By Revin Mikhael D. Ochave, Reporter
THE DOMESTIC tourism sector is expected to reach pre-pandemic levels by 2024, although near-term challenges such as high inflation may affect demand, according to industry stakeholders.
“We consulted our members, we also talked to some experts, reports coming from United Nations World Tourism Organization (UNWTO) and many of them are really looking at 2024 as the year that we can go back to pre-pandemic levels. So, the next year and a half will be crucial,” Philippine Hotel Owners Association (PHOA) Executive Director Benito C. Bengzon, Jr. said in an interview with BusinessWorld Live on One News television channel on Monday.
The coronavirus disease 2019 (COVID-19) pandemic brought travel and tourism to a standstill around the world. The industry is slowly recovering as travel restrictions ease and COVID-19 cases drop.
Mr. Bengzon said he is optimistic that the tourism and hotel industry is heading towards recovery, after travel demand improves during the summer months.
“For the hotel industry, we have been registering very good occupancy rate in the last couple of months. This has been driven by the strong demand among Filipinos who are out on summer vacation,” Mr. Bengzon said.
Preliminary data from the Philippine Statistics Authority (PSA) recently showed that the share of the local tourism industry to the country’s gross domestic product (GDP) inched up to 5.2% in 2021 from 5.1% in 2020. However, this is still significantly lower than the 12.7% seen in 2019.
Tourism Congress of the Philippines (TCP) President Jose C. Clemente III said that most countries and industry experts are aiming to see travel and tourism to reach pre-pandemic levels by 2024.
“Of course, that will depend on some factors such as the war in the Ukraine and COVID-19 or new viruses that may come to light. If there is a resolution to Ukraine sooner than later and no new viruses, then travel and tourism should be okay,” Mr. Clemente said in a Viber message.
John Paolo R. Rivera, associate director at the Asian Institute of Management (AIM) – Dr. Andrew L. Tan Center for Tourism, said in a Viber message that the projection of attaining pre-pandemic levels by 2024 is “reasonable” but may have already factored in disruptions from the pandemic, global economy and other external factors.
“However, it is also possible to reach pre-pandemic levels as early as 2023 if no disruption will happen such as a surge, lockdown, war, political instability, and security threat. While it is not likely, we are living in a volatile, uncertain, complex and ambiguous world. Anything can happen,” Mr. Rivera said.
However, the spike in fuel and food prices may pose a challenge to the industry’s recovery.
“Any increase in oil will invariably affect prices of commodities and services across different sectors… This (oil hike) is a challenge but we don’t really see it as a dampener,” Mr. Bengzon said.
Mr. Clemente said that the industry has little control when it comes to inflation, which is expected to continue accelerating in the next few months.
“Coping with challenges such as inflation and oil price hikes, unfortunately, are external factors that the travel and tourism industry has little control over. The most we can do is to do our best to keep prices down as best we can but still continue to make acceptable margins,” Mr. Clemente said.
“We have to remember that tourism is also coming out from a two-year hibernation and we are just starting to get back on our feet. We also need to make back what we lost during the peak of the pandemic,” he added.
Mr. Bengzon said the local tourism industry needs to achieve an “optimum balance” to achieve recovery.
“We know that there’s still some restrictions on international travel. For domestic (travel), for us to really sustain this growth momentum, it’s really important that we’re able to contain COVID-19, to make sure that Filipinos who travel around the country observe health protocols,” the PHOA executive director said, noting that tourists from major markets such as South Korea, Japan and China are crucial to recovery.
According to AIM’s Mr. Rivera, the tourism industry’s recovery can be supported by encouraging more Filipinos to get their COVID-19 vaccines and booster shots.
“Everyone should get vaccinated and boosted, continue complying with minimum health standards so we can make sure that we are towards no alert level and avoid an increase in alert level so mobility continues to progress,” Mr. Rivera said.