Risk Management in Viet Nam Tourism Industry Under the Impact of a Two Factor Model During and After the Global Crisis

Over past few years, the global financial crisis shows certain influence on emerging financial markets including Viet nam. Therefore, this study chooses an analytical approach to give some systematic opinions on how much some certain determinants such as income tax and leverage, affect the level of market risk in listed tourism companies. First, it calculates equity and asset beta values in three different scenarios of changing tax rates and changing the level of financial leverage. Second, under 3 different scenarios of changing tax rates (20%, 25% and 28%), we recognized that there is not large disperse in equity beta values, estimated at 0,753 for current leverage situation. Third, by changing tax rates in 3 scenarios (25%, 20% and 28%), we recognized both equity and asset beta mean values have positive relationship with the increasing level of tax rate. Last but not least, this paper covers some ideas and policy suggestions.

In this case, all beta values of 10 listed firms on VN airline and tourism industry market as following:  All beta values of total 10 listed firms on VN airline and tourism industry market as below: All three above tables and data show that there are just tiny changes in the values of equity beta and there are bigger fluctuations in the values of asset beta in the three cases.   First of all, Equity beta mean values in all 3 scenarios are acceptable (< 0,9) and asset beta mean values are also small (< 0,7). If leverage increases to 30%, asset beta max values keep the same value of 1,497 when tax rate is up to 28% or down to 20%. Finally, when leverage decreases down to 20%, asset beta max values keep the same value of 1,555 in both cases: tax rate up and down.

Comparing Statistical Results in 3 Scenarios of Changing Leverage
The below chart 1 shows us : when leverage degree decreases down to 20%, if tax rate is up to 28%, average equity beta value increases slightly (0,837) compared to that at the decrease of tax rate of 20% (0,822). However, equity beta var is 0,754 (tax rate up), little higher than 0,752 (tax rate down). Then, when leverage degree increases up to 30%, if tax rate is up to 28%, average equity beta increases little (to 0,667) compared to that at the decrease of tax rate of 20% (0,656). However, in case the tax rate up, the equity beta var is 0,787, smaller than 0,790 (tax rate down).
The below chart 2 shows us: when leverage degree decreases down to 20%, if tax rate is up to 28%, average asset beta value increases slightly (0,606) compared to that at the decrease of tax rate of 20% (0,597). However, asset beta var is 0,557 (tax rate up), the same as that in the case of tax rate down.
Then, when leverage degree increases up to 30%, if tax rate is up to 28%, average asset beta also increases little more (to 0,606) compared to that at the decrease of tax rate of 20% (0,597). However, in case the tax rate up, the asset beta var is 0,497, higher than 0,495 (tax rate down).

Conclusion and Policy Suggestion
In summary, the government has to consider the impacts on the movement of market risk in the markets when it changes the macro policies and the legal system and regulation for developing the tourism market. The Ministry of Finance continues to increase the effectiveness of fiscal policies and tax policies which are needed to combine with other macro policies at the same time. The State Bank of Viet Nam continues to increase the effectiveness of capital providing channels for tourism companies as we might note that in this study when leverage is going to increase up to 30%, the risk level decreases (asset beta mean decreases to 0,597 if tax rate moves down to 20%).
Furthermore, the entire efforts among many different government bodies need to be coordinated.
Tourism and hotel industry in Vietnam also need to establish risk warning system (for environment, human resource, financial, business, unexpected risk and technology risk). Vietnam tourism school also enhance training programs to meet the market demand while hotel industry has to improve quality of service and reduce risk in 4.0 technology era.
Finally, this paper suggests implications for further research and policy suggestion for the Viet Nam government and relevant organizations, economists and investors from current market conditions.