February 27, 2017, 3:08 pm
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Shifting gears from visitor arrivals to economic benefits

AS THE Department of Tourism (DOT) is set to miss its visitor arrival target this year, the government is now setting its sights on bigger economic prospects of the industry despite hitting only half of its 10-million tourist goal in 2015.

With only five months left in the Aquino administration, the DOT has shifted its gears from focusing on the number of visitor arrivals to achieving other economic aspects of the industry, such as inclusive growth and greater revenue yields, according to Benito Bengzon, tourism undersecretary for planning.

“In our preliminary discussions, we are now putting a greater focus on inclusive growth, support to small and medium enterprises, and the overarching principle of sustainability or sustainable development,” Bengzon said.

This “wider net” for all public and private stakeholders should be prioritized by the government not only in the final days of the Aquino administration but also the next, he said.

Bengzon said the country should step up its efforts in ensuring local communities benefit from the overall growth of the industry. 

“People now have to understand we’re in the big league. With the 5-million mark, this now allows us now to shift gears to economic benefits and development,” he said.

Despite the industry’s failure to attract 10 million visitors by the time the president bows out from office in June, the government is still on track with its target of achieving about P350-billion in tourism revenues in 2015.

Instead of focusing on the tourist arrivals, this is the bigger cherry that the DOT is aiming for, larger tourism receipts from visitors coming from high-yield markets.

These source markets, like those from the Middle East and Europe, post higher average daily expenditures and longer staying duration.

“The more that you are attracting higher spending and longer staying markets, the more that you are also generating higher tourism revenues,” Rolando Canizal, Assistant Secretary for Tourism Development Planning, said in an earlier interview.

In 2014, total international tourism receipts already grew by 21.9 percent to P274.6-billion, accounting for 7.6 percent out of the country’s Total Exports of Goods and Services.

Inbound tourism also ranked third among the biggest exports in 2014, following miscellaneous services at 25.1 percent and semiconductors at 19.2 percent.

The DOT is targeting to grow this to P350.4-billion for full-year 2015 and an estimated P455-billion this year.

The aggressive growth of the industry is also pushing domestic tourism to new records, with total domestic receipts expected to hit P1.6-trillion in 2015.

From P1.469-trillion in 2014, the tourism agency is looking to grow this figure by 9 percent this year.

Enticing tour packages and low-fare packages of local airlines are fuelling the growth of domestic tourism, as well as a new-found appreciation of Filipinos for traveling, said Canizal.

With the tourism industry geared towards meeting its revenue target by 2016, this will also push a stronger contribution to the country’s gross domestic product (GDP).

The contribution of the tourism industry to the GDP has already grown by almost two percentage points since 2009.

According to data from the Philippine Statistics Authority (PSA), the share of the tourism industry to GDP, as measured by the contribution of tourism direct gross value added (TDGVA), grew to 7.8 percent in 2014 from 5.9 in 2009.

The DOT is looking to grow this to 8.7 percent by the end of this year and double digits in the short-term. 

“If you look at the figures, there has been a very steady increase in the contribution of tourism to GDP. We’re very confident that we will increase it to double digits in the next two years and bring tourism to a level that is what you see in highly developed tourism countries,”Bengzonsaid.

The TDGVA totalled P982.4-billion in 2014, a 14 percent increase from P861.7-billion in 2013. It already surpassed the P974.0-billion TDGVA target for 2015.

Accommodation services contributed the biggest share to TGDVA at 32.6 percent, followed by shopping of tourism goods at 15.3 percent.

Miscellaneous services were at 15.2 percent, transport services at 12.6 percent, entertainment and recreation at 10.9 percent.

Travel agencies and other reservation services shared 8.6 percent and the food and beverage services contributed 4.7 percent.

The TDGVA is based on the results of the Philippine Tourism Satellite Accounts (PTSA) and serves as a value-added measurement for all the tourism activities of domestic and foreign visitors in the country.

More than any other key economic aspect the government should focus on, according to Bengzon, is expanding the number of persons directly and indirectly employed in the industry.

The DOT is optimistic about the prospects for the travel and tourism industry in the country, citing opening of numerous hotels, resorts and casinos in the country this year and the next.

They are looking to grow employment in the industry to 6.3 million in 2015 and 7.4 million in 2016 coming from 4.758-million in 2014.

“That is very achievable. Employment is geometric. If it doesn’t happen by 2016, it will in the next two to three years. It is too tricky to predict but too exciting to watch,” said Tourism Secretary Ramon Jimenez in an earlier interview.

The percentage share of employment in the tourism industries to total employment in the country has grown to 12.5 percent coming from 11.1 percent in the last year of the previous administration, data from the PSA and DOT showed.

Passenger transport contributed to 35.6 percent of total employment in 2014, followed by 34.8 percent in the accommodation, food and beverage industry.

Entertainment and recreation shared another 7.4 percent, Retail Trade on Tourism with 6.6 percent and Travel Agencies 0.06 percent.

The Philippines is already among the top tourism employers in Southeast Asia, according to data from the World Travel and Tourism Council (WTTC).

The country placed third among its Asean counterparts in terms of number of jobs generated in the T&T sector, which include direct and indirect employment contributions to the industry.

Indonesia topped the list with around 9.81-million persons, with Thailand coming in at a far second, with an estimated 5.38-million employees in the T&T sector.
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