While much of the economy has opened up, the tourism sector is still lagging and not pulling its weight. Slugging tourism revenues, along with external shocks such as the Ukraine war, are among the reasons why the International Monetary Fund slashed Philippine growth prospects to only 6.5 percent this year and five percent next year.
It will be recalled that the tourism sector was among the strong drivers of the economy prior to the pandemic. Back in 2019, tourism employed 5.8 million Filipinos and accounted for 12.7 percent of gross national product or roughly $46.5 billion worth of goods and services. Its hefty contribution to the economy was achieved on the back of 8.2 million foreign visitors and more than 120 million domestic travelers.
Unfortunately, all that went kaput when the pandemic struck. Foreign arrivals plunged to just 169,895 in 2021 and 1.7 million (forecasted) this year.
But the pandemic is as good as behind us. Economies all over the world are gearing up for a strong comeback in international travel next year. Japan recently announced visa-free entry for short staying visitors, Vietnam is restoring all its pre-COVID inbound direct flights and Thailand has increased its marketing budget by more than 20 percent. The Philippines must stage its own tourism assault.
I’ve been monitoring the developments in the tourism sector but haven’t heard much from the DOT except for the plan of newly appointed Secretary Christina Frasco to change the “Its more fun in the Philippines” campaign. The new campaign has big shoes to fill. The “More Fun” campaign tripled our foreign arrivals since it was launched in 2012. It is an undeniable success in terms of arrivals, revenues and branding. I am eager to see what Secretary Frasco has in mind.
Marketing slogan aside, the pandemic has induced many changes in tourism preferences and the Department of Tourism will do well to adapt.
Health and safety are now the top concerns of tourists, not only against COVID but against all types of pathogens. As early as May 2020, the DOT put together a handbook of health protocols based on the standards of the World Travel & Tourism Council. Tourism establishments that conformed to these standards were granted safety seals by the DOT. This program must be continued for the peace of mind of visitors.
In terms of measuring success, its all about revenues rather than foreign arrivals per se. As a country that can only be accessed by air and sea, we can never compete with the arrival numbers of our neighbors who generate visitors via day trips on cross-border tours. For us, we must focus on increasing lengths of stay and average spend so as to derive maximum incomes.
Australia is an ideal model for us. Visitors to Australia stay an average of 32 nights, far more than in Singapore at 4.4 nights and Malaysia at 6.2 nights. Tourists in the Philippines stay an average of 10.58 nights. In 2019, the Ozzies generated a whopping $155 billion in revenues on the back of just 9.8 million visitors.
Australia’s success is anchored on having multiple destinations, each having premium offerings in accommodations, gastronomy and attractions. Thus, our thrust should be to evolve towards being a premium destination. This is especially true now that we have made a commitment to sustainable tourism.
After all, market preferences have changed. Curated tourism destinations like Macau and commercialized islands like Bali are no longer the trend. In the post-COVID world, virgin communities have become the preferred destinations. Authenticity is the new premium.
Studies show that affluent professionals, honeymooners, diverse and leisure travelers prefer off-the-beaten-path destinations where they can experience local culture. The more authentic, the better. However, they still require the comforts of luxury dwellings, personal security and ease in transfers.
That said, I see Palawan, Ifugao, Sagada, Siquijor, Camiguin, Batanes, Sipalay and Antique to be priority destinations for further development. Thanks to better infrastructure, we are no longer Manila-centric.
In terms of product development, each region must be made to develop “tourism circuits” composed of new sites, attractions, activities and experiences to add value and broaden their appeal. Camiguin, for instance, has added gastronomy, nature photography and historical tours to its usual offering of beach, diving and eco-tourism products. Other regions have added pilgrimage (religious tours), sports and adventure, rural & farm immersions and wellness tours to their offerings.
Further, a new generation of tour guides must be developed, each with their own field of specialty. Some could be experts in history, others in flora and fauna, others in gastronomy and so forth. Tour guides and service providers should be required to undergo training programs to elevate service and efficiency. Models for this were crafted during the time of secretary Berna Romulo-Puyat.
Awareness is key and digital advertising has proven to be the most effective medium for promotions. Apart from ads and features on social media platforms, the Travel Philippines App serves as an equally important tool where potential visitors can go on virtual tours of our attractions, create their itineraries and make bookings. This should be strengthened.
If we are lucky, the Philippines will attain 2019 arrival figures and revenues next year. However, this can be accelerated if more direct flights to and from key destinations are arranged. Direct flights is the secret to the success of Bali and Phuket and the Philippines is in the position to do the same, what with numerous new airports built or rehabilitated around the country.
Forbes Magazine named the Philippines among the seven countries with the potential to become a major tourist powerhouse. If we play our cards right, the industry can emerge stronger than it was before. I look forward to hearing the programs of the DOT under Sec. Frasco.
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E-mail: [email protected]. Follow him on Twitter @aj_masigan