part ii: strategy and action plan to encourage tourists to stay longer

Part I

Strategy and Action Plan to Encourage Tourists to Stay Longer and Spend More on the

North-South Economic Corridor

Luang Namtha & Bokeo Provinces, Lao PDR

GMS-Sustainable Tourism Development Project in Lao PDR

Lao National Tourism Administration

August 2009

Prepared byAsian Center for Tourism Planning and Poverty ReductionThammasat University Rangsit CampusFaculty of Social Administration Building, Rm.213, 2nd FloorKlong Luang, Pathumthani 12121 THAILANDTel: (66-2) 696-5508 Fax: (66-2) 986-8322Website: www.tu.ac.th/org/socadm/actppr E-mail: [email protected]

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http://www.tu.ac.th/org/socadm/actppr

Figure 1: Map of GMS North-South Economic Corridors

Source: Toward Sustainable and Balanced Development: A Strategy and Action Plan for the GMS North-South Economic Corridor, October 2008

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TABLE OF CONTENTS

1. BACKGROUND AND PURPOSE OF THE STUDY.................................................4

2. CURRENT TOURISM SITUATION - NSEC IN LAO PDR.......................................4

3. EXISTING TOURISM PRODUCTS & MARKETS...................................................53.1 Luang Namtha Province.....................................................................................53.2 Bokeo Province..................................................................................................9

4. NEW POSSIBLE MARKETS.................................................................................134.1 Family/ Leisure Group on Package Tours from Thailand and China...............144.2 Nature-based tourists/ adventure tourists from other countries in Asia............16

5. IDENTIFICATION OF NEW TOURISM ACTIVITIES ALONG R3.........................175.1 STDP Identification of Tourism Products along NSEC R3...............................175.2 Recommended New Tourism Products and Activities.....................................21

6. STRATEGY & ACTION PLAN INCREASE NSEC TOURISM BENEFITS...........246.1 Diversification of Tourism Products..................................................................246.2 Innovative Communication...............................................................................266.3 Provision of Visitor Infrastructure and Facilities...............................................276.4 Effective Branding and Marketing....................................................................27

7. PRELIMINARY VISITOR FORECASTS................................................................307.1 Average Annual Growth Rate during 2004-2008.............................................307.2 Growth projections and benefits accruing from effective implementation of the strategy...................................................................................................................31

8. BENEFICIARIES....................................................................................................33

9. IMPLEMENTATION...............................................................................................34

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1. BACKGROUND AND PURPOSE OF THE STUDYThe North-South Economic Corridor (NSEC) consists of three major routes that follow the north-south axis of the Greater Mekong Subregion (GMS) including: (i) the Kunming-Chiang Rai-Bangkok highways that traverse Lao PDR or Myanmar; (ii) the Kunming-Hanoi-Hai Phong route; and (iii) the roadways linking Nanning to Hanoi via the Youyi Pass or Fangcheng-Dongxing-Mong Cai route.

This study is focused on the section of the NSEC beginning at the Lao PDR-China immigration terminal at Boten and Lao PDR-Thailand border at Houei Xai. The objective of the study and subsequent Strategy is to outline strategies and actions aimed at improving tourism along NSEC in Lao PDR and encouraging tourists to stay longer and spend more money in the area. Intended outcomes of the Strategy are to better secure the NSEC’s natural, cultural and historic tourism assets and create jobs and income generating opportunities for local people living near the road, especially women and ethnic groups.

Information in this document was obtained from several primary and secondary sources, including the GMS-STDP’s formulation reports and RRP. A 10 member, multi-disciplinary team consisting of tourism and heritage interpretation specialists, architects and local tourism and heritage management officials performed a 6-day field-survey on the NSEC in June 2009 to assess the tourism potential and limitations at primary and secondary sites identified by the Luang Namtha and Bokeo PTD’s. The main data collection instruments included site surveys along the NSEC, interviews with officials and private sector tourism and accommodation operators, literature review and field observations. There were also interviews using questionnaires developed by the STDP and discussions with key informants in 7 communities including:

Ban Nam Dee, Luang Namtha province Ban Vieng Nua, Luang Namtha province Ban Chaleunsuk, Luang Namtha province Ban Nam Eng, Luang Namtha province Ban Nam Pae, Luang Namtha province Ban Don Chai, Bokeo province Ban Nam Chang, Bokeo province

2. CURRENT TOURISM SITUATION - NSEC IN LAO PDRThe NSEC in Lao PDR (National Route 3) passes through the two northwestern provinces of Luang Namtha and Bokeo as shown in figure 2. At its southern end is Chiang Rai province in Thailand and to the north is Yunnan province in China. This section of the NSEC includes Houei Xai District in Bokeo and Vieng Phouka and Namtha District in Luang Namtha. Total distance between the Houei Xai and Boten immigration checkpoints is approximately 240-km, consisting of a two-lane, paved all weather roadway that was completed in 2008. As of 2009 it takes about 4.5 hours to drive the 240-km Lao section because some parts of the road are under repair.

With completion of major road works, it is expected that NSEC will serve as the main land route providing opportunities for trade and investment in several development areas including tourism. Since the NSEC was improved and opened in 2007, there is an increasing number of travelers using the NSEC to cross Lao PDR going to and from Thailand and China. Driving along the NSEC offers opportunities to see an excellent variety of mountain landscapes and ethnic minority communities.

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Although many opportunities to boost local visitation exist, provincial tourism statistics in Luang Namtha and Bokeo suggest that there are very few tourists visiting attractions situated along the NSEC. Some reasons why are a lack of awareness among tourists and operators about the sites, lack of quality tourism products and services, lack of visitor services and facilities, and lack of hotels and restaurants. Thus, there are currently minimal opportunities for local communities living along the NSEC in these 2 provinces to participate in and capture economic benefits from tourism.

Figure 2: Route No. 3 (NSEC) linking Bokeo and Luang Namtha Provinces

3. EXISTING TOURISM PRODUCTS AND MARKETS

This section of the Strategy outlines the current tourism situation, existing tourism products, existing markets and facilities in Luang Namtha and Bokeo.

3.1 Luang Namtha ProvinceLuang Namtha province has developed a reputation for the quality of its nature-based tourism. It can be accessed by air, land and river. Lao Airlines offers regular flights to Luang Namtha’s new airport (completed in 2008) from Vientiane on the ATR-72 and MA-50 aircraft. As mentioned above, Route No. 3 that connects China to Lao PDR and Thailand was completed in 2007, making land transportation very convenient. With completion of the road works, less and less visitors travel up the Namtha River from Houay Xay, but in 2009 it was still possible to reach Luang Namtha by river from June – January.

Tourism Situation

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The number of international tourist arrivals to Luang Namtha between 2001 and 2008 has increased nearly fivefold. A doubling of arrivals between 2006 and 2008 is attributed to completion of the NSEC. The significance of this increase must be carefully considered given the relatively low level of existing visitors in 2006. International arrivals to Luang Namtha are calculated based on the number of tourists that cross at the Boten international checkpoint, which include both visitors staying in Luang Namtha and transit visitors. These figures and other select indicators are reported in table 1.

Table 1: International tourist arrivals and select indicators in Luang Namtha , 2004-2008

Luang Namtha Province 2001 2002 2003 2004 2005 2006 2007 2008

No. of international tourist arrivals

79,006 19,319 29,720 41,658 49,258 47,788 88,427 197,202

Average length of stay (counted only for visitors staying in Luang Namtha )

N/A N/A N/A 5 days 4 days 4 days 5 days 5 days

Average daily expenditure in USD

N/A N/A N/A 16 USD 16 USD 17 USD 20 USD 20 USD

Revenue in USD N/A N/A N/A 2,377,600 3,152,512 4,401,680 6,000,000

Percentage of tourists on a package tour

N/A N/A N/A 11% 4% 2% 2%

Source: LNTA 2008 Statistical Report on Tourism in Laos & Luang Namtha PTD Statistical Report

The major international tourist markets for Luang Namtha are independent travelers. Main long haul source markets are the UK, France, Germany, Holland, Australia, Canada, USA and Japan. This long-haul group is presently seen as an important market for Luang Namtha province because of their interest in trekking activities, visiting ethnic villages and participation in other types of adventure activities such as visits to caves, waterfall, camping, bird watching, rafting, and mountain bike riding. It is important to take into consideration that some of these markets are experiencing significant change. The relatively high cost of travel has led some experts to believe that the European market will diminish even further. Therefore, there must be caution exercised about dependence on some sectors of the European market. The length of stay for this market segment is approximately 5 days with peak visitation from September – January.

