Five-year plan for growing tourism industry

The Philippine government has set out a five-year plan starting 2011 to develop the tourism industry as a key contributor to the economy.

The National Tourism Development Plan (NTDP) 2011-2016 has a target of 10 million international arrivals and 56.1 million domestic travellers, both generating a total of P2.31 trillion in revenues.

It also aims to employ 7.4 million workers in the industry by end-2016, contributing 8.7 percent to gross domestic product (GDP).

With a little over a year and a half left, the Department of Tourism (DOT) said the foreign tourists target remains but achieving it may be far-fetched, but all is well with the revenue and employment goals.

“We are still aiming for the best. Even at less than 10 million arrivals in 2016, we are confident that we will continue to hit -or even surpass- our targets for revenues and employment,” the DOT said.

The agency noted that this is because the quality of arrivals, or the length of stay and average daily expenditure, are at an all-time high.

Last month, DOT Secretary Ramon Jimenez had said the inflow of tourists “was not as expected” and conceded the 10 million arrivals target will be difficult to meet.

The country has struggled in achieving targets in the past couple of years due to the negative impact of travel advisories by a number of countries.

In 2013, tourist arrivals reached 4.68 million, falling short from the country’s five million target. In 2014, inbound visitors was at 4.83 million, again missing the five million target for the year.

This year, the goal was downgraded from six million arrivals to at least five million. So far, the country has welcomed 2.23 million foreigners from January to May.

That’s why the DOT has shifted the way it looks at the country’s tourism performance to revenue and employment generation.

“Foreign tourists are spending more money and staying longer in the Philippines. And we will continue to manage the tourism business this way,” the DOT said.

The country booked P225.3 billion in revenues from inbound tourism in 2013 and P274.6 billion in 2014.

In fact, the country is now seen as a premium destination, a favorable development as this generates higher revenues and more employment, S8 Exhibition Inc. president Fe Abling-Yu said in an e-mail response. S8 Exhibition is an association of the biggest travel agencies in the country.

“Philippine tourism industry is slowly but surely gaining its reputation to be a premium destination, where revenue, foreign arrivals and employment generation are collaborative factors,” she said.

The country’s robust economic growth in the past few years has attracted a number of international tourism brands, helping the country attract luxury travellers.

“Several international brand hotels, such as Accor, Shangri-La, Ascott opened this year and even local investors ventured on opening luxury resorts, like Henann Bohol, Huma, Crimson, to name a few,” Abling-Yu said.

Data from the DOT showed that from 2010 to the first half of 2015, a total of 120 tourism related investments amounting to P125.84 billion were endorsed to the Board of Investments (BOI) and the Philippine Economic Zone Authority (PEZA). These investments were estimated to generate 22,326 jobs.

These investments not only included global hotel brands but also local developments catering to the premium market, like Solaire Resort and Casino Manila, Alphaland Balesin Island Resort, City of Dreams Manila and Amanpulo Villas Palawan, the agency said.

Last May, S8 Exhibition organized the Asia Premium Travel Mart (APTM) in May to pitch the Philippines to luxury tourists.

Abling-Yu said the APTM was a big success and will now be a yearly event. “The bottom line of this travel mart is for Philippines to be known as a premium destination,” she said.

Globally, the tourism industry is recognized as the second fastest growing sector, employing even more than the manufacturing and any other subsector in the services sector.

Based on a report released by the World Travel & Tourism Council earlier this year, the global tourism sector employed 277 million jobs in 2014, or 9.4 percent of world employment.

Meanwhile, 105 million people are directly employed in the sector last year. It employs seven times more than the 14 million workers in automotive manufacturing and two times more than the financial services.

Based on the July 2015 report presented by the Philippine Statistics Authority (PSA), there were 4.76 million people directly employed in the tourism industry in 2014 from 4.71 million people recorded in 2013. This accounts for 12.5 percent share of tourism in the national employment.

The NTDP 2011-2016 targets tourism employment to reach 7.4 million, with an 18.1 percent share to national employment.

But in order to create more jobs, more government intervention is needed to entice the private sector to invest more in the tourism industry.

“The DOT and all its attached agencies have to work hand-inhand in streamlining the requirements, without, of course, violating the prescribed laws to entice international and local investors,” Abling-Yu said.

While the DOT has endorsed a number of tourism-related investments to incentive-giving agencies, the implementation of revenue regulations under the Tourism Act of 2009 would attract more developments.

The Bureau of Internal Revenue (BIR) has yet to come out with its decision on the grant of tax and other fiscal incentives, and this has deterred investors from putting their money on tourism, Tourism Promotion Board (TPB) chief operating officer Domingo Ramon Enerio III said.

Signed by then President and now Pampanga Representative Gloria Macapagal-Arroyo, the Tourism Act of 2009 or Republic Act (RA) 9593 provides for the creation of the Tourism Infrastructure and Enterprise Zone Authority (TIEZA) that will designate Tourism