On the palm-fringed shores of Phu Quoc, off Vietnam's coast, a transformation is under way. With billions of dollars—and perhaps millions of visitors set to pour in—is this sleepy island ready to become the next great beach resort?

By Peter Jon Lindberg
January 25, 2013
Martin Westlake Phu Quoc
| Credit: Martin Westlake

See the Video: Vietnam's Waking Beauty

If there’s a symbol of the delicate equilibrium of Phu Quoc—of everything that’s so alluring about this island right now—this place has to be it: an open-sided beach shack just 10 yards from the surf, with a thatched roof, 12 tables, and red plastic chairs that sink into the sand. Decorated with cowrie shells and lamps made from coconut husks, it’s the kind of place that makes you almost sort of appreciate Jimmy Buffett.

Mom cooks, daughter takes your order, son makes the drinks. The family lives out back, with their babies and roosters, in a tenuous assemblage of canvas and corrugated metal. They’ve clearly put all their money into the restaurant, which they run with great pride. There’s no credit-card machine, no telephone, no music, no TV showing Premier League soccer games. They have tubs of ice and a blender, but they don’t have a refrigerator. Add a fridge and you introduce the possibility of spoilage. The Palm Tree serves everything the day it’s caught: squid, scallops, garrupa, kingfish. And the food is fabulous. We had fine meals at the resort next door, for 20 times the price. But we kept being drawn back to the Palm Tree—for banana-pancake breakfasts, that backpacker staple; dinners of smoky grilled eggplant and barbecued prawns; midday coconuts and midnight beers.

That a quiet, humble spot such as this could still exist in Southeast Asia in 2007 seems a minor miracle. In this part of the world, one is forever hearing about some bygone golden age. From Ko Chang to Ko Lanta, Lombok to Luang Prabang, the refrain’s the same: Should have been here 10 years ago. Well, in Phu Quoc, at this moment, it is 10 years ago.

I was in Ho Chi Minh City (Saigon) when I first heard the murmurings about a remote, beach-rimmed isle off southwestern Vietnam. This was in 2003. Prices were dirt cheap, my informants said, the reef diving fantastic, the sands pristine and nearly empty.

Among Vietnamese, Phu Quoc had long been a household name for producing the country’s finest nuoc mam, the pungent fish sauce that is a foundation of Vietnamese cooking. Among international travelers, however, the island was largely unknown. That was just fine with early pioneers, such as Phuong Anh Nguyen, owner of HCMC’s famous Q Bar. “The beaches are lovely, and it’s incredibly peaceful,” she told me back then. “When there are better hotels and more regular flights, it will be amazing.” Now, four years later, there are more regular flights and better hotels—and, yes, Phu Quoc is pretty amazing. But for how long?

The largest island in the Gulf of Thailand, Phu Quoc is actually closer to Cambodia—just 9 miles away—than to mainland Vietnam. Cambodia lays a competing claim to the island, which is why the Vietnamese keep a substantial military presence there. (Much of Phu Quoc, in fact, is off-limits to the public.) Stretching 30 miles, north to south, it is roughly the size of Singapore, but it has only 85,000 residents to Singapore’s 4.5 million. In 2001, nearly one-third of the island—including 35,000 acres of primeval forest—was designated a national park. From the air, Phu Quoc registers as a bright-green paint drop, ringed by flecks of ivory, splashed on a turquoise canvas. People compare its shape to a conch shell. Others see a kingfish twisting its tail. Still others will say that Phu Quoc looks like a fat green wad of money. For if all goes according to the official plan, this quiet backwater could become the next Phuket.

Video: Vietnam’s Waking Beauty

In October 2004, Vietnam’s prime minister ratified a proposal—Decision No. 178/2004/QD-TTg—to develop Phu Quoc into “an international and modern center of tourism.” It was a tall order. The island now draws about 150,000 visitors a year. By 2020, the government expects to boost the figure to 3 million. (To put that in perspective, Vietnam as a whole had only 3.4 million visitors in 2006.)

