There are a fast growing number of Chinese people who want to travel internationally as tourists. The Philippines is, or at least has the potential to be, an important tourist destination. The Chinese have lifted a travel ban—as part of the rapprochement between China and the Philippines—and target 1,000,000 tourist arrivals in the Philippines during 2017, a doubling of the number of arrivals in 2015. Not too difficult an objective, particularly given the frantic development of casinos in Manila – the Chinese like to gamble.
However, as we know the Philippines gets way less tourists than its Asian neighbours, and to be objective, less than its fair share. Thailand tops the league with 36 million arrivals, followed by Malaysia, with about 27 million, Singapore 16 million, Indonesia about 14 million and Vietnam 12 million. The Philippines, with its 6 million arrivals, compares with Myanmar [targeting 5 million]and Cambodia.
Of Canadian tourists, there were less than 200,000 who spend the most—P85,000/capita. Tourists from the USA, Japan, UK, India and Korea, (which provides by far the greatest number of tourists to the Philippines, nearly 2 million), spend between P30 and 45,000/capita.
Chinese tourists are officially at least, the lowest spenders of all at less than P10,000/capita. A doubling of Chinese tourists would, thus, introduce P5 billion to the economy, or at current exchange rates, $100 million—about the cost of developing a five-star, 300-room hotel employing around 600 people. In other words, not a significant amount in terms of a tourism contribution to the national economy.
Manila has good quality hotels and there are good beaches and islands to visit. The trials and tribulations in getting from Manila to the provincial tourist spots are, however, daunting. Domestic air fares, even managing to get seats in planes that are usually late, are scandalous. You have to enter a lottery to get a ticket and the cost of flights to, say, Palawan can be anything up to P40,000 return—you can fly to Europe or America for that!
The awfulness of booking systems in which the prices increase by the hour is more than most people are happy to cope with. If tourism is to be encouraged and, certainly the Philippines needs to dramatically increase this sector of its economy, then some regulation needs to be imposed on domestic airfares which are, after all, a public utility.
Rather than doubling the number of low-spending Chinese tourists, attention should be given to the higher spending end, those from the Americas, Europe, Korea. To double the number of Australian tourist arrivals from the current 40,000 would inject $2 billion into the economy. To double the arrivals from the higher-spending end would introduce over P10 million for an increase of about 250,000 arrivals, avoiding putting too much strain on the weak tourist infrastructure.
But the Philippines is still a backpacking type tourist destination; Manila with its five-star facilities doesn’t have too much for the visiting holidaying family. The Philippines is all about beaches and there are some really nice ones. It’s just that getting to them is more for the adventurous types, and with over 7,000 islands to get to it must be a bit tricky to get to the beach.
To encourage tourism, the Philippines has to be able to deliver the facilities, and to encourage the high-spending end of the market it should be made easier for them to get their families to the great beaches. Some less alarmist tourist warning by foreign embassies would also be helpful!
Mike can be contacted at email@example.com