Based on the Luang Namtha Provincial Tourism Department’s (PTD) statistics (2008) gathered from hotels, guesthouses and tour operators, it is estimated that the number of visitors that stayed in Luang Namtha was 41,000 in 2007 and 63,200 in 2008. This means there is a large proportion of transit visitors who are either Chinese or Thai citizens passing through Luang Namtha to other destinations such as Chiang Rai, Yunnan or other parts of Lao PDR. This group typically does not spend any nights in Luang Namtha, therefore generating minimal benefits for the destination or communities found along Route 3.

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It must also be determined whether or not the Chinese market is interested in the tourism options of the area that are generally nature-based or connected to minority communities. The challenge is to better understand this market in order to determine what kind of experiences and products they are looking for, therefore more market research needs to be done on this growing market segment. Chinese tour operators have visited Lung Namtha to find out what tourism activities the region offers. Barriers at this stage are suitable facilities and the language barrier between Lao and Chinese. Very few Lao people in Luang Namtha speak Chinese.

Tourism Products and Activities

The main tourism products in Luang Namtha are centered on the province’s natural resources and cultural/ethnic diversity. There are many different types of activities offered in Luang Namtha, and visitors have a wide selection to choose from depending on their preference (e.g. length of tour, difficulty of trekking, attractions). Most tours are organized by local tour operators based in Luang Namtha Town. Tourists can easily find information about these tours from a wide range of media such as websites1, the information center in Luang Namtha Town or Vieng Phoukha District Center, brochures, posters and displays.

Figure 3: Main types of tour products offered in Luang Namtha

Tours that provide interaction with cultural or ethnic diversity have been promoted as part of trekking activities in Luang Namtha. For example, the Akha Trail, Sam Yot Trek or Nalan Trek visits Hmong, Lanten and Khamu villages. However, there are very few less strenuous programs or activities that allow general visitors to learn more about ethnic diversity in Luang Namtha. Developing this type of activity could attract new market segments into Luang Namtha, for example, researchers and students who are interested in learning about different ethnic groups, and older tourists that do not want to participate in trekking tours. Better education and interpretation programs for cultural and ethnic diversity should be developed at all easily reached sites (e.g. Nam Dee Waterfall, That Phoum Phouk, That Luang, Ban Vieng) in order to enhance Luang Namtha ’s attractiveness and competitiveness.

Some additional attractions found in Luang Namtha town that if improved could diversify visitor experience and help extend the length of stay and spending are the Luang Namtha museum, night market, handicraft village Ban Pieng Ngam and lao-lao making village Ban Nam Ngaen. If better promoted, tourists may spend one more relaxing day around town to explore these sites by themselves. Visitors can also explore by foot, bicycle, motorcycle or inexpensive tuk-tuks. There is still a 1

www.luang-namtha.org www.ecotourismlaos.com

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http://www.ecotourismlaos.com/

http://www.luang-namtha.org/

need, however, to improve interpretive and directional signage for all the sites as well as overall site maintenance and management. The Luang Namtha museum has interesting artifacts but the information provided presently is quite basic and needs to be improved. It is noted that during the survey, a new museum is under construction, and it is expected that information and exhibits will be improved. It is recommended that the interpretation at the new museum is designed with a variety of interpretation techniques and media. Brief information about each site including the map of Luang Namtha Town, and brief information, entrance fees, possible modes of transportation and distance should also be presented.

Hotels and Restaurants

According to the LNTA’s 2008 Statistical Report, there are 4 hotels2 and 70 guesthouses in Luang Namtha province. Most accommodation establishments are located in Luang Namtha and Muang Sing districts. Existing hotels in Luang Namtha are quite small and typically have no more than 20 rooms. Limited room capacity was mentioned as an obstacle for tour operators to include an overnight stop in Luang Namtha as part of regional tour programs.

Table 2: Accommodation & restaurants in Luang Namtha, 2008

Luang Namtha Province Number Rooms Beds

Hotels 4 86 126

Guesthouses/ Resorts 70 728 1039

Restaurants 67 - -

Source: LNTA 2008 Statistical Report on Tourism in Laos

Most accommodation is located in Luang Namtha town and geared for budget travelers. They offer basic facilities priced from USD 3-20 per night. The Boat Landing Guesthouse caters to higher spending international tourists. It has 10 rooms and is designed as a nature resort with environmentally friendly features (e.g. no television or air conditioning and solar power), and serves high quality local food. The price range here is from USD 35-60 per night and the owner reports occupancy rates exceeding 60%.

In early 2009, the Royal Hotel owned by a Chinese investor was opened in Luang Namtha town. The hotel has 96 rooms, a big restaurant and meeting facilities. This hotel allows Luang Namtha to accommodate different groups of people such as visitors on package tours and business people who come for meetings/ seminars. In addition, the Dok Champa Hotel has plans to expand its capacity from 23 rooms to 60 rooms and expects the expansion to be complete in late 2010. Both hotels provide standard hotel facilities such as air conditioning and television.

There is a big Chinese-owned hotel at the Boten border called the Golden Boten Casino & Hotel. Thai package tours often stay at this hotel before crossing to Yunnan province in China. This hotel has the capacity to accommodate big groups of tourists and has a casino.

Most restaurants in Luang Namtha are small and offer many different kinds of food including Lao, Western, Chinese, Indian and Thai. Out of 67 restaurants, one (Heuan Lao) has demonstrated sufficient capacity to accommodate big groups of people on a regular basis. The Heuan Lao Restaurant is operated by a Thai investor

2 To be classified as a hotel, the establishment must have 16 bedrooms or more

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and is the main restaurant serving Thai groups that pass through town. Tour operators mentioned that they include this restaurant in their programs for lunch because of fast service and reasonably priced, good quality food.

3.2 Bokeo ProvinceBokeo is known as a rich mining center for gold and sapphires. Situated in the heart of the Golden Triangle, Bokeo province borders Chiang Rai province in Thailand as well as Myanmar. It can be easily accessed by air, land and river. Transportation between Chiang Rai and Houay Xay via the Mekong River ferry crossing is very convenient.

Houay Xay, the main town in Bokeo sits on the bank of the Mekong River and is known as the gateway to explore the northern Lao PDR. It is a stopover for most international arrivals before they board a boat and head down the Mekong to Pak Beng and Luang Prabang. A trip north on the Mekong from Houay Xay usually ends at Xieng Kok, but most travelers elect to travel north to Luang Namtha via Route 3.

Tourism Situation

The number of international tourists from 2004-2008 entering Bokeo province from Houay Xay border checkpoint is shown in table 3. It is estimated that the average length of stay in this transit destination is one day/night and average spending 20 USD – slightly less than in Luang Namtha because there are less organized activities offered here. The Bokeo Provincial Tourism Department (PTD) is in the process of collecting information on length of stay, daily expenditure and revenue and this data should be available by late 2009.

Table 3: International tourist arrivals and select indicators in Bokeo, 2004-2008

Bokeo Province 2004 2005 2006 2007 2008

No. of international tourist arrivals 79,006 89,027 85,512 112,157 145,567

Average length of stay 1 day 1 day 1 day 1 day 1 day

Average daily expenditure in USD 20 USD 20 USD 20 USD 20 USD 20 USD

Revenue in USD 1,580,120 1,780,540 1,710,240 2,243,140 2,911,340

Percentage of tourists on a package tour >5% >5% >5% >5% >5%

Source: LNTA 2008 Statistical Report on Tourism in Laos, Bokeo PTD Statistical Report and STDP Estimates

The number of international arrivals at the Houay Xay border checkpoint increased by 30% annually between 2006 and 2008 following completion of R3. Approximately 70% of international tourist arrivals are Thai and the rest are from European and American markets such as France, UK, USA, Germany and Netherlands. These long-haul markets come for trekking and the Gibbon Experience in the Nam Kan National Protected Area where Black Cheek Crested Gibbons, one of the world’s rarest, are still found.

The Bokeo Provincial Tourism Department (PTD) reports there is a casino and hotel development being constructed at Tonpheung. It is a 500-room casino hotel with restaurants and meeting facilities. A golf course equipped with 300-room hotel is also under construction in Houay Xay. This will increase Bokeo’s capacity to

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accommodate big groups of visitors and create employment opportunities for the area.