Announcement of the plan set off a flood of investment applications. Foreign corporations have already pledged more than $6 billion toward luxury resorts, cruise-ship terminals, and other tourist facilities on the island. Authorities have promised millions more dollars’ worth of infrastructure improvements. A new international airport is also in the works. Two decades after the government embarked on Doi Moi, its fitful liberalization program, Vietnam’s economy is finally expanding at a rapid clip, helped by the country’s recent accession to the WTO. And tourism is the golden goose. Vietnam currently ranks sixth in the world for tourism growth. But in order to make its mark as an Asian vacationland, it needs more than a handful of second-tier beach resorts—Nha Trang, Mui Ne, and Vung Tau. It needs a young, bankable star. And so Phu Quoc—like a wide-eyed kid blinking in the footlights—is being groomed for a splashy debut.

The word “sleepy” doesn’t begin to describe Phu Quoc. Most of the island’s roads are rough tracks of Martian-red clay, pocked by craters and layered with dust. Only a few motorbikes occupy the main highways, and hardly any four-wheeled vehicles besides tractors, oxcarts, and the occasional hotel minivan. The island’s unofficial capital, Duong Dong, has the tumbledown aspect of a frontier town. In the villages along the coast, the only time the collective pulse quickens is during one of the all-too-frequent blackouts, when the sputtering of generators breaks the pervasive calm.

For now, tourism is just a trickle. Phu Quoc’s tiny airport can accommodate nothing larger than an ATR turboprop; four to five daily flights from Ho Chi Minh City bring in a maximum of 335 passengers. The remaining visitors—backpackers, mostly—arrive from the mainland by ferry.

The first place everyone heads for is Long Beach (Bai Truong), a 12-mile sweep of hourglass-fine sand on the east coast, where most of Phu Quoc’s hotels and guesthouses are clustered. Development has so far been confined to the northern end of the beach, a pleasantly dizzy mile of thatched-roof palapas, concrete bungalows, seaside cafés strung up with twinkly lights, and volleyball courts.

The volleyball courts were empty for all eight days I spent on Phu Quoc, accompanied by my wife and two friends. Each morning we would stroll up the beach, bare feet squeaking in the sand. Clusters of Vietnamese women in indigo smocks and conical hats proffered pineapples, mangoes, and back rubs. Vendors outnumbered vendees. We watched one portly German flop down in the sand to receive, from an especially bored group, a 12-handed massage. Nearby, three bone-skinny cows grazed in the shade of a coconut palm, lowing in accompaniment to the German’s grunts and groans. Soon a young girl appeared, brandishing a switch of bamboo. At her coaxing the cows began a slow march down the beach, the surf splashing at their hooves.

Into this rustic scene has entered a surprisingly well-heeled guest. The $4.2 million Grand Mercure La Veranda Resort & Spa, which opened on Long Beach last August, is Phu Quoc’s most imposing property yet and no doubt the vanguard of what’s to come. This is no sprawling, soaring mega-resort—just 43 rooms on 2½ acres. But among the beach shacks and guest cottages that flank it (the Palm Tree is just next door), La Veranda sticks out like a triple-tiered wedding cake in a breadbasket.

The look is cheery French colonial: yellow walls, terra-cotta tiles, whitewashed louvers, paddle fans stirring the air. And the setting, in contrast to the rough, dusty road beyond, is pure tropical bliss. Each time we drove in we were struck by the fragrance of jasmine and frangipani, the shock of manicured lawns, heliconia, bougainvillea, and birds-of-paradise along the brick paths.

The better guest rooms are set, three abreast, in single-story villas on a gently graded hillside above the beach; the remainder are in a two-story hotel building near the back of the property. Villas are the clear choice here, for both their ocean views and their generous size. Our front-row suite had 14-foot cathedral ceilings, a teak canopy bed with mosquito netting, and a jarringly big, echoey bathroom with twin sinks, a stall shower, and a massive tub.

Most of the other guests were middle-aged Germans. They lingered long over the breakfast buffet and sang boisterous songs by the pool. In the afternoons they booked up all six treatment rooms at the spa; at sundown they gathered on the wraparound porch for cocktails and the slow descent into dinnertime.

