With an increasing number of foreign tourists visiting HCM City, officials are boosting investment in tourism infrastructure facilities to meet the industryâ€™s demand.
Dong Thi Kim Vui, director of the HCM City Department of Tourism, said the department will encourage the construction of up-market hotels with a total of 2,000 rooms this year.
The city has allocated 5.9ha of land in Thu Thiem new urban area for Saigontourist to build 3,000 hotel rooms and 1,000 booths for fair events. The government-owned company will look for investors to fund the projects.
Saigontourist plans to build a total of 7,000 new upmarket hotel rooms by 2010.
The construction process is slow, however, due to the lack of available land for investors, Vui said.
Several hotel projects have acquired good locations, but land clearances and compensation for displaced residents are complicated and time consuming, she said.
The city currently has 624 hospitality facilities with a total of 10,700 rooms. There are only 12 five-star hotels, nine four-star hotels and 20 three-star hotels, which have a total of 6,000 rooms.
The city received 843,000 foreign visitors in the first three months of the year, an increase of 20 percent compared to the same period last year, according to the city Department of Tourism.
Nguyen Huu Tho, general director of Saigontourist, said the number of business people visiting the city to attend meetings, conferences and exhibitions is increasing. These people prefer higher-end hotels, Tho said.
Vui said the shortage has caused several foreign tourists to cancel their visits.
The Department of Tourism has encouraged hotel investors to upgrade existing hotels to higher standards.
Saigontourist is providing training courses to improve professional skills for staff in its hotels that will be upgraded to five stars.
The city tourism industry earned a total revenue of 6.7 trillion VND (418.6 million USD) in the first three months of the year, up 38 percent compared to the same period last year.