A major market, estimated to be more than 60%, is one-day or transit visitors that can be categorized into 2 groups.

a) One-day visitors who come to visit attractions in Bokeo

This mainly Thai group visits Bokeo for one day and returns to Thailand in the evening without staying overnight.

b) Transit visitors

This group spends very little or no time and money in Bokeo since their target destination is Sipsongpanna (Xishuangbanna) in Yunnan province of China or Luang Prabang. A large percentage of tourists are Thais on package tours traveling on the NSEC from Bokeo – Luang Namtha – Yunnan, followed by international visitors that travel to Luang Prabang on boats that depart from Houay Xay. Most of these international transit visitors entering Laos spend the night in Chiang Khong, cross into Laos in the morning and then depart directly for Luang Prabang.

Compared to other provinces in Lao PDR such as Vientiane, Luang Prabang and Champassak, Bokeo province is presently not known as a tourist destination due to a lack of awareness about the province’s tourist attractions, lack of product development and a lack of quality hotels and restaurants. This situation is preventing tourists from spending time and money in the province.

An additional challenge and opportunity regarding the development of tourism in Bokeo is the planned construction of a bridge that will cross the Mekong River and link Bokeo in Lao PDR with Chiang Rai in Thailand. Civil works should be completed and the bridge opened in 2012. It is important to note that once the bridge is built, the ferry service between Chiang Khong district in Chiang Rai province and Houay Xay Town in Bokeo province will be reduced drastically. According to the Bokeo PTD a bypass road will link the bridge to NSEC Route 3 directly, which means travelers would no longer need to pass through Houay Xay Town, which will further reduce travel time between Thailand and China. This can be seen as a disadvantage for both Bokeo province and Luang Namtha because it may result in less visitors stopping in the provincial centers.

Tourism Products and Activities

Although Bokeo is the smallest province in Lao PDR, it has a large number of interesting ethnic groups. One-day visitors usually travel around Houay Xay and visit attractions in town or nearby. Tourism resources and attractions in Bokeo are shown in Table 4.

Some issues that need to be addressed in order to improve these sites for tourism including:

Better tourist information is provided at Bokeo Tourism Office. Interpretive and directional signage for all the sites is needed. The ancient town of Souvannakhomkham needs more maintenance and

restoration. Accessibility is an issue. Historical significance should be interpreted in an effective way. This site also needs to have a management plan.

Lanten Ethnic Village at Ban Nam Chang. A visit to this village has been included in several tour programs without any agreement or approval of the local community. Social impacts (such a children begging) can already be

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seen from mass tourism. Large tour groups stop for a short time in the village, walk around, take pictures, give snacks or money to children then leave. This arrangement is not generating economic or other benefits for the community.

The Old French Army Fort is promoted as an attraction in Bokeo on the internet but in fact it is presently not open to tourists.

A number of visitors who stay overnight in Bokeo participate in “The Gibbon Experience” operated by the private sector in the Nam Kan National Protected Forest. The Gibbon Experience is promoted on several public websites and is quite popular among European tourists. It is an innovative program which provides a rare opportunity to see Black-cheeked Crested Gibbons (once thought to be extinct in Lao PDR) from a network of canopy huts and zip-lines. Overnight accommodation is located in tree houses high above the forest floor with excellent views of the surrounding Nam Kan NPA.

In terms of destination marketing and promotion, the Bokeo PTD has not been very active in promoting activities available in the province. There are very few examples of informational or promotional materials about Bokeo. The few existing pieces of PTD-produced promotional materials include a city and provincial map that marks select attractions, but lacks general tourist information.

Table 4: Existing Tourism Resources/ Attractions in Bokeo ProvinceJom Khao Manilat Temple

Jom Khao Manilat temple was built in 1880 out of teak and is Shan-style, with spectacular painting in bright colours, like sacred places in Jakarta. The temple affords a good view of the town and the Mekong River below, a perfect site especially at sunset. The temple is just a few minutes walk from the ferry pier.

That Pha Kham Temple This is the oldest and an important temple of Houay Xay.

Ethnic village – Ban Khao Pun Many villagers' occupation is to produce 'kao pun' or 'rice vermicelli'.

The kao pun that is made in Ban Khao Pun village is exported to Thailand at Chiang Kong. A number of Thai tour operators include this in the program.

Ethnic village – Ban Yong Hin

Thai Lue Tribe Village features a unique attraction: mobile wooden houses. The Thai Lue people build their houses by placing each stake on top of the stone. The idea is thought to protect their wooden houses from termites rather than for mobility.

Ethnic village – Ban Tom Lao

The name of the village literally means 'distilling alcoholic rice spirits’. Apart from growing rice and working the land, villagers here produce many kind of alcoholic beverages such as Sa Tor and Kasae.

The ancient town of Souvannakhomkham,

Located in Muong Tonpheung district 56 km from Houay Xay. These ruins are the remains of a large city from the 14-16th century. There is a Buddha image of 7.11 meters wide and 7.22 meters high, one of the largest in Laos.

French Garrison French-built, high-walled fortress clearly visible from the opposite side of the Mekong river, Chiang Kong, Thailand. It will be open to visitors soon.

Muang Bokeo Houay Xay market

Muang Bokeo Houay Xay market is located on Saykhong Road, in the southern part of the town. This presents a good opportunity to observe local lifestyles and is a good place to shop for local products at cheap prices. The market sells fish and meat, fresh vegetables, and some household products. This is also the main road-transport depot.

Nature and Caves In Pha-Oudom and Muong Paktha, there are hot spring water, windy hole, water falls, jungle and wild animals.

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Hotels and Restaurants

There are 5 hotels and 28 guesthouses in Bokeo province. Most accommodation establishments are located in Houay Xay district. Existing hotels in Bokeo are quite small, averaging about 20 rooms each. Most accommodation is for budget travelers, offering basic facilities priced from USD 3-15 per night. Tour operators mention that the main reason they do not overnight in Houay Xay/Bokeo is because of a lack of larger hotels of good standard. In 2008 there were 19 local restaurants serving typical local food and simple western dishes. They are mostly located in Houay Xay along the Mekong River. Most of the guesthouses also offer simple food and beverages at reasonable prices.

Table 5: Accommodation & restaurants in Bokeo, 2008

Bokeo Province Number Rooms Beds

Hotels 5 100 172

Guesthouses/ Resorts 28 279 405

Restaurants 19 - -

Source: LNTA 2008 Statistical Report on Tourism in Laos

Summary of All Primary and Secondary Tourist Attractions in the NSEC in Lao PDR Table 6 summarizes the tourism resources and attractions found along the NSEC in Lao PDR. While not all will receive assistance under the STDP, sites that will are discussed in more detail in section 5.

Table 6: Summary of the main tourist attractions along the NSEC

Luang Namtha

Natural Cultural Historic

Nam Ha NPA Vieng Neua Musical Performances Village Luang Namtha museum

Nam Dee Waterfall Pieng Ngam Weaving Village Vat Louang Khone

Nam Eng Cave Nam Dee Village Vat Mahaphot Temple

Bor Kung Springs Chaleunsouk Village That Phoum Phouk

Nam Pae Viewpoint Nam Eng Village That Luang Namtha

Nam Pae Village

Bokeo

Natural Cultural Historic

Nam Kan NPA Lue Weaving in Don Chai Fort Carnot

Nature and Caves in Pha-Oudom and Muong Pakth

Nam Chang Village Ancient town of Souvannakhomkham

Gibbon Experience Ethnic Villages Jom Khao Manilat Temple

That Pha Kham Temple

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4. NEW POSSIBLE MARKETS

Nature-based tourism activities and ethnic minority village visitation offered in Luang Namtha and Bokeo are presently most suitable for backpackers, and young people who seek natural beauty/scenery that prefer trekking and home-stay tours. This market segment is comprised mainly of independent travelers who tend to plan and manage their trips on their own, rather than travel with tour operators. The independent traveler is the presently the primary market for Luang Namtha and Bokeo and should continue to be targeted while reaching for other market segments.

Based on the situational analysis, two markets that should receive additional attention are:

i) Family/leisure groups on package tours from Thailand and China

There are opportunities to capture benefits from this package tour market since tour operators in both Thailand and China are already promoting tourism programs along the NSEC. With convenient land transportation, the region is now much cheaper to visit and more accessible for a wider range of tourists. The challenge is how Luang Namtha and Bokeo can encourage transit visitors to spend more time and money in the area.

ii) Eco-tourists/ adventure tourists from other countries in Asia

Given that nature-based/adventure activities are already the main tourism products in Luang Namtha and Bokeo, there is a need to expand marketing and promotion activities to reach tourism markets in Asia such as Thailand, Korea and Japan as well as to continue targeting the European and North American markets. The Asian market, especially from the GMS region, has strong potential given the short distance for traveling within the region and low cost of transportation to Lao PDR.

