Biology of Business

Hue

TL;DR

Vietnam's former imperial capital now earns billions from tourists visiting sites where 5-10% of its population was massacred — a heritage economy locked in by UNESCO.

City in Hue City

By Alex Denne

During 26 days in January and February 1968, North Vietnamese forces executed between 2,800 and 6,000 civilians in Hue — roughly 5-10% of the city's population. Mass graves continued to surface for years. The Imperial Citadel, seat of the Nguyen dynasty for 143 years, was partially destroyed in the fighting. Today, over three million tourists visit those sites annually, generating billions of dong in ticket revenue.

Hue monetises the locations where its population was massacred. This is not cynicism — it is the only viable economic model available. UNESCO designated the Imperial Citadel complex a World Heritage Site in 1993, and the designation functioned as an economic catalyst: visitor numbers grew from a few thousand annually to over three million. Heritage tourism is Hue's keystone species. Remove the UNESCO designation, and the supporting ecosystem of hotels, guides, restaurants, and craft workshops collapses.

Three million tourists visit sites where 5-10% of the city's population was executed — heritage tourism built on the ruins of a massacre that destroyed the imperial capital.

The economic logic creates a preservation trap. Any development that damages heritage sites destroys the tourism revenue that funds the city. But preserving the sites requires suppressing the construction and industrialisation that would diversify the economy beyond tourism. Hue cannot develop because development would destroy the only thing that makes it valuable — its ruins.

This is a phase transition that locked into a new stable state. Before 1968, Hue was Vietnam's imperial capital — a functioning administrative centre. The massacre and battle destroyed that identity. The city could have rebuilt as an industrial or commercial centre, but the UNESCO designation in 1993 locked it into a heritage economy instead. Once the tourism infrastructure was built around preserved ruins, the switching costs became prohibitive.

Hue parallels forest succession after catastrophic fire. The old-growth canopy (imperial administration) was destroyed. Pioneer species (basic reconstruction) appeared first. But then a particular succession pathway locked in — heritage tourism colonised the disturbed landscape and now prevents alternative growth. The forest cannot return to its original state, and it cannot transition to something new, because the current vegetation suppresses all competitors.

Key Facts

460,000
Population

Related Mechanisms for Hue