News Analysis Tourism

Resource-rich, operation-poor

Chocolate Hills of Bohol, Philippines

The Philippines with its spectacular white-sand beaches, its coral reefs exploding with tropical fish life; and inland, its natural wonders – from Mayon Volcano to the underground river at Puerto Princesa to the Chocolate Hills of Bohol (photo) – this archipelago of 7,000 islands would seem to have it all. And yet, despite this rich canvas splashed with colour here and there by historic sites recalling the bygone Spanish era, Philippine tourism continues to flounder – seemingly unable to get out of its own way.

The problem though is not what it’s got – it has more in terms of natural tourism resources than most places on Earth – it’s what its not got that’s the problem. And the tourist-arrival figures bear that out year after year after year.

No amount of misplaced Philippine outrage at those of us who criticise decades of failed tourism policies and rampant mismanagement across the industry is going to change that fact. No amount of inflated pride over how great the Philippine is can compensate for the way this industry’s God-given resources have failed to be exploited. The Philippines has to do more than just keep telling everyone it’s great; it has to show it; it has to deliver. And so far it never has.

The Philppines should be one of the world’s premier tourist destinations – for all classes of travellers. It’s not. On the global scale it barely registers. Let’s look at one year; 2014.

That year, 8.6 million visitors went to Taiwan’s capital, Taipei; the South Korean capital, Seoul, received 9.39 million visitors; 11.9 million made their way to the Turkish resort city of Antalya. Closer to the Philippines, the Malaysian capital, Kuala Lumpur, welcomed 11.63 million travellers; Shenzhen, China, 13.1 million; Macau, 14.97 million; Bangkok, Thailand, 16.25 million; Singapore, 17.09 million; Hong Kong, 27.77 million. All visitors to a single city in a single year.

In 2014, the number of tourists who made their way to the Philippines – all cities; all resorts – was 4.83 million. To put that bluntly, that’s just 17.4% of those who visited coral-reefless, tropical-fishless, beaches-limited Hong Kong. And there’s no way of putting a good complexion on that.

What Hong Kong does have is good food at prices that match every category of traveller’s budget; well-trained and informed hospitality workers; police who can be trusted not to kidnap or steal; cheap, clean and efficient transportation, and tap water you can drink.

We can already hear the defenders of Philippine tourism pride: “How dare people criticise our country!” Of course they dare; they’re tourists. They’re spending their hard-earned money and they demand value for it, and if the Philippines can’t provide that value then they’ll go somewhere else. Which is what they do year after year after year. And they’ll continue to for as long as the Philippines rests solely on the laurels of its natural resources.

And here’s why. In the World Economic Forum’s just released Travel and Tourism Competitiveness Report for 2017, the Philippines is ranked 37th out of 136 countries in terms of natural resources – 12 places ahead of Hong Kong (49th); 66 places ahead of Singapore (103rd).

An impressive showing. But not impressive enough to shore up its overall ranking which ended up as 79th, registering a five-place slippage from last year. In the Philippines’ immediate competition area, Southeast Asia, only Cambodia and Laos – both frontier rather than emerging economies – fared worse.

The Philippines also does well on price competitiveness – ranked 22nd, it leaves Singapore, 91st and Hong Kong, 113th, trailing in its wake. At the same time it remains well behind fellow Association of Southeast Asia Nations (Asean) members, Malaysia, 3rd; Indonesia, 5th; Thailand 18th. (The Asean states of Myanmar and Brunei are not included in the survey).

But as well as it did with natural resources and price competitiveness, it didn’t help much in terms of travel and tourism earnings which, after all, is what this business is about. Last year, from international tourism inbound receipts the Philippines pulled in US$5,276 million – compared to Thailand, US$44,553 million; Malaysia, US$17,597 million; Singapore, US$16,743 million; Indonesia, US$10,761 million; Vietnam, US$7,350 million. The only Asean countries of those surveyed that earned less were, Cambodia, US$3,130 million, and Laos, US$679.4 million.