Figure 4: Existing and Potential New Markets

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4.1 Family/ Leisure Group on Package Tours from Thailand and ChinaAs explained in the situational analysis, Bokeo and Luang Namtha are experiencing a rapid increase in international arrivals through both Houay Xay and Boten international border checkpoints. These international visitors are mostly Thais and Chinese on package tours.

Currently there are several tour operators in Thailand offering tour programs to the Thai market that travels on the NSEC, bound for Yunnan province in China. This is a popular program since Sipsongpanna (Xishuangbanna), China is a sought after destination for the Thai market. Characteristics of Thai visitors on package tours to Sipsongpanna are as follows:

Travel for leisure and holiday Groups of elderly people or family groups with a mixture of different ages Generally not interested in trekking or adventure tourism activities Food, eating and shopping are popular activities Not familiar with staying at home-stay accommodation in villages Require good quality services and facilities such as accommodation,

restaurants and restrooms.

Given the characteristics of the Thai package tour market, existing tourism products and activities in Bokeo and Luang Namtha do not match this market’s needs. As a result, Thai tour operators hardly include any sightseeing activities in Lao PDR and prefer to drive straight to Boten border checkpoint in order to get to Yunnan province as quickly as possible. This situation does not create any economic benefits for local communities along the NSEC in Lao PDR.

Table 7: Examples of existing programs offered by tour operators based in Thailand.

Name of Tour Program No. of days Activities in Bokeo/ Luang Namtha

Price (Baht)

1 Xishuangbanna – Chiang Khong – Houay Xay – Chiang Rai – Vieng Phoukha

3 days 2 nights Lunch at Luang Namtha district (Heuan Lao Restaurant)

Shopping Duty Free

6,990

2 Friendship Route of Thailand – Lao PDR – China: Xishuangbanna

4 days 3 nights Lunch at Luang Namtha

Overnight at Boten (Royal Jinlun Hotel/ Casino Hotel)

20,000

3 Chiang Rai – Chiang Khong – Boten - Xishuangbanna

5 days 4 nights Coffee at Nam Fa

Lunch at Boten (Royal Jinlun Hotel/ Casino Hotel)

15,900

4 Chiang Rai – Chiang Rung – Xishuangbanna

6 days 5 nights Lunch at Luang Namtha

Drop by Vat Luang

-

5 Xishuangbanna – Bohan – Luang Namtha – Vieng Phoukha – Houay Xay -Bokeo

5 days 4 nights Drop by Nam-Khok village

Lunch at Luang Namtha district

13,900

6 Chiang Rai – Chiang Khong – Houay Xay – Luang Namtha – Xishuangbanna

4 days 3 nights Lunch at Luang Namtha district (both ways)

12,900

7 Chiang Rai – Chiang Khong – Boten –

5 days 4 nights Coffee at Nam Fa

Lunch at Boten (Casino Hotel)

15,900

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Name of Tour Program No. of days Activities in Bokeo/ Luang Namtha

Price (Baht)

Xishuangbanna

Tour programs along NSEC offered by Thai tour operators always use the names “Houay Xay”, “Vieng Phoukha” and “Luang Namtha ” as destinations on their tours as a selling point. There are actually no activities offered at these destinations – the tour groups usually just drive through appreciating the scenery and sightseeing from their vehicles without stopping. These programs have some common characteristics: 4 days 3 nights or 5 days 4 nights traveling from Chiang Rai (Chiang Khong

border checkpoint) crossing Mekong River to Bokeo (Houay Xay border checkpoint) then on R3 passing Luang Namtha to Boten border checkpoint to Yunnan province in China

No tourism activities at Bokeo or Luang Namtha are included in the program - are activities are in Yunnan province of China

Some programs stop at Ban Nam Fa for coffee because it is the one stop on R3 that has 2-3 local restaurants and restrooms

Some programs stop for lunch at a restaurant operated by a Thai entrepreneur in Luang Namtha Town on the way to and from China

Some stay overnight at the hotel/casino near the Boten border checkpoint, which is owned by Chinese investors

Based on interviews with 20 Thai tour operators, issues and reasons for not including any tourism activities in Bokeo and Luang Namtha are as follows:

Most Thais who buy this program and travel with tour companies are elderly people or family groups who travel for leisure and holidays. This market is not interested in nature-based activities

Target tourists prefer to spend more time in Yunnan province of China due to its attractive tourism products, services and activities. Existing attractions in Bokeo and Luang Namtha are not attractive to this market

Tour operators are not aware of what to do and see in Bokeo and Luang Namtha provinces

Accessibility to tourist attractions in Bokeo and Luang Namtha province is seen as an issue. There is a Lack of signage and information centers to promote tourist attractions

Limited quality tourism facilities in Luang Namtha such as accommodation and restaurants that can accommodate a big group of tourists. This is the reason why tour operators use only select hotels/restaurants that are generally owned or operated by Thais and Chinese, not Lao investors.

Lack of rest stops with facilities such as restrooms, local product/handicrafts shops and parking space for big buses. Based on tour operators’ experience, it is good to stop along the way every 2 or 2.30 hours since tourists do not enjoy sitting for a long time. If there were more rest areas along R3, this could help extend the length of stay and opportunities to generate economic activity in the area.

Safety and security concerns. Existing tour programs have a very tight schedule and are very much focused on

Yunnan province of China. If they extend time in Bokeo or Luang Namtha, which means they will have to stay overnight since the border checkpoint closes at 5 or

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6 pm. Given a lack of sufficient accommodation to accommodate large tour groups, tour operators will probably decide not to spend any time in Lao PDR.

A negative past experience with border facilities and tourism services, for example, unreliable booking with hotels in Luang Namtha.

4.2 Nature-based tourists/ adventure tourists from other countries in AsiaSince natural resources and nature-based activities are the highlights for Luang Namtha and Bokeo, nature-based visitors should be continuously targeted as a priority market. Target countries could be expanded from Europe, Australia and North America to other countries in Asia. When looking at priority markets for tourism in Lao PDR as identified by LNTA, Thailand and Japan are the two identified priority Asian markets.

Table 8: Existing nature-based programs in Lao PDR offered by Thai tour operatorsTour

Operators Nature of Package Tours Programs No. of Days

1 Trekkerhut Tailor-made program (minimum 5 people)

Chiang Khong - Houay Xay – Luang Namtha - XishuangbannaChiang Khong - Houay Xay – Luang PrabangMost of the programs are in Luang Prabang. Some are in Vang Vieng and Plain of Jars.

4 days3 nights

2 Trekking Thai

Nature-based activities/ trekking

12 people minimum

Chiang Khong - Houay Xay – Luang Namtha – Xishuangbanna (stay 1 night in Luang Namtha)Other programs are in Champasak, Vang Vieng and Luang Prabang.

5 days 4 nights

3 Prai Kwang Tour

Suitable for those interested in trekking activities and nature-based activities.

30 people minimum Stay at resort (not homestay)

Chiang Khong - Houay Xay – Luang Namtha - XishuangbannaOther programs are in Luang Prabang and Champasak

6 days5 nights

4 Swan Travel Nature-based activities but not too difficult

15 people minimum

Chiang Khong - Houay Xay – Luang Namtha – Xishuangbanna

5 days4 nights

5 Double Enjoy

Small group of 8-9 people Big group of 40 people Nature-based/ adventure

tourism activities

Chiang Khong - Houay Xay – Luang Namtha - Xishuangbanna

6 days5 nights

6 Tong-Phun Focus on university students and those who enjoy eco-tours

36 people

Chiang Khong - Houay Xay – Luang Namtha - Xishuangbanna

6 days5 nights

7 Fourlens Foreigners Nature-based activities/

trekking Could be from 10-40 people

There are 38 programs in Lao PDR. Four programs pass through Bokeo and Luang Namtha to China.

