The hospitality and leisure sectors are anticipating a steadfast recovery as the Philippine government continues to relax domestic travel restrictions. More provincial and local government units reopened their borders to accommodate leisure travelers, along with increased vaccination rates, and a strong desire to revitalize the economy.
The national government has also updated the guidelines for foreign national entry, testing, and quarantine protocols. On February 3, the Inter-Agency Task Force for the Management of Emerging Infectious Diseases (IATF-EID) issued Resolution No. 160-B, which temporarily suspended the classification of countries, territories, or jurisdictions into “Green,” “Yellow,” and “Red,” and partially lifted the long-standing travel ban that has been in effect since March 2020.
As a result, the Department of Tourism (DOT) witnessed the continued recovery of the affected sectors, recording 202,700 foreign tourist arrivals in the first week of April this year. The Philippines became the first country in Asia to receive fully vaccinated foreign leisure travelers with the most relaxed entry protocol, including quarantine-free entry, while also allowing guests to travel freely to reopened destinations across the country.
Road to Recovery
Given the increased numbers of foreign tourist arrivals and domestic travels, hotels and resorts in the country’s key leisure destinations have enjoyed high occupancy rates during Holy Week, historically a peak period for domestic travels.
In Boracay alone, there were over 44,981 tourist arrivals recorded from April 11 to 17; with the highest being on Holy Thursday with 12,266 guests, according to Malay Chief Tourism Operations Officer Felix Gregorio Delos Santos. Diony Salme, chairman of the Boracay Foundation Inc., reported that most of the hotels/resorts have been fully booked last Holy Week.
The aforementioned results just indicate that 2022 is a “good recovery” year after observing a rise in the confidence level to travel among Filipinos.
According to the latest Economic Impact Report (EIR) from The World Travel & Tourism Council (WTTC), the rise of the tourism sector’s contribution to the Philippine economy in 2021 helped the country rank as the world’s fourth fastest-growing economy last year (WTTC). Philippine tourism’s economic contribution has increased by 129.5% by 2021, totaling $41 billion, or 10.4% of national GDP. Although the results are still far from the pre-pandemic level, the data indicates that Philippine tourism is rapidly recovering.
Changes in travel behavior
The effects of the pandemic have given the reason to reassess the long-term structure and transformational changes of tourism as a socio-economic activity. It also affected domestic and international tourism as well as travel patterns and tourist behaviors.
Following more than two years of covid restrictions, an increasing number of returning tourists are now favoring sustainable forms of tourism such as ecotourism and other nature-based activities. The majority of travelers are millennials who are eager to explore, seek out unique experiences, and search for places that were more colorful, youthful, instagramable, and vibrant. Similarly, local community members and business owners, among others, consider the environmental and socio-cultural aspects of tourism development, such as green resorts and hotels and community-based tourism activities.
Along with the resurgence of travelling is the market’s desire for excellent dining options and experience. According to the Philippine Statistics Authority (PSA), spending in the restaurant and hotel segment increased by 5.1% in 2021 from a 43.1% contraction in 2020.
Adapting to changes
Although a full recovery is not yet on the horizon, it is being evident that the industry is constantly changing. Tourism must provide safer travel options, which include a shift toward outdoor, nature-based, and disaster-resilient travel, aside from emphasizing sanitary practices.
Market for Workcation
Working remotely is now a commonplace for many employees and is expected to become more than a passing trend. As a result of the global public health crisis, an unprecedented number of companies started to adopt a hybrid or flexible approach to working remotely.
This means that hospitality establishments are being used as makeshift offices for leisure travelers as well as locals looking for a change of scenery to recover from cabin fever. This is an excellent opportunity for hotels and food & beverage establishments to capitalize on the trend and adapt their offerings to meet the needs and desires of this emerging segments.
Holistic well-being
Due to the pandemic, preventative medicine and self-care are definitely on the rise. The wellness industry is transforming into a thriving market, and hospitality venues, particularly those with existing spa facilities, are well-positioned to take this opportunity.
Aside from the standard beauty and relaxation spa offerings, there is a rapidly growing demand for health diagnostic technology and bespoke treatment plans delivered by experts who conduct personal or group sessions to develop vitality, healing, stress management, emotional balance, mindfulness, and better sleep.
Sustainability at its finest
Global warming can be viewed as a major risk for both corporations and society as a whole. As travelers’ awareness of environmental and social issues grows, corporations and establishments must develop more sustainable business models.
The hallmark of recent year’s hospitality trend, “sustainability”, has played a significant role in the industry today. More far-reaching ethical and environmental considerations are shaping decisions made at the hospitality management level, such as a natural extension of avoiding disposable plastics, eliminating unnecessary paper consumptions, and reducing food wastes. Simple eco-friendly changes include replacing miniature toiletries with larger, locally sourced dispensers, selecting ethically produced bedsheets made of organic materials, and lowering energy consumption with smart bulbs, etc. vegetarian and vegan options have well-known environmental benefits.
To ensure broad participation and consensus-building, sustainable tourism development necessitates the informed cooperation of all relevant stakeholders, as well as strong political leadership. Achieving sustainable tourism is a continuous process that requires constant monitoring of impacts and the implementation of necessary preventive and/or corrective measures as needed.
Despite the fact that the pandemic has changed the way how people interact and live, the hospitality and tourism sectors must respond, prepare, and adapt in order to thrive in a post-COVID environment. Sustainable tourism is about re-focusing and re-calibrating, therefore, the need for sustainable planning and management is imperative for the industry to survive as a whole.
Written by: Mary Grace Ladringan
Aviso Valuation and Advisory Corp. is a real estate consultancy firm that offers valuation and business advisory services compliant to international standards such as the International Valuation Standards (IVS) and International Financial Reporting Standards (IFRS). To assure that we only produce high-quality deliverables, as needed, we do tasks beyond the usual appraisal process like verifying pertinent property documents (i.e. land titles, tax declarations, etc.) with the appropriate government agencies for due diligence purposes prior to the acquisition of the properties.
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References:
https://www.pna.gov.ph/articles/1172378
https://www.esquiremag.ph/life/travel/philippines-travel-tourism-recovery-economy-a00304-20220420
https://hospitalityinsights.ehl.edu/hospitality-industry-trends