How much you enjoy the resort depends on how much you insist on being taken care of. Those expecting minimal attention will do fine. But if you require one-hour laundry service or half-caf soy-milk lattes, La Veranda isn’t for you. Though the resort has a two-to-one staff-to-guest ratio, the point is moot when 90 percent of the staff speaks only Vietnamese. Resort employees answer “yes” to every inquiry, even when they don’t understand the question. But then, how could one expect otherwise? Ten months ago many of them were farmers or fishermen.

“Finding and training the staff has been a challenge,” the resort’s owner, Jean-Pierre Gerbet, admits. “It is an island, after all.” Gerbet is the scion of a French family that has been in Asia since the 19th century. “My maternal great-grandmother was Vietnamese and was actually born on Phu Quoc,” he says, with hypercorrect pronunciation: “foo wok.” Twelve years ago, he moved from Hong Kong to Vietnam and was an original investor in Ana Mandara, the country’s first luxury beach resort, which opened in 1997 in Nha Trang. Gerbet first visited Phu Quoc a decade ago and immediately recognized its potential. “I was in Phuket in 1985 for the opening of Club Med, which back then was the only luxury resort on that island,” he recalls. “I can still picture it so clearly—the mountains, the jungle, the wonderful beaches, all of it relatively unspoiled. The feeling’s much the same now in Phu Quoc.”

When I ask him about the government plans, Gerbet is reflective. “I know they intend to develop the island,” he says. “It’s just a question of when. When will the infrastructure go up? When will all this money actually get here?”

Our fellow guests were content never to stray beyond the beach, the spa, and the omelette station, but we were determined to see the rest of the island. This came as a surprise to the staff. “Yeeeess,” they said, though their expressions said, “Why would you want to do that?” Eventually they relented, and each afternoon we’d pile into a 1973 open-top Jeep with our teenage driver and bump down the road in search of kicks. First stop: a fish-sauce factory.

What Tuscany is to olive oil, Phu Quoc is to nuoc mam. In Asian supermarkets you'll find plenty of counterfeits trading on the island’s name. The genuine article is made only from ca com anchovies (literally “rice fish,” a reference to their pale-white flesh) that flourish in the waters around Phu Quoc. The island’s hundred-odd distilleries produce 2.6 million gallons of nuoc mam per year. When we stopped in at the Khai Hoan factory, workers were unloading heaps of anchovies from a disheveled wooden boat onto a rickety pier. Inside a warehouse were rows of 3,000-gallon vats made from go sao, a Phu Quoc native hardwood that lends its own distinct flavor to the sauce. Inside the vats, anchovies and sea salt ferment for a year or longer, then the resulting liquid is drained through a tap. The first pressing—a glowing amber brew known as nuoc mam nhi—is the most coveted, but even subsequent pressings have an impressive clarity and consistency. The noxious stench belies the taste: bright, rich, and delightfully tangy. Khai Hoan sells bottles at its gift shop, but you can’t actually carry them home. Because of the risk of spillage, Vietnam Airlines won’t allow nuoc mam on its planes. One local guesthouse bans “toxic, explosive, and inflammable substances, weapons, pets, and fish sauce” from guest rooms.

We’d heard raves about the beauty of Bai Sao, the most talked-about beach on the southeast coast, so we went there expecting a scene. But when we arrived at the end of a long rutted track through the woods and emerged onto a glittering ivory crescent of beach, we found only a dozen fellow travelers—Australians, Thais, a trio of Brits—reading, dozing on blankets, floating on their backs in the calm cerulean water. For all an uninformed visitor could tell, they’d been shipwrecked here or dropped like leaflets from a low-flying plane. For a half-mile there were no lifeguards, no vendors—almost nothing man-made except a small café and a few rustic bungalows. The silence was almost eerie.

At the daily market in Duong Dong town we encountered our only traffic jam: half the island’s population packed into six chaotic blocks, where hundreds of vendors sold suckling pigs, fish just off the boat, and local fruits and vegetables. Three seamstresses, shielded from the sun by pink parasols, worked foot-cranked sewing machines. Nearby, a young girl was unraveling skeins of off-white yarn, or so we thought: a closer look showed them to be rice noodles.