4 days 3 nights

8 Trip and Trek

8 people minimum Trekking activities and ethnic

culture

No program in Luang Namtha or Bokeo but in Vang Vieng, Luang Prabang, Plain of Jars

4 days 3 nights

9 Backpack-tripper

10 people minimum Not over 20 people/ group Nature-based activities

No program in Luang Namtha or Bokeo but in Vang Vieng, Luang Prabang, Plain of Jars

Range between 3-7 days

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Tour Operators Nature of Package Tours Programs No. of

Days10 Nak Dern

Tang (Travelers)

7-8 people Adventure tourism

Only one program in Lao PDR: Vang Vieng – Luang Prabang

4 days 3 nights

In the case of Thailand, currently there are a number of small tour operators that offer trips for small groups of people who enjoy nature, nature-based and adventure activities. This kind of nature-based package tour is focused on the younger generation, youth and those who are interested in backpacker-type tourism. Some of the tour operators offer tailor-made trips so customers can choose a destination and the company then works to get a minimum number of people on the trip to keep costs down.

These programs tend to provide quality learning experiences and focus on small group experiences. Given the growing popularity for nature-based tourism among the Thai market, there is an opportunity to increase visitation among this market segment. To do so requires better coordination with Thai tour operators to reach this priority market and promote the quality tourism products that Luang Namtha and Bokeo have to offer.

5. IDENTIFICATION OF NEW TOURISM ACTIVITIES ALONG R3

Offering a variety of choices along the NSEC such as local community products, arts and crafts, shopping areas and adequate facilities would generate interest in the area and provide tourists with an opportunity to learn about the area’s natural, historic and cultural heritage. This section identifies potential new tourism products and services to be developed in order to encourage visitors from Thailand and China to extend their length of stay along the NSEC and appreciate its cultural, historic and natural resources.

5.1 STDP Identification of Tourism Products along NSEC R3Prior to this study, the STDP Team identified possible sites to be developed and promoted along the NSEC. There are 8 primary and 3 secondary sites identified – in total, 8 in Luang Namtha province and 3 in Bokeo province. The location of primary sites (site 1-8) and secondary sites (3 villages) is highlighted in Figure 5. Proposed infrastructure and facility development at the primary sites is shown in Table 9. Detailed architectural drawings that show planned infrastructure and civil works for each site can be found in Part III of this report.

Table 9: Primary tourist attractions to receive STDP assistance, 2009 - 2014

Luang Namtha

1. Construction and outfitting of the Nam Ha National Protected Area Visitor Center in Luang Namtha district, Luang Namtha province.

2. Improvements to the Night Market in Luang Namtha district, Luang Namtha province.3. Improvements to the Nam Eng Cave in Vieng Phoukha district, Luang Namtha

province.4. Improvements to the Khou Vieng Archaeological Site in Vieng Phoukha district,

Luang Namtha province.5. Improvements to the Bor Kung Spring Nature Park and construction of a small

Exhibition Center on Ethnic Arts and Culture in Vieng Phoukha district, Luang Namtha province.

6. Improvements to the Nam Pae Scenic Viewpoint in Vieng Phoukha district, Luang Namtha province.

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Bokeo

7. Construction of a Tourist Service Center and Nam Kan Protected Area Information Center in Houay Xay District, Bokeo province.

8. Improvements & Interpretation at the Old French Army Garrison in Houay Xay District, Bokeo province.

Figure 5: Location of tourist sites that will receive STDP assistance, 2009 – 2014

In addition to the main sites identified above, the STDP project will assist communities to develop and strengthen existing community-based tourism activities at the Nam Dee Waterfall and Ban Vieng Neua Cultural village in Luang Namtha and the Ban Nam Chang Cultural Village in Bokeo. Nam Fa Village in Houay Xay District and Tor Lae Village will receive CBT support under another component of the STDP.

If resources are not sufficient to support planned activities at all primary sites on the NSEC, the STDP plan is to eliminate some proposed improvements at Vat Mahaphot in Vieng Phoukha.

Based on the survey teams visit to the primary sites shown in table 9, there are concerns and issues regarding identified sites as well as recommended actions for each site. These concerns are summarized in table 10.

Table 10: Recommendations for STDP supported sites on the NSEC

Site STDP Plan for Facility Development Issues/ Concerns Recommended Actions

1. Luang Namtha Town

Improve night market

Provide interpretation

- -

2. Nam Ha Construct visitor This is a strategic location for Provide capacity

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Visitor Center & Market

information center

Construct a market with dining area

Construct parking area and restrooms

package tours to stop

There needs to be a clear understanding of what the proposed local products market is for. If its objective is to sell local products to tourists, there will be a need for product development in order to meet the demand.

It is unclear to how the site will be operated and maintained in the long term.

Since the site is close to Chaleunsouk village, social impacts from tourism will have to be monitored.

building program on tourism for Chalensouk village in order to get ready for mass tourism.

Need to provide assistance to improve local products in terms of quality and design.

Operation and maintenance plan for visitor center should be in place.

3. Nam Eng Cave and Picnic Area

Construct elevated walkway 100 – 200 meters inside the cave

Construct a market, ticket booth, parking area, restrooms and picnic area at the area along the road


Environmental impacts on the cave could be an issue.

Involvement of Nam Eng community in tourism development at this area should be clearly determined.


Conduct environmental impacts assessment on the cave before final decision on walkway construction.

Provide capacity building program on tourism for Nam Eng village in order to get ready for tourism.

Identify local products that will be sold at the market.



4. Vat Mahaphot Historic Site (in Vieng Phoukha)

Construct parking area, ticket booth, restrooms at the area along the road


Condition of historic site is not ready for tourism. The provincial office on information and culture has a restoration plan but has not implemented it due to budget constraint.

Facility/infrastructure should not be developed until the site has been secured and management plan in place.

Provide budget for site restoration and management.

As this is a sensitive site, interpretive media such as sketch drawings/ 3D could be developed to interpret historic significance.

5. Bor Kung Spring Nature

Construct 3 spring baths at site

The issue of “what the development of spring bath is for” should be discussed.

Need to identify target market and assess if such development

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Park (in Vieng Phoukha)

Construct a market, ticket booth, parking area, restrooms at the area along the road

Construct restaurant with information displays

Prepare camping area

Create walking track

Construct pedestrian bridge

international package tours are unlikely to be attracted to spring baths, but local people, backpackers and the domestic market is.

It is not clear who the target market is for proposed camping area and canopy walkway.

matched with target market demand.




6. Nam Pae View Point

Construct Sala view point

Construct a market, parking area, restrooms at the area along the road


This is a very good location for a viewpoint. However, the viewpoint location is opposite to Nam Pae village. If not properly managed, there is a possibility for negative tourism impacts for Nam Pae village.

There needs to be a clear understanding of what this market is for and what kind of products will be sold here. There is a need to diversify products at each stop on the NSEC and forecast visitation at each site.


Provide capacity building program on tourism for Nam Pae village in order to get ready for tourism.




7. Nam Kan Visitor Center and Don Chai Market

Redesign existing local shops in Don Chai Market

Prepare dining area

Construct handicraft demonstration center

Construct visitor information center in the area of the market

Construct parking area and restrooms

This is a strategic location for package tour to stop by.

Handicraft products of Don Chai village have better quality and design compared to other communities along the route. It is feasible that the group tour would drop by for a rest and shopping.

Need to provide introduction to NSEC tourism and information on attractions along the route.


8. Old French Army Fort

Clean up the site/ clear all vegetation in the army fort

Restore the buildings and foundations


Condition of historic site is not ready for tourism. The provincial office on information and culture has a preliminary restoration plan but has been trying - and failing - to find external

Provide budget for site restoration and management.

Interpretive media such as brochure, sketch drawings/ 3D could be

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Construct ticket booth, souvenir shop, parking area and restrooms.

funding to carry out restoration.

There needs to be site restoration and management before being opened to visitors

developed to interpret historic significance.

5.2 Recommended New Tourism Products and ActivitiesThe best known tourism activity in Luang Namtha and Bokeo provinces is visiting and experiencing natural resources/national protected areas and participating in adventure activities. If Luang Namtha and Bokeo provinces are to diversify their tourism products in order to attract new market segments such as Thai and Chinese on package tours along NSEC, it is important to carefully determine what the preferences of these two markets are.

