism service has two specific characteristics which are heterogeneous and no ownership; 14 2) Lowcost airline service is specific service created on the basis of maximum cost saving, such as exploiting effectively necessary flying conditions for safest flights in order to expand served object to low income customers aimed at maximizing profit. In addition to common characteristics of service product, LCAS also has specific characteristics, which are: tourists can enjoy superior and better service than the cost they have paid, being able to stimulate association and joint venture; 3) The link between LCAS and tourism is analyzed basing on the theory of competitive advantage authored by Michael Porter, which defines the objectivity of the link between LCAS and tourism basing on the advantage that these enterprises provide services involved in the process of forming tours, therein LCAS occupies important position in the early and late stages of tours’ valueadded chain Unit 2: Features, Conditions, principles and models of the association between Tourism services and Lowcost Airline 1) The basic principle of the cooperation is presented that both Tourism and LCA have all conditions and abilities to contribute to their mutual development 2) The conditions to create and promote the cooperation between two parties are believed that when tourism profits increase, the tourism services will be accordingly expanded and developed rapidly, and then, as a result that this will support for sustainable growth of LCA firms as well as their capability of providing LCAS; 3) We can base on the specific operation of LCA firms to propose two kinds of cooperation models, they are: comprehensive cooperation and flexible cooperation model. Primarily, comprehensive cooperattion is the model in which LCA is a member of the lowcost tourism corporation; and the flexible one will be established with the basis of their independent operation and only when one of them has demands at a certain time, they will cooperate with each other via the economic contracts and supervised by a common council or board to achieve the highest profits, shown in the chart 1.1 as below Chart 1.1: The theoretical links among three parties: LCA, Tour Operators and Tourism Destinations 15 Source: Synthesized from the author’s researches The advantage of this linking model ensures LCA firms and tour operators the stable, sustainable development and providing LCAS sufficiently and promptly Unit 3: Present the experience of building and linking business between LCA firms and tour operators of ASEAN, therein present the experience of typical firms, namely LCA Lion Air (Indonesia), LCA Tiger Airways (Singapore), Air Asia LCA, LCA Jetstar (Australia) Experience analyzed here is the experience of the development in both scale and quality of each firm, in which the growth of facilities, workforce is focused, for instance, plane quality, staff and pilot qualification are noticed to assess and consider. In addition, the expansion of flight network and the provision of services are focused to evaluate. And especially, the thesis analyzes linking models between LCAS and tourism in order to find out the effectiveness of each model. There from draw 3 lessons for developing LCA firms and 4 lessons for linking between LCAS and tourism. It is the link between LCAS and tourism for reducing tour price, creating a traditional customer base of the company by providing best services, cheapest prices possible. It needs to promote the tourism development according to specific process, plan and expand the link with LCA firms and tour operators in the region Chapter 2 16 The current status of the lowcost airlines – tourism linkage in the international economic integration in Vietnam nowadays Chapter 2 has 3 units with the following basic contents: Unit 1: An overview of the current status, development and the linkage between the Low cost Airlines and tourism in the international economic integration, including: 1) Give an overview on the current operational status of tourism in the period of over 10 years from 2000 to 2010 with the fact that although we had the similar starting point as did Thailand, Singapore, Malaysia, we are inferior to them in terms of visitors attracted, incomes and visitor spending rates. But in within three years from 1010 to 2013, we attracted 6 million international tourists and 30 million domestic visitors (2011). And that in 2013, we attracted 7.2 million international visitors and 33 million domestic visitors, totaling the revenue of 190 trillion Dong. The bilateral and multilateral linkage between the traveltourism agencies and the foreign Lowcost Airlines from China, South Korea, Australia, Japan, Thailand, Singapore and those from the ASEAN region, the Mekong subregion, the APEC forum, etc And that especially, when the Vietnam Lowcost Airlines have been formed, the domestic linkage has been strengthened; 2) Give an overview on the reality of the establishment, development and operation of the 5 Low Cost Airlines such as Jetstar Pacific Airlines (JPA), VietJet Air, Air Mekong, Vietnam