Considering how few restaurants Phu Quoc has, we ate extraordinarily well. Bowls of robust and aromatic pho noodle soup convinced us to return three times to the convivial Le Giang café in Duong Dong. At a nearby street cart tended by a friendly grandmother in a lavender pantsuit, we lucked upon a great banh mi sandwich: a plush baguette with barbecued pork, pâté, pickled carrots and daikon, cilantro, and cucumber.

Up north, at the beachside joint Gio Bien (“Sea Breeze”)—with hammocks and tables under casuarina trees—we found what was easily the finest squid I’ve ever tasted. Our waiter, who looked about 14, set a brazier full of smoldering charcoal on the table, then returned bearing a platter of raw squid—mottled, eight-inch beauties, their rigid beaks still intact, swimming in chili oil and sea salt. Nervously at first, we placed them on the grill to sizzle for a few minutes. They came out perfectly tender, with a buttery taste backed by a hint of brine.

Locals told us that the squid around Phu Quoc eat a diet of ca com, the same anchovy used in nuoc mam, which gives them their rich flavor. We ordered grilled squid twice a day for a week and never tired of it. Nor was there any shortage of the stuff: of the 2,000 fishing boats registered on Phu Quoc, at least half ply the squid trade. Fishermen work after dark, using flashlights and lanterns to attract their catch. Every night, we would gaze out at a fleet of squid boats, a makeshift city twinkling on an inky black sea.

In May 2006, a conference was held in Ho Chi Minh City to promote investment in Phu Quoc. The keynote address, by Truong Quoc Tuan—a member of the Communist Party and chairman of the People’s Council—could be summed up by its title: “Building and Developing Phu Quoc Island into an International-Class Marine Eco-Tourism Center of High Quality.” A few hundred prospectors listened as Truong and other officials outlined their bold agenda.

The speeches showed a typical socialist exuberance over public works: the most spirited passages concerned sewage treatment plants and power grids, those glorious symbols of revolution. But conservation was also key. Chairman Truong affirmed that “Phu Quoc’s natural landscape must be conserved” and development “must ensure stability and sustainability.” Everyone seemed to appreciate how precious an island Phu Quoc really is.

But their ears really perked up at the long list of development incentives. Compared with mainland Vietnam, Phu Quoc is a veritable free market. Foreign direct investment is actively encouraged. Generous tax breaks are given to local and foreign developers. For non-Vietnamese, leasing property on Phu Quoc is far easier than on the mainland. And entry requirements have been relaxed, so tourists don’t need visas for short-term visits. All this amounts to a radical departure for Vietnam’s notoriously insular government.

One of scores of investors so far is John Goodyear, an Australian expat who is building a 26-acre resort, Cape Da Bac, on Phu Quoc’s east coast. (Goodyear also co-owns the Islington, a chic boutique hotel in Hobart, Tasmania.) When it is finished in 2009, the resort will comprise about 20 guest rooms and several private villas on a hillside dotted with mango trees and cut by a mountain stream.

But Cape Da Bac will be a mere blip among the mammoth developments under way elsewhere on Phu Quoc. A Zurich-based consortium called Trustee Suisse is creating a $2.6 billion “luxury ecotourism complex,” dubbed the Pearl of Asia, on an isolated shoreline up north. And an American firm, Rockingham Asset Management, has broken ground on a $1.2 billion, 2,500-acre development near Bai Sao. Set for completion in 2015, the project will have 2,000 hotel rooms, a 36-hole golf course, a Las Vegas-style casino, and an auto-racing track.

Wait a minute: auto racing? For all the lip service paid to sensible development, the bigger projects being proposed show little evidence of that bent. (When ecotourism and Las Vegas–style appear on the same prospectus, somebody’s obviously deluded.) Nor is Vietnam known for an enlightened conservation policy.

“I'm sure the government wants to do the right thing, but whether they have the education and the willingness to enforce is another matter,” Gerbet says. “They have to decide what an 'ecological’ development really is, and what the standards are.”

Still, there have been encouraging signs, not least the national park created in 2001. Last year unesco declared all of Kien Giang province (which includes Phu Quoc) a Biosphere Reserve. And plans are afoot to establish a 38-square-mile marine park in the An Thoi archipelago, just south of Phu Quoc—a prime habitat for dolphins and sea turtles. (Gerbet hopes eventually to create “a low-impact eco-resort” there himself, on an uninhabited islet he owns.)