Table 11: Target markets for proposed STDP sites

SiteLocation Target Market

District Province Visitors on Package Tours

Individual Travelers/ Domestic Tourists

1. Night Market Namtha Luang Namtha

If the groups sleeps in Luang Namtha

2. Nam Dee Waterfall & Village

Namtha Luang Namtha

3. Ban Vieng Cultural Village

Namtha Luang Namtha

4. Nam Ha Visitor Center & Market

Namtha Luang Namtha

5. Nam Eng Cave and Picnic Area

Namtha Luang Namtha

For some groups

6. Vat Mahaphot Historic Site

Vieng Phoukha

Luang Namtha

After restoration and effective interpretation

7. Bor Kung Spring Nature Park

Vieng Phoukha

Luang Namtha

8. Nam Pae View Point

Vieng Phoukha

Luang Namtha

9. Nam Kan Visitor Center and Don Chai Market

Houay Xay Bokeo

10. Ban Nam Chang Cultural Village

Houay Xay Bokeo

If properly planned and managed for cultural-related

activities

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SiteLocation Target Market

District Province Visitors on Package Tours

Individual Travelers/ Domestic Tourists

11. Old French Army Fort

Houay Xay Bokeo

After restoration and effective

interpretation in place

All of sites identified in table 11 appear suitable for domestic tourists or individual travelers but not all will appeal to visitors on package tours. There is a need for discussions with tour operators to determine if the proposed STDP supported sites are matched with their market and clients from Thailand and China. A Possible sample itinerary that includes STDP supported sites are shown in Table 12.

Table 12: Sample itinerary including proposed STDP sites

Sample Itinerary

0800 Leave Chiang Khong border checkpoint - cross Mekong River

0830 Arrive at Houay Xay border checkpoint

0900 Visit Old French Army Fort

1130 Visit Nam Kan Visitor Center at Don Chai Market

Lunch at Don Chai Market

1330 Nam Pae View Point

1430 Nam Eng Cave

1600 Visit Nam Ha Visitor Center

1730 Arrive at Boten border checkpoint to Yunnan Province, China

Apart from attractions identified by the STDP Team, ethnic diversity and indigenous knowledge, a valuable part of the cultural heritage of Luang Namtha and Bokeo, should be promoted. Culture-related activities could help to enhance visitor experience, educate visitors thereby provide a better understanding and appreciation of local culture, traditional clothing, livelihood systems, authenticity, religious beliefs and festivals. Bokeo Social Enterprises in Houay Xay are developing an ethno-botanical garden that will be open to visitors to learn about traditional medicine. It is expected that it will be open in 2-3 years.

In addition to the sites highlighted in previous sections of this report, other possible tourism products and activities that can be promoted along NSEC are:

Ethnic cultural events/ festivalsPromotion of cultural events could provide an important means for reviving and preserving local cultural practices as well as a source of employment and additional income.

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Festivals such as New Year’s celebrations of the Lanten, Yao, Tai Dam, Khmu, Hmong and Sida in December/ January are normally open to the public and should be included and promoted to tourists. There is a need to interpret stories related to festivals so visitors have a better understanding and appreciate of the differences between each ethnic group’s festivals.

There are a number of other ethnic events and festivals related to daily life and conducted according to traditional practices. Some could also become part of visitor’s experience, while some are not suitable for tourism products. Local communities should determine which events and activities they are willing to share with tourists and which ones they are not. If they choose to open some ethnic/ spiritual events for tourism, it is recommended that at first visitation is small scale in order to avoid lessening their significance and authentic cultural expression. If communities choose not to invite visitors to join religious festivals their decision should be respected by tour operators and tourists.

Handicraft demonstrations in the villageArts and handicraft-making demonstrations by local communities could be an interesting and educational experience for tourists. Increased understanding of the indigenous knowledge used in producing handicrafts may induce tourists to make more purchases.

Handicrafts produced by local communities include cotton textiles by Lanten and Akha, bamboo basketry by the Khmu and bamboo paper by the Lanten and Yao. At present, handicrafts are produced mainly for local or family use only. If handicraft-making processes are to be demonstrated to visitors, the PTD should work with select communities to determine how and when they wish to conduct demonstrations and how many visitors the community can accommodate. In order to avoid negative impacts on the local community, village visitation will have to be well-planned and organized before being promoted to large audiences.

Handicraft Center Since handicrafts produced by the local community are generally for home use and not offered for retail sale, some may not meet tourist demands in terms of the design, quality, size and price. Presently customers are increasingly sophisticated and are looking for something unique. In order to provide opportunities for the local community to sell handicrafts to tourists at markets planned by the STDP, there must be assistance provided to improve design, branding, packaging and promotion. It is recommended that professional designers help to suggest improvements to local designs and quality while still retaining traditional skills, techniques and use of local materials.

Cooking classesCooking classes focusing on preparation of local food might be interested to eco-tourists or independent travelers. There is a variety of food preparation techniques practiced by the many ethnic groups living along the NSEC that can be shown to visitors.

Agriculture toursGiven that agriculture is the main occupation for ethnic minorities along NSEC, agro-tourism is one possible activity that could involve villagers in the demonstration of farming techniques and traditional production process. Agriculture tours need to be well-planned and organized effectively so they do not disrupt farmers’ activities without benefiting them. Timing is also important, as tours need to be planned in such a way that fits with the local agricultural cycles.

Educational tourism in the community

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Tours to ethnic communities that involve students and researchers and students are becoming increasingly popular, but arranging such tours requires specialized tour agents and cooperation from the local authorities. Educational tourism can be a lucrative and low impact activity for communities if adequate preparation work in done and the village is presented with opportunities to provide visitors with services such as food lodging and interpretation. An example of an organization that sends educational tours to Laos is Where There be Dragons. (www.wheretherebedragons.com)

6. STRATEGIES AND ACTION PLAN TO CAPTURE MORE BENEFITS FROM NSEC TOURISM

In order to encourage visitors to stay longer and spend more at destinations along NSEC, four strategies are recommended including; (i) diversification of tourism products; (ii) effective branding and marketing; (iii) innovative communication and promotion and; (iv) provision of visitor infrastructure and facilities.

Figure 6: Strategies for NSEC Tourism Development

6.1 Diversification of Tourism ProductsAs discussed earlier in Section 5, nature-based tourism will remain a major attraction for the NSEC, but the destination should be positioned to appeal to larger audiences based on the ease of experiencing both nature and ethnic diversity. This will allow Bokeo and Luang Namtha to appeal to and capture new market segments. It is therefore recommended that new tourism products and activities focus on promoting the ease of experiencing the area’s authenticity, nature and unique ethnic culture to regional markets. At the same time, the expansion of nature-based tourism and adventure tourism should continue, based on established models as practiced by companies like Green Discovery, The Gibbon Experience and the smaller Eco-guide Services found in Luang Namtha.

Recommended Actions - For new ethnic/cultural products and activities

Work with the 7 communities of Nam Chang, Nam Pae, Nam Eng, Chalensouk, Nam Dee, Vieng Neua and Don Chai to develop community-based tourism activities and local markets that can source produce and handicrafts from surrounding villages.

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http://www.wheretherebedragons.com/

Provide technical assistance/ capacity building program to potential communities on tourism planning and management. For example:

- Introduce sustainable community-based tourism concepts and guidelines.

- Assist communities to organize service and management groups to decide on goals and objectives from tourism development and manage tourism in their communities

- Identify more tourism products and activities (in addition to the 7 proposed above)

- Package tours so they can be included in regional tour programs

- Determine how to best manage visitors while they are in villages

- Determine income generation and income distribution schemes

Closely work with the community during implementation process and provide advice when necessary.

Once the community is ready, introduce new possible products to tour operators. Provide relevant information to operators so they understand the rules for visiting the village and have accurate expectations.

Collect and analyze visitors’ comments and suggestion for further improvement.

Figure 7: Existing and Possible Tourism Products and Activities

Recommended Actions – For improving existing attractions

Improve proposed sites to be more attractive in order to enhance the visitor’s experience with an aim to encourage them to stop, stay longer and promote spending opportunities at each site. For example:

- Restoration of historic sites such as Vat Mahaphot/Khou Vieng archaeological site in Luang Namtha province and Souvannakhumkham archaeological site in Bokeo.

- Redesign interpretation and exhibits at Luang Namtha museum to be more interesting.

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- Develop a story to be told at each site and provide interpretative signage.

- Install directional signage at all sites.

Develop and promote options for half-day, 1-day and 2-day day itineraries in Bokeo and Luang Namtha. This could help visitors to manage time on their trip more easily and help to extend visitation along the NSEC and possibly to other parts of the provinces.

6.2 Innovative CommunicationTelling stories about local culture and customs, stories about the environment and local history is an important tool for conservation, education and economic development. Various stakeholders should work together to identify how they would like the NSEC’s tourism assets to be portrayed. Educating visitors through effective communication can help minimize negative impacts on the site and local culture and maximize local benefits from tourism. Messages should combine a promotional aspect with information on how to be sensitive to local customs.

A wide range of interpretive techniques in multiple languages should be used to communicate messages to visitors. Printed media should include guidebooks, maps, information center displays, brochures and signage. Electronic media including websites, promotional videos and press releases on local festivals and new developments should be produced and distributed to target markets.

Recommended actions

Design displays introducing tourism assets on the NSEC

It is recommended that displays are designed to provide an orientation to visitors and introduce them to tourism activities in Bokeo and Luang Namtha provinces. Displays should be located at the Houay Xay border checkpoint in Bokeo and the Boten border checkpoint in Luang Namtha since they are entry points from Thailand and China. Displays can also be located at the bus stations and airports at each province. Their content should include a map of the 2 provinces with NSEC attractions and facilities, information on natural resources and ethnic culture, and brief information about specific sites along the NSEC.

Develop a brochure for NSEC tourism

Brochure can be designed to present the highlights of the Bokeo and Luang Namtha provinces, attractions along the NSEC, ethnic communities and facilities. It is recommended that brochure be made available for visitors at key points in both provinces and should be downloadable from the website.

Design interpretive and directional signage

Presently there are hardly any interpretive and directional signage at attractions in Bokeo and Luang Namtha. It is proposed that uniform signage for sites and attractions is installed, especially at sites along the NSEC.

Improve existing websites

Many visitors make their decisions about where to visit after obtaining information from the internet. NSEC corridor web pages should be created with maps and a brief description of each attraction along the roadway, downloadable brochures and

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general tourist information such as accommodation, restaurants, services and facilities.

This information should be included on the existing website of Luang Namtha and on the LNTA’s websites. Bokeo does not currently have a province-specific website and requires technical assistance to create one.

Improve interpretation at the existing information centers

Presently Bokeo does not have an information center (currently under renovation, due to open again in October 2009) while Luang Namtha Province has centers in Luang Namtha Town, Vieng Phoukha and Muang Sing. Information presented in the information center at Luang Namtha is mostly on trekking and ecotourism activities. It is recommended that information at the Luang Namtha information center is widened to include more information for transit visitors and information on NSEC attractions.

6.3 Provision of Visitor Infrastructure and FacilitiesThe construction and maintenance of most services and facilities such as accommodation, restaurants, rest areas, gas stations, parking spots and restrooms are directly related to the comfort and enjoyment of visitors while they are traveling along the route. Tourism infrastructure and facilities present a good investment opportunity to the private sector and will be promoted as part of this Strategy.

Recommended Actions

Rest areas

It is recommended that the private sector be encouraged to develop additional rest areas along the NSEC. The STDP will build three model facilities at Ban Chalensouk, Bor Kung and Ban Don Chai, but with the expected growth in traffic there will be many more opportunities for investment in facilities such as parking space for buses, clean restrooms, local restaurants, shops for visitors to buy drinks, snacks and local products.

Accommodation

One of the reasons tour operators do not spend the night in Luang Namtha is the lack of hotels that can accommodate groups of tourists numbering 30-40 people or more. The STDP will therefore promote investment in larger hotels in Luang Namtha Town and nature resorts with 10 – 30 rooms in smaller destinations like Vieng Phoukha.

Restaurants

To better serve transit visitors, the STDP will promote investment in restaurants along the NSEC and will support public-private partnerships in Bor Kung, Ban Chalensouk and Don Chai to construct and operate restaurants offering authentic Lao food and ethnic products.

Souvenir shops

There are very few souvenir shops or local product shops either in Bokeo or Luang Namtha where visitors can spend money. It is recommended that there should be handicraft centers where local products sourced from local communities can be distributed and sold to tourists.

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6.4 Effective Branding and MarketingIt is recognized that Luang Namtha and Bokeo have an outstanding tourism product to offer tourists seeking conservation-oriented nature and culture-based experiences. In addition, the destination is perceived as peaceful and relaxing. The NSEC brand image should be built around the core values including the enjoyment of scenery and nature, protecting and conserving the environment and culture, encounters with authentic local cultures, relaxation and exploration3.

Figure 8: Core Values for Brand Image

A slogan or symbol that links the elements in figure 8 will be created to generate broad recognition of the destination in target markets. As of August 2009, the NSEC preliminary tourism-brand (and slogan is:

Mekong & MountainsExplore Life & Nature in Northwest

LaosIt is recommended that branding experts should be involved to further develop a brand for NSEC tourism and there is a clear understanding that the brand is for Luang Namtha and Bokeo provinces as a single NSEC destination.

A Marketing and Promotion Action Plan for the NSEC (2010 – 2015) is presented in Table 13. This plan is based on the assumption that all STDP-supported tourism infrastructure and facilities will be built during 2010-2011 and the project’s

3 Sourced from the Luang Namtha Marketing Strategy, 2007

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community support programmes will run from 2009 – 2014. This plan is informed by the Luang Namtha ’s Marketing Strategy (2007) that aims to maintain the province’s position in its primary market of eco-tourists and expand to new markets. The following actions are relevant to both Luang Namtha as an individual province and Luang Namtha & Bokeo as a NSEC “single destination”.

1) Continue marketing the tourism product as a combination of nature and culture with a strong focus on conservation and protection

2) Increase targeted communication in selected markets 3) Present NSEC tourism products to international and regional clients4) Coordinate with public and private sector on marketing initiatives5) Coordinate with Thailand and China for cross border initiatives

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Table 13: Marketing and Promotion Action Plan for the NSEC, 2010 – 2015Action Plan 2010 2011 2012 2013 2014 2015

1 Market the NSEC tourism product as a single destination with a focus on nature, culture and conservation Create short and meaningful messages and

attributes to describe tourism in Luang Namtha and Bokeo as part of NSEC tourism experience.

Develop NSEC destination brochure/guidebook and translate into relevant languages.

Add NSEC tourism information to the existing Luang Namtha website. Develop a website/web-pages for Bokeo

Organize high profile environmentally friendly events (e.g. running, cycling, rafting) and cultural festivals.

2 Increase targeted communication in selected markets Send specific information packages on tourism

along NSEC to tour operators in Thailand and China that currently offer the package tours there.

Develop brochures, flyers and poster for new markets and special interest groups.

Work with travel media and press in target markets (European, North America, Australia/ New Zealand, Thailand, China and Japan). Self-promote the arwa using YouTube and other web 2.0 tools

Contact selected journalists with information about new tourism products and activities.

Coordinate with tour operators specializing in nature, nature-based tourism, adventure travel etc. in Asian countries such as Thailand and Japan.

3 Present the tourism offer and products to international clients Attend international conferences to

present/publicize NSEC tourism products. Contact and send information to leading travel

websites, in particular responsible travel, sustainable travel, nature and conservation etc.

Organize familiarization trips for eco-tour operators in Thailand and possibly Japan.

Organize familiarization trips along NSEC to tour operators and media in Thailand and China.

Participate in trade shows in Thailand and China4 Coordinate with public and private sector on

marketing and promotion initiatives Cooperate with LNTA and assure that NSEC

tourism (Luang Namtha & Bokeo) is mentioned and included in all marketing tools.

Promote NSEC tourism at the airport, bus station, border checkpoints, and museum.

Work with private sector in Luang Namtha and Bokeo to promote NSEC tourism at hotels, guesthouses, restaurants, local shops and tour companies.

5 Coordinate with Thailand and China for cross border initiatives

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Action Plan 2010 2011 2012 2013 2014 2015

Develop joint marketing and promotion initiatives for NSEC tourism with Chiang Rai, Thailand and Yunnan, China.

7. PRELIMINARY VISITOR FORECASTS

This section provides preliminary visitor forecasts for Luang Namtha, assuming effective implementation of the overall strategies and actions proposed in this study. Forecasts consider the two market segments: visitors that stay overnight in Luang Namtha and transit visitors that are assumed to be traveling on route 3 for at least part of their visit to Lao PDR.

Forecasts are calculated using data for Luang Namtha only because of reliability of existing data, more accurate information on spending trends and length of stay, and the fact that if a visitor travels on route 3 while in Luang Namtha, the person would also pass through Bokeo.

7.1 Average Annual Growth Rate during 2004-2008The existing data on the number of international visitors in Luang Namtha province during 2001-2008 generated from LNTA reports does not differentiate between visitors who stay overnight in Luang Namtha and transit visitors. There is also no official data available on spending, length of stay and arrivals in individual market segments. Therefore, this set of data from 2001-2008 can only generate an average annual growth for overall tourism in Luang Namtha. It cannot be used to generate an average annual growth rate for each market segment.