Airlines (VNA) being involved in the supply of Lowcost flights and Indochina Airlines The circumstances of the establishment, development and failure of each Airline are mentioned to assess the status of the supplying linkage between the LowCost Access to Space of each airline and the traveltourism agencies So far, beside two state companies of JPA and VNA, only Vietjet Air and Jetstar are still self sustaining in the Low Cost Airlines market. One of the fundamental reasons for the success of these companies is related to the good procedures and models in supplying the linkage of LowCost Access to Space and the traveltourism agencies Unit 2: Specifically present the linkage status between the traveltourism agencies with the suppliers of the LowCost Access to Space in the international economic integration in Vietnam on the following aspects: 1) Assess the general status of the linkage of the tour service suppliers of three entities: Travel – Low Cost Airline – Resort. Since their establishment, the Lowcost Airlines have been accounted for more regularly and been increasingly having a larger proportion, especially when Vietnam had further 17 integration into the ASEAN and its national sky was opened. Tourism cooperation is seen as the two hands that lift the airplane on the sky, since 7080% of tourists are travelling to Vietnam by air, including the Lowcost Airlines. In 2010, there were 30 foreign airlines setting their base in Vietnam. However, this linkage faced major challenges the in the following years: increasing gas prices, aircrafts of lower payload, the fierce competitiveness between the Lowcost Airlines excessively pursuing profits, loose linkage of the factors, many Lowcost Airlines went bankrupt for their weaknesses, especially those of Vietnam; 2) As already acknowledged the common characteristic of the service products features the fact that production and consumption simultaneously take place and are inseparable. Thus, the link of the LowCost Access to Space and the tourism service is actually the link of the two said entities. Therefore, when analyzing the linkage model, the thesis went deep into the operation of these entities, taking the activities of the Lowcost Airlines for the emphasis for the analysis. In this process, the reasoning models of the entities of the Lowcost Airlines Travel – Resort were taken into account to examine the operations of Air Mekong, JPA, VNA, and Vietjet Air to point out the success, limitations and the causes of such limitations through each tourism boost Section 3: The limitations and the causes of the lowcost airlines – tourism linkage in the international economic integration. With the practical data on the number of visitors, the number of destinations and the primitive fares details of the Lowcost Airlines and other tourism services, this thesis confirms that the lowcost airlines – tourism linkage guarantees that all the stakeholders are growing and successful. In addition, the thesis also specifies the limitations coming from the stakeholders excessively pursuing profits. This comes from the limited aviation infrastructure, the spontaneous link of the Low cost Airlines and the resorts, the untimely support from the specialized State agencies, and the lack of linking activities to the strong partners from abroad to promote the international economic integration. Those matters have limited the advantage of the two linkages of this entity. See chart 2.5 below for references: Chart 2.5: The numbers of passengers on flights from Vietnam to Singapore and return of LCA firms from 2009 to the end of 2014 (Total flights HANSIN and SGNSIN and returns) (unit: thousand) Source: Civil Aviation Administration of Vietnam Chapter 3 18 The viewpoints on and basic solutions for promoting the lowcost airlines – tourism linkage in the international economic integration nowadays Chapter 3 has 2 units with the following basic contents: Unit 1: The potentials, trends and basic viewpoints that promote the lowcost airlines – tourism linkage in the international economic integration: 1) There are basic trends that promote the lowcost airlines – tourism linkage in the international economic integration: the industry's profitability has been decreasing continuously from 2010 until now due to the rising fuel prices and the public debt crisis in the EU resulting in the increasing taxes for CO2 discharge, meanwhile the Asia Pacific region still features good business conditions for consequently promoting the regional connectivity process; the explosion of the scientific and technological revolution promotes globalization and integration; the international Lowcost Airlines strongly penetrate the Asia Pacific LowCost Access to Space market. This area features a favorable geographical economic position for the LowCost Access to Space development and the linkage between the Lowcost Airlines and tourism 2) The potential of natural and humanities tourism resources of Vietnam are great for tourism development and offer the favorable conditions for the lowcost airlines – tourism linkage; 3) On the basis of the international