Goodyear has worked in Vietnam for 16 years and is cautiously optimistic about Phu Quoc’s prospects. “The government’s got a damned impressive wish list and is absolutely serious about it,” he says. “Then again, I don’t know how you turn a totally undeveloped island into Ko Samui. How do you get there?”

Some places you see through the lens of the past. Walk around Teotihuacán, Le Marais, or the Old Quarter of Hanoi, and you imagine them in their long-ago heyday. In Phu Quoc it’s impossible not to flash-forward to the future. Everywhere we went, we found ourselves jolted by visions of things yet to exist, ghosts yet to be born. We’d pass a tin-roofed shack in a field and see in its place a towering waterslide. We’d come upon two chickens pecking at a compost heap, and instead see a KFC. Beside the coastal road, cows had grazed the grass down to the dirt; we saw a putting green. Every plot of land might as well have been posted WATCH THIS SPACE. (Some actually were: we spotted plenty of real-estate signs in barren fields.) Phu Quoc’s wilder corners felt like a football stadium in the hours before the crowds pour in for the game, the wind blowing the candy wrappers around the empty seats.

Whiling away one last languid afternoon at the Palm Tree, we couldn’t help thinking our beloved shack would be replaced by some sprawling 17-star resort, complete with a Kidz Klub and $12 daiquiris you can charge to your room. But from our perch, sinking into the sand on the Palm Tree’s crooked plastic chairs, that outcome seemed too harsh to consider. So we ordered a final round of coconuts and watched the sun fall into the Gulf of Thailand—somewhere over Ko Samui, from which we were separated by 275 miles, and maybe a decade or two.

Peter Jon Lindberg is a special correspondent for Travel + Leisure.

Getting There

Book tickets well in advance through a travel agent or the airline’s Vietnam offices (84-8/844-6667; www.vietnamair.com.vn).

When to Go

Phu Quoc is dry from November to April and rainier and more humid from May to October. The year-round average temperature is 81 degrees. December and January bring the biggest crowds.

Where to Stay

Grand Mercure La Veranda Resort & Spa
Tran Hung Dao St., Duong Dong Beach; 84-77/982-988; www.laverandaresort.com; doubles from $135.


Note: Expect to pay in cash only.

Banh mi cart
Ly Tu Trong at 30 Thang 4 (across from the Vietcom bank, outside the souvenir shop), Duong Dong; no phone. Lunch for two 60 cents.

Gio Bien
On the beach at Mui Duong, Ganh Dau District; 84-77/845-507; lunch for two $20.

Le Giang
7 Tran Hung Dao St., Duong Dong; 84-77/846-444; dinner for two $15.

The Palm Tree
Bai Truong (Long Beach), next door to La Veranda; no phone; lunch for two $10.

What to Do

  • An Thoi Islands
  • Book a trip through Rainbow Divers.
  • 84-91/340-0964; www.divevietnam.com; trips from $25.

Khai Hoan Fish Sauce Factory
Remember, if you buy sauce, you'll have to ship, not carry, it home.
Hung Vuong St., Duong Dong; 84-77/848-555.

Khai Hoan Fish Sauce Factory

Scuba Dive in the An Thoi Islands

The Palm Tree

Le Giang

Gio Bien

Banh mi cart

La Veranda Resort Phu Quoc

Formerly Grand Mercure La Veranda Resort.

The poshest of Phu Quoc's dozen hotels and guesthouses, La Veranda sports paddle fans, butter-yellow exteriors, whitewashed louvers, and tropical gardens recalling a colonial plantation. Freestanding deluxe villas are the best choice for their sea-facing porches, spacious bathrooms, and cathedral ceilings. There's a good in-house restaurant, a lively bar, and a modest spa, but the real draw is the location: smack on a 12-mile stretch of soft sand with a prime sunset vantage over the sea. Swim out to the pontoon dock and doze off to the gentle afternoon swells, or indulge in a $5 surfside massage (vendors outnumber the tourists—at least for now). The concierge can arrange snorkeling or diving excursions in the nearby An Thoi archipelago as well as nighttime squid-fishing trips (Phu Quoc squid is among the finest in Asia).