The Luang Namtha PTD has started to collect information on the actual number of visitors who stayed overnight in Luang Namtha province for the last 2 years (41,000 visitors in 2007 and 63,200 visitors in 2008). As a result, the growth rate for visitors stayed in Luang Namtha and transit visitors can be calculated for during 2007 – 2008 only.

Table 14: Growth rate of visitors staying overnight in Luang Namtha & transit visitors4

Total number of visitors

(from LNTA 2008)(i) Visitors stayed in Luang

Namtha (ii) Transit Visitors

No. of total

visitors

Overall growth rate

No. of visitors who stayed in Luang

Namtha

Annual growth rate

No. of transit visitors

Annual growth rate

2001 41,704 - N/A - N/A -

2002 19,319 -53.68 N/A - N/A -

2003 29,720 +53.84 N/A - N/A -

2004 41,658 +40.17 N/A - N/A -

2005 49,258 +18.24 N/A - N/A -

2006 47,788 -2.98 N/A - N/A -

4 Notes: * These numbers were gathered by Luang Namtha Provincial Tourism Department.

** These numbers are calculated from using the total number of visitors deducted from the number of visitors that stayed in Luang Namtha.

*** The number during January – June 2009 was gathered by Luang Namtha PTD.

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2007 88,427 +85.04 41,000* - 47,427** -

2008 197,202 +123.01 63,200* +54.15% 134,002** +182.54%

2009Approx. 26,000***

(during Jan-Jun’09)

7.2 Growth projections and benefits accruing from effective implementation of the strategyIt is noted that given the time necessary for planning as well as implementation (during 2010-2011) project investments are not seen produce measurable impacts until the year 2012. This strategy targets increased spending from the likely baseline of less than US$ 1 per-transit visitor in 2009 to US$ 1 in 2012 with annual incresses of US$ 1, reaching US$ 4 2015. Among overnight visitors, spending is expected to increase by US$1 per annum in 2012 (from the baseline of US$ 20 in 2008) and with length of stay among overnight visitors increasing by approximately 0.2 nights beginning in 2012, reaching a total of 6 nights by 2015.

i) Visitors staying in Luang Namtha (Primary Market) Without effective market research data, and with a short period of data gathering, which in itself is not reliable, it is very difficult to accurately project growth rates. This Strategy assumes that the destination will maintain its primary market of long-haul international visitors and expand its market share from other Asian countries such as Thailand and Japan.

Since the number of visitors to Luang Namtha gathered by Luang Namtha Provincial Tourism Department (PTD) for the period of January - June 2009 is approximately 26,000, it is assumed that the total number of visitors to Luang Namtha for 2009 will be more or less the same as 2008, which was approximately 63,200 visitors.

The forecasts in table 15 are based on what will likely be a realistic tourism situation taking into account the global economic downturn and uncertainties as follows:

The number of visitors in 2009 is at the same as 2008 10% increase in number of visitors for 2010-2011 which is still optimistic given

the economic crisis. Growth increases to 15% annually in 2012 Length of stay remains steady at 5 days during 2010-1011 (plan

implementation period) Spending remains the same at 20 USD during 2010-2011 (plan

implementation period) Length of stay begins increasing by slightly over 0.2 days per-annum in 2012 Spending increases by US$ 1 per-annum in 2012

Table 15: Arrival, spending and length-of-stay forecasts for overnight visitors during 2009-2015

Year

Primary Market

Number of Visitors staying in Luang

Namtha

Average Length of Stay (day)

Average Daily Spending in USD

Total Spending in USD

2007 41,000

2008 63,200 5 20 USD 6,320,000

2009 63,200 5 20 USD 6,320,000

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201069,520 5 20 USD

6,952,000

2011 76,472 5 20 USD 7,647,200

2012 87,943 5.2 21 USD 9,603,353

2013 101,134 5.4 22 USD 12,014,745

2014 116,304 5.6 23 USD 14,980,001

2015 133,750 6 24 USD 19,260,001

ii) Transit Visitors Given that the annual growth rate in transit visitors during 2007-2008 was extremely high (182.54%), projecting future rates from this baseline would generate unrealistic numbers of transit tourists during 2010-2015. Again, due to the lack of long-term data, it is difficult to generate appropriate average annual growth rates, or establish a reliable baseline for forecasting.

Therefore, the strategy proposes forecasts for transit visitors based on a realistic tourism situation taking into account the global economic downturn and uncertainties as follows:

The number of transit visitors in 2009 will be at the same rate as 2008. A 10% increase in number of visitors for the year 2010-2011 (given the

economic crisis). During the years 2012 – 2015 transit visitors increase by 20% annually with

effective implementation of the strategy Transit visitors each spend on average, US$ 1 while in Lao PDR in 2012.

Spending increases by $1 annually between 2013 and 2015.

Table 16: Arrival, spending and length-of-stay forecasts for transit visitors, 2009-2015

YearTransit Visitors

Number of Transit Tourists

Average Length of Stay (day)

Average Spending in USD

Total Spending in USD

2007 47,427 0 - -

2008 134,002 0 - -

2009 134,002 0 - -

2010147,402 0 - -

2011 162,142 0 - -

2012 194,570 0 1 USD 194,570

2013 233,484 0 2 USD 466,968

2014 280,181 0 3 USD 840,544

2015 336,217 0 4 USD 1,344,870

It is recommended that there needs to be annual revision of this forecast by using the actual number of transit visitors, spending patterns, and an investigation of whether or not transit visitors are moving into the “overnight visitors” category, in order to begin to understand the trend of tourism growth for this market.

The forecast arrival numbers in table 16 are considered reasonable based on growth trends experienced in the Lao province of Savannakhet. Here, the East-West

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10% growth

10% growth

Economic Corridor that links Thailand and Viet Nam saw the number of tourist arrivals (mostly transit visitors) increase from approximately 120,000 in 2004 to 475,000 in 2008. 5

8. BENEFICIARIES

The STDP’s monitoring and evaluation protocol6 will measure the outcomes of this Strategy at project completion in 2014. A separate evaluation will need to be performed in 2015 to determine if forecasts shown in section 7 are met. Tables 17 and 18 show the number of potential beneficiaries from the Strategy and geographic areas where they live.

Table 18: Potential beneficiaries in seven target communities

Village District No. Families/ Population Ethnic Group No. Poor

Families

Nam Dee village Luang Namtha 82/ 368 Lanten/ Sida 15

Chalensouk village Luang Namtha 69/ 358 Khmu 7

Vieng Neua Luang Namtha 262/ 1,271 Kalom 7

Nam Eng Vieng Phoukha 87/ 460 Khmu 6

Nam Pae Vieng Phoukha 102/ 610 Khamu/ Lao Yuan 35

Don Chai Houay Xay 106/ 536 Tai Lue, Hmong, Lamet 2

Nam Chang Houay Xay 30/ 177 Lanten 12

Table 19: Other potential beneficiaries

Location Type Direct Beneficiaries

Indirect Beneficiaries

Total Beneficiaries

Luang Namtha Night Market

40 vendors & 2 employees for cleaning the sites & restrooms

42 360 402

Nam Ha Visitor Center & Market

12 vendors at market & 5 employees 17 108 125

Nam Eng Cave, Market and Picnic Area

12 vendors at market & 3 employees 15 108 123

Vat Mahaphot Historic Site

2 employees for working at ticket booth &

restrooms2 - 2

Bor Kung Restaurant, Market and Souvenir Shop

12 vendors & 8 employees 20 108 128

Nam Pae View Point and Market 12 vendors & 1 employee 13 108 138

5 LNTA 2008 Statistical Report on Tourism

6 The STDP will conduct a baseline, midterm and final evaluation based on standardized monitoring criteria for 9

project provinces. The number of vendors and employees are estimated based on the infrastructure design concepts in Part IV.The measurement of indirect beneficiaries is referred to the EWEC strategy and action plan, which is based on 9 indirect beneficiaries for every one direct beneficiary in the tourism supply chain.

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Location Type Direct Beneficiaries

Indirect Beneficiaries

Total Beneficiaries

Don Chai Market70 vendors &

5 employees75 630 705

Old French Army Fort

5 employees for working at ticket booth, souvenir

shop and restrooms5 - 5

TOTAL 1,628

9. IMPLEMENTATION

Implementation of the Strategy and Action Plan will be aligned with the STDP’s rolling 6-month action plans beginning in October 2009 through September 2014. The Luang Namtha and Bokeo PTD’s will take the lead in implementing the strategy with the support of the STDP project coordination unit based in Vientiane.

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part ii: strategy and action plan to encourage tourists to stay longer

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