trends and the potential of the lowcost airlines – tourism linkage of Vietnam, it is possible to make out the following 4 viewpoints to promote the lowcost airlines – tourism linkage: Actively integrate into the regional and global economy; Consistently maintain the economic sectors under the State’s management Promote the lowcost airlines – tourism linkage, offer favorable conditions for the 2 industries to grow stably, sustainably and effectively, Ensure a the benefits balance of all the stakeholders in the linkage, and that they have satisfactory profits Unit 2: This thesis presents three groups of solutions which impact the macro and micro conditions to the stakeholders in the linkage and in the international economic integration, such as: 19 1) For the policies group and micro solutions group, this thesis addresses the legal framework for the development of tourism, lowcost airlines and the linkage of these 2 subjects; 2) The policies group and the macro solutions group directly affect the development of tourism agencies, lowcost airlines and the conditions that promote the link between them; and 3) For the solutions group for promoting the lowcost airlines – tourism linkage in the international economic integration, this thesis mentions the setup of the institutions for the shortterm and longterm linkage programs, and the coordination between the relevant ministries for such linkage of each country within and outside the ASEAN CONCLUSION The linkage between tourism and the aviation industry, especially the linkage between tourism and the lowcost airlines, is progressing considerably between the economies of different development levels due to the explosion of scientific and technological revolution, globalization and the international economic integration.This objective fact comes from the internal movement and development of these 2 spearhead industries themselves The significant role and impact of this economic linkage in the sustainable development of the developing economies having favorable natural conditions for developing green and smokeless tourism as our country are enormous. However, our domestic lowcost airlines have not been in business long, the private lowcost airlines are facing many obstacles and failures, many companies have had to stopped or suspended their operation due to the lack of resources and experience in business operational organization Especially, the effective model and mechanism for the linkage between tourism and lowcost airlines to ensure that this new form of business develops sustainably, stably and efficiently have not been specified in Vietnam. Thus, choosing this topic for a doctoral thesis is realistic and productive, it is imperativeboth in theory and practice To complete a new task, with no precedence for reference in Vietnam so far is difficult for the author Yet, with my effort, the wholehearted support from the instructor and the assistance from my classmates, the thesis has been completed for now The research has presented the theoretical and practical issues regarding the development linkage between tourism and the lowcost airlines, which were left by the previous researchers. They are the theoretical and practical issues which were studied but were yet to be fully analysed, and they are also the issues that have not been studied in theory and proved in practice. The thesis has analyzed and studied the theoretical and practical issues in Vietnam and the region in terms of the tourism lowcost airlines linkage, making out the role of this linkage in the development of the tourism and lowcost airlines themselves. At the same time, the thesis also studies the experiences of the other countries in the region 20 having the similar economies for the establishment and development of this form of linkage. The thesis has examined the business activities of the private and venture lowcost airlines, as well as the linking mode between them and tourism in practice on all aspects as required by the thesis. From this point, the achievements to be promoted, and the limitations to be remedied are indicated for this linkage form to develop sustainably and efficiently. The thesis points out the trends, development viewpoints for the low cost airlines – tourism linkage, from which the groups of feasible solutions for the development of the lowcost airlines – tourism linkage in the international economic integration of Vietnam are established, in order to efficiently exploit and employ the resources of tourism and aviation in the economic social development. Although the thesis has been completed, due to the research student’s limited capacity and shortcomings as well as the scarcity of references resources on this topic in Vietnam, I am looking forward to the instructions from the scientists for this thesis to be corrected and adjusted to the requirements of a doctoral thesis in political economics The research limitations and further directions The study was approached in the traditional and convenient methodology: focusing on the aviation industry and lowcost airlines. During the research process, I always kept up with the tourism and aviation workshops, and the multidisciplinary cooperation workshops, but all of them were limited to the ones within the country, without the conditions for the overseas ones. The survey is limited to the lowcost airlines in Vietnam and those who have flight routes to Vietnam, mostly from the Southeast Asia. The studied forms of multidisciplinary linkage are just the initial ones, not necessarily an overview to reflect the nature of the linkage The following researches may continue with the surveys of a wider range and be able to identify the new elements that complete the current research model. Overcoming the limitations of resources and funding to be able to survey the foreign tourism agencies, or expand the research to other continents PROPOSALS To increase economic effectiveness of the cooperation between tourism and LCA, some proposals will be recommended in this thesis as following: 1. To Government and The National Assembly: Quickly amend to Vietnam Tourism Law (2005) which is now outdated and exposed many inadequacies, adjust it to become an open trend in accordance with the political program of Communist Party of Vietnam, 2011 about international intergration 21 Upgrade Civil Aviation Administration of Vietnam to be Ministry of Vietnam Civil Aviation or an agency which is equal to a ministry under the government’s management. Besides its comprehensive administration of civil aviation, it will also manage and supervise education, training and development for aviation 2. To Air navigation Department and Ministry of Transport Invest and renovate the current pilot training centers, socialize labor resource to establish a civil pilot school in Vietnam which will be a national and regional rank school, to train more civil pilots in the circumstance of pilot shortage currently Give opportunities and conditions for the establishment of private aviation, as well as set up the management institutions to big aviation firms which have been sponsored by The State in order that they will not prevent or be an obstacle for the new aviation firms at the beginning operation time 3. To Ministry of Culture, Sports and Tourism, The People’s committee of all levels Regularly organize seminars for tourism companies and other related sectors, especially for LCAs Eliminate the clinging vendors with international visitors which have been existent in many tourism destinations ANNOUNCED SCIENTIFIC WORKS: 1. Phung The Tam (2007) “Building Pacific Airlines according to the model of lowcost carrier” Journal of Theoretical Education No. 32007 Hanoi 2. Phung The Tam (2013) “The link between tourism and lowcost airline in the international economic integration” Vietnam Tourism Review No. 12/2013 Hanoi 3. Phung The Tam (2013) “Promoting and improving the efficiency of aviation cooperation with tourism in the international integration in Vietnam” Schoollevel scientific topic. Code: NCS2011 02. Ho Chi Minh City 4. Phung The Tam (2014) “Some solutions for linking tourism with lowcost airline in the international economic integration in Vietnam” Journal of Reporter No. 01/2014. Hanoi 5. Phung The Tam (2014) “Linking with tourism Opportunities and solutions for lowcost airline in Vietnam” Vietnam Aviation Magazine No. Period 1 published on 3/2014. Hanoi 22 6. Phung The Tam (2014) “Linking with lowcost airline service to develop tourism in Vietnam in the period of integration: Trends and Solutions” Journal of Science, Van Hien University No. 04.08/2014 Ho Chi Minh City 7. Duong Cao Thai Nguyen (Assoc. Prof., Ph.D.) – Chief Editor, Phung The Tam and Associates (2012) “Designing and manufacturing trial electric car applied in airport”. Ministrylevel scientific topic. Project No.: NL112004. Ho Chi Minh City 8. Chu Hoang Ha (Ph.D.) Chief Editor, Phung The Tam and Associates (2012) Textbook “Airport planning” Ho Chi Minh City 9. Duong Cao Thai Nguyen (Assoc. Prof., Ph.D.) Chief Editor, Phung The Tam and Associates (2014) Textbook “Airport exploiting” Ho Chi Minh City ... issues? ?in? ?Vietnam? ?and? ?the? ?region? ?in terms? ?of? ?the? ? tourism low? ?cost? ?airlines linkage, making out the? ?role? ?of? ?this linkage in? ?the? ?development? ?of? ?the? ?tourism? ? and? ?low? ?cost? ?airlines themselves. At? ?the? ?same time,? ?the? ?thesis also studies? ?the? ?experiences? ?of? ?the? ?other countries? ?in? ?the? ?region ... development? ?and? ?offer? ?the? ?favorable conditions for? ?the? ?low? ?cost? ?airlines –? ?tourism? ?linkage; 3) On? ?the? ?basis? ?of? ?the? ?international? ?trends? ?and? ?the? ?potential? ?of? ?the? ?low? ?cost? ?airlines –? ?tourism? ? linkage? ?of? ?Vietnam, it is possible to make out? ?the? ?following 4 viewpoints to promote? ?the? ?? ?low? ?cost? ?airlines... two industries which promote Vietnam’s? ?tourism? ?industry to develop as an attracting destination? ?of? ?the? ?Asia and? ?in? ?the? ?world. With that meaning,? ?the? ?author choose? ?the? ?topic as ‘’? ?THE? ?LINK? ?BETWEEN? ?TOURISM? ?AND? ?LOW? ? COST? ?AIRLINE? ?IN? ?THE? ?INTERNATIONAL? ?ECONOMIC? ?INTEGRATION? ?IN? ?VIET? ?NAM? ?? for his