‘Vaccination will release pent-up demand for Asean tourism’
KUALA LUMPUR: Domestic travel will kickstart the recovery of Asean’s tourism sector with full recovery hinging on vaccination rates, according to panellists at Maybank Kim Eng’s ‘Is Asean Tourism Dead?’ webinar held recently.
Agoda Corporate Development vice president Tim Hughes, said: “When consumers come back, they come back for domestic first: the driveable markets around them, two to three hours outside of their capital city. But then very quickly, they are prepared to get back on airplanes. We saw that in Thailand, Vietnam and to a lesser extent, Malaysia.”
Tim added that these three markets saw domestic destinations that were not in the Top 10 before now becoming popular. “People were keen to get out of cities and into the countryside, up into the highlands or to the beaches.
“We actually saw a surprising number of people shifting up a star rating. They weren’t necessarily looking for the cheapest trip.”
Philippines Department of Tourism Undersecretary for Tourism Development Benito C Bengzon Jr noted that even before the onset of Covid19, the Philippines enjoyed a healthy domestic tourism sector, registering 110 million domestic trips that generated revenue five times bigger than revenue from inbound trips.
“What we’ve seen over the last couple of months is that there’s been a lot of interest in opening up travel bubbles. We’ve been talking very closely, for example, with our partners in Korea. What we’ve found is that there continues to be very strong demand for our island destinations,” Benito added.
Agoda has also observed robust pent-up demand.
“This crisis taught us one thing: it had no impact on the long term desire of consumers to travel. Just the first announcement of the Singapore-Hong Kong travel bubble saw a 14-times spike in our searches for those destinations; while with the very brief Singapore-Australia bubble, we saw a three times increase. Even when something is just an idea or concept, we see a spike,” Tim said.
The return of international visitors is important to the recovery of the tourism industry in Asean. This is especially true for Chinese tourists, whom accounted for a quarter of total tourist arrivals in Asean during pre-Covid times in 2019, based on Maybank Kim Eng Research data.
Central Plaza Hotel Group deputy CEO Markland Blaiklock is optimistic, saying: “Definitely, Chinese tourists will return. The pace remains to be seen, but I’m sure the demand is as strong as ever, if not stronger. People from China will be looking for more varied experiences and sampling other things that they perhaps didn’t in the past.”
To support the return of international visitors, the panel was unanimous that countries are unlikely to wait for a return to zero cases before resuming travel. Instead, vaccination rates and health and safety protocols are seen as key to full reopening.
Benito remarked: “If you find a single shoplifter in the supermarket, would you have to close down the whole store? In some ways, it’s the same case for tourism. All of us must do our best to keep the number of cases down and to make sure that the protocols are in place in the event we detect a positive case.”
The Philippines, Thailand, Indonesia and Vietnam are expected to have 70 per cent of their populations vaccinated by the end of 2021, according to data compiled by Maybank Kim Eng Research. The full reopening of Asean’s six largest countries for tourism is expected in early 2022.
Tim posited that the technology for a vaccine passport could be developed quickly, given the travel industry’s years of experience in building fintech solutions.
“The technology to build a viable, secure, identity-confirmed passport is actually relatively easy.
“What we need is the data input from government. We need a way in which the governments agree on how they recognise the various vaccines people have received,” he said.
The webinar was the fifth in the Invest Asean 2021 series, Maybank Kim Eng’s flagship annual investor conference that will run till August. The next conversation on Asean Blockchain + Crypto: Opportunities & Hurdles will take place on July 15, 2021.