The Philippine tourism sector may return to pre-pandemic levels amid the steady growth and recovery of international flights and tourist arrivals in the third quarter of 2023, but broad recovery may have to have to happen in 2024 yet, a property management and consultancy firm said.
Leechiu Property Consultants Inc. (LPC) said that its Third Quarter Property Market report showed that overall recovery is expected in 2024 yet. "2024 is anticipated to be the year in which broad indicators in the global tourism industry (e.g. tourist arrivals, flight capacity, and hotel occupancy rates) finally recover to pre-pandemic levels," the consultancy firm said.
As of Sept. 30, international tourist arrivals have reached over four million or 84 percent of the Department of Tourism (DOT)’s 4.8 million target international tourists for 2023. Majority of the tourists were from key source countries like South Korea, the United States of America (USA), and Australia.
However, the country has seen significantly lesser tourists from Japan and China. For China, LPC said “limited international flight capacity from China, which is only 50 percent of the pre-pandemic levels, extended approval times for travel visas, unemployment rates among 21 percent of Chinese youth, sluggish economy, and strained political relations” may have hindered the number of Chinese tourist arrivals.
Meanwhile, the low arrival numbers for Japanese tourists may be attributed to “lingering concerns over Covid-19 cases, surge in domestic travel in Japan, and the Japanese Yen reaching a 32-year low, below $150.”
According to LPC, greater private sector investment in additional hotel accommodations can help sustain growth in the tourism industry and strengthen international tourism beyond 2027 as the DOT targets 12 million international arrivals for 2028.
At present, around 15,000 new hotel rooms, primarily in the National Capital Region (NCR), are expected to be created within the next five years, with other hotel projects to be announced soon.
The firm said creating more localized airports have increased the demand for hotel developments in Cebu, Clark, Davao, Bohol, and Palawan, citing around 1.6 million visitors to Panglao in 2019 after the Bohol-Panglao International Airport opened in 2018.
Compared to the 2 million tourist arrivals in Boracay, it said Panglao Island may soon be able to “surpass Boracay Island as the country’s premier tourism destination,” given the figures.
LPC Director for Hotel, Tourism, and Leisure Alfred Lay, Panglao has a larger size and capacity limits unlike Boracay. He highlighted the proposed 50-hectare Panglao Shores project, JW Marriott Hotel, and the Cebu-Bohol bridge as infrastructures that would help scale up the islands’ services and amenities.
Further developments to Panglao has resulted in increased land values, with the “Alona Beachfront properties now priced at approximately P80,000 to P120,000 per square meter, approaching the land values in Boracay’s white beach area,” said the firm.
Despite these, LPC still emphasized that “industry stakeholders should look out for certain trends that can greatly impact the Philippines in the coming year, including the relaxation of visa restrictions, persistent high airfares driven by escalating aviation fuel costs, ongoing inflation, a high-interest rate environment that may leave consumers with diminished purchasing power, and the return of business travel and MICE (Meetings, Incentives, Conferences, and Exhibitions) events.”