Tourism in the Philippines is a significant industry. In 2000, tourism only had a 5.6% share in the country’s Gross Domestic Product (GDP); now it stands at 12.7%. The tourism industry generated P465 billion in 2019 and currently employs 5.71 million people, or 14 out of every 100 employed in our country.
Unfortunately, according to the National Economic and Development Authority and the Department of Finance, tourism is the second hardest hit industry by the pandemic.This is reflected in the revenues of the first four months of 2020 — P79.8 billion, down from P180.5 billion from the same period in 2019. Because of this development, we must rethink, reorganize, and restructure tourism in our country.
Thankfully, under the decisive leadership of Secretary Bernadette Romulo Puyat, the Department of Tourism (DOT) already has plans on how to address the fundamental changes that the new normal will require. Secretary Romulo Puyat shared these plans during a Learning Session on Economic Stimulus for Business Continuity and Recovery that was held this past week, which I attended as a guest speaker.
Their Response and Recovery Plan addresses how to mitigate the expenses of tourism establishments by having a moratorium on accreditation fees, facilitating wage subsidy programs for tourism workers, deferment of contributions to SSS, PhilHealth, and other similar programs. The DOT is also pushing for actions that will protect tourism-oriented MSMEs, such as interest-free loans or the issuance of loan guarantees with terms of up to five years, and credit facilities for upgrading tourism establishments to be compliant with COVID-19 guidelines, all through government financial institutions. There will also be marketing and product development programs, grants for education and training for new alternative livelihood programs, the use of information technology to improve tourism and tourist tracking services, and other relevant programs.
The Board of Investments (BOI), following discussions with the DOT, has also crafted the following policies. The BOI will grant income tax holidays for a period of three years, and duty-free importation of capital equipment for tourism projects that will enhance health and safety features and processes. It is also encouraged that improvements to make tourism facilities COVID-proof be registered as modernization projects subject to qualification requirements. Hotels, resorts, MICE (Meetings, International Conventions, and Events) facilities, and tourist transport companies are also eligible to apply for investment incentives.
These preparations by the DOT and BOI will help upgrade our tourist destinations. However, it also asks the question of how our country will restart international tourism. One mechanism that is gaining ground is the concept of a “travel bubble.” Travel bubbles are the shorthand term for renewed tourist travel between countries that have the COVID-19 pandemic in sufficient control. HSBC recently came out with a report that Vietnam, Thailand, Singapore, and Malaysia were potential candidates, as many travel bubbles are still being set up as of mid-June.
Thailand, for example, is considering travel bubbles with nations where COVID-19 is largely contained such as China, South Korea, and Vietnam, although initial travel may be focused more on medical and business purposes. Vietnam is planning to bring in international visitors on a trial basis, with Phu Quoc island as the test destination. International tourists will have to undergo COVID-19 tests, but they will be able to move freely on the island – but only there. Other countries that are also developing travel bubbles are Japan, Australia, and New Zealand.
The coordination and operation of travel bubbles, however, will not be easy. It requires that medical facilities be set up or upgraded in the tourist destinations themselves. And in order for other nations to trust us, we have to conduct mass testing, and put an effective contact tracing system in place. Only by showing that we are bringing our COVID-19 numbers down can we convince potential travel bubble partners that we are ready. We have to efficiently use our resources – and that’s why we have to study and our planned stimulus programs, and allocate budgets properly.
The post-COVID world, the New Normal, or whatever else it will be called, requires that we open our minds, master our resources, and adapt. We must show the world that we can handle and minimize the pandemic, that we are prepared to keep tourists safe and sound.
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Senator Sonny Angara has been in public service for 15 years—9 years as Representative of the Lone District of Aurora, and 6 as Senator. He has authored and sponsored more than 200 laws. He is currently serving his second term in the Senate.