We’re not suggesting that this report is the definitive analysis of Philippine tourism – it’s not. That said, it should still be appraised objectively. And clearly, it’s where the Philippines fares badly that needs to be addressed. The report’s Competitiveness Index assesses how “tourism friendly” each of the economies are by apportioning points to a series of categories and sub categories. Here’s a brief snapshot of how the Philippines did in three others.

Safety and security – a measure of the extent to which a country exposes tourists and businesses to security risks mainly related to serious harm to people (violence and terrorism). Petty crime is not taken into account. Here, the Philippines is ranked 126th – in other words, 10 places from the bottom; just nine places above war-ravaged Yemen and trailing every other Asean state. Drug-gang-infested Mexico was 13 positions ahead.

And, like it says, it doesn’t take account of petty crime for which last year in the Philippines there were 445,347 reported incidents. And, like it or not, the Philippines has an image problem when it comes to perceptions of honesty. Even locals are wary of wearing jewelry in public, fearing it might make them the target of thieves and street muggers. On top of that, given the number of scandals involving the Philippine National Police, law enforcement also isn’t a great advert for the Philippines.

Ground and port (G&P) infrastructure – availability of efficient and accessible transportation to key business centres and tourist attractions. The Philippines was ranked 107th – one place above Cambodia and four above Laos, the only two Asean countries it did better than. Apparently, according to the survey there’s better G&P in Bhutan, a country with a GDP (purchasing power parity) of US$6.4 billion, compared to the Philippines GDP (PPP) of US$801.9 billion.

Thankfully, at last, this is something that’s being tackled. President Rodrigo Duterte’s “Golden Age of Infrastructure” – the US$170 billion building bonanza that will equip the country with airports, ports, roads and networked railways – when completed, will provide the biggest boost that Philippine tourism has ever received. Of course, there’s been plenty of money available in the past, but much of it was either wasted or stolen.

Health and hygiene – this involves access to improved drinking water and sanitation. Also, “… the country’s health sector must be able to ensure [travellers] are properly cared for”. The Philippines was ranked 92 here. But while it has a better showing than three Asean states – Laos, Indonesia and Cambodia – this is not an impressive result. Hong Kong, 12 and Singapore, 62 may be out of reach, but how come it’s healthier and more hygienic for travellers in Nepal and Egypt of all places?

For locals, sanitation woes are well-documented. Around 55 people die as a result of poor sanitation and water-borne diseases each day in the Philippines where more than 90% of the country’s sewage is not collected or treated properly. More than 30 million Filipinos don’t have access to improved sanitation facilities; and of these, 7.8 million people, about 8% of the population, have no access to any sanitation facilities.

These problems and many more have beset Philippine tourism for years. They didn’t start with the current administration; they were handed on to it – part of a wretched legacy of failure that has stifled development and growth and hampered job creation into the bargain. While just 3.3% of the Philippine workforce is employed in tourism, Cambodia employs, 12.1%; Thailand, 6.3%; Vietnam, 5.2%; Singapore 4.3%; Malaysia, 4.2%; Laos, a tiny industry, 3.9%

The point in all this is that until the Philippines gets brutally honest about the shortcomings in its considerable tourism assets – that’s everything from transport links to the quality of the industry’s human resources to the ability to keep visitors safe – it wouldn’t really matter if the 8th, 9th and 10th wonders of the world were suddenly discovered there, visitors are still not going to arrive in the numbers needed to make this the booming sector it should be.

24 Comments

  • Principle of oligarchs and corrupt politicos is to keep the masses ignorant and poor so they can be easily controlled! The reason why they spend a fortune to oust the President who hates them!!!

    • Danilo Gutierrez, wake up pls. Duterte is surrounded by and co-exists with the oligarchs. The implementation of his policies are pro-oligarchs/rich. Haven’t you noticed? How come, for instance, despite the vaunted talent and techno-savvy of the Filipino, the country has among the world’s slowest internet, among the highest telco rates, and among the highest electricity prices? Answer: Bad oligarchs and their capture of government regulators.

      Why doesn’t Duterte talk to (I am not saying shame them) the owners of these telcos and energy companies and tell them point-blank—“lower your prices, improve your service or I will order you to report to Camp Crame!”?

      How come, despite the financial wizardry of the Filipino, the fact that more than P2 trillion of private deposits are lying idle at the central bank, and the huge pool of savings in this country (the savings rate is P4.8 trillion or 30 percent of the P16 trillion GDP or economic output), the Philippines has among the highest lending rates in the region and among the worst anti-small business practices? Answer: Bad oligarchs and their capture of government regulators.

      Did you know that only four banking oligarchs control 90 percent of the Philippine banking system? The local banking system used to be the largest in Southeast Asia. Now it is the smallest, thanks to oligarchic rule. Oligarchy also explains why more than 40 million Filipinos do not have a bank account. Each of the top-tier banks makes an average profit of P1 billion a MONTH—money that can employ 10,000 jobless Filipinos full time for A YEAR. Assuming a 12 percent tax rate (six times the average tax rate of an oligarch), each of the big banks can improve employment easily by 10,000 jobs every year by foregoing a tenth of their profits.

      Why doesn’t Duterte talk to the banking oligarchs and tell them “lower your interest rates, give loans to businesses at zero interest or I will order you to report to Camp Crame!”?

      Did you know that P3 trillion of private bank deposits are checking accounts for which the banks do not pay any interest to their depositors? If the banks were to lend 10 percent of that P3 trillion to SMEs, P300 billion in loans could go to small businesses—sari-sari stores, barber or tailor shops, small food and garment shops and other entrepreneurs who currently are at the mercy of loan sharks.

      Using his phenomenal persuasive powers on the true oligarchs of this country, Duterte can achieve financial inclusion and poverty reduction faster than lightning. The Philippines is unique in Asia, and in fact, in the world, for being the only major country that failed to halve its poverty in the past 20 years (from 26 percent to 27 percent). Why? Rule by the oligarchs. http://thestandard.com.ph/opinion/columns/virtual-reality-by-tony-lopez/212853/duterte-and-the-oligarchs.html

    • Tanga ka talaga! From today to tommorow e pwede bang mawala agad ang mga yan e kanila lahat? Bakit pinayagan nya c Gina na suspendehin ang mga minahan nila? Bakit nya nabuko ang Mighty? Bakit nabuking ang perks nila,ie oil companies? Bakit papayag sya na pumasok ang foreign telcos,etc,etc!

    • Correct po si Sir Gutierres, although me punto si mam Javellosa. Puede po itong pag usapan with open mind and heart ng walang damdsming masasaktan. Magkaisa po tayo higit sa lahat , tayoy pilipino ..

    • If our president is ousted in a not so normal way (extra judicial ) then we don’t have laws to operate on and eventually we will be in chaos.

      The only way to remove a sitting president is to impeach him, or he is resign or simply dead.

      Given that he controls both houses, then no possibility he be impeached. He will surely not resign given his popularity and control of PNP AND AFP. So the last chance is pray hard that he goes dead, by assassination or plane crash. Then BY OPERATION OF LAW, the VP will be P.

  • I do hope that something be done to address what ails our tourism industry. For all Filipino crabs, there’s no use for name-calling/blaming game as it will not help.

  • What hamper the tourism industry have long been known. “The Philippine tourism industry continued to lag behind its peers in the region as its development is being hampered largely by the lack of infrastructure, inadequate access for foreign tourists to reach the country and the relatively high cost of getting here.” http://business.inquirer.net/209249/ph-tourism-still-lags-behind-regional-peers A great aggravation, however, just came in with the new president. “The tourism secretary urged media Wednesday to “tone down” coverage of President Rodrigo Duterte’s deadly drug war, complaining that reports on extrajudicial killings were scaring away foreigners.” http://news.abs-cbn.com/news/03/22/17/drug-war-stories-scaring-foreign-tourists-ph-media-told-to-tone-down-reports

  • True. . . . . true . . . . . but what can we do? What we need is for people who believe that we can change this country to work together and not stopped until more than 50% of what volatilian said is addressed within this decade (2017-2027) and again to continue until everything is achieved.

    • Well, even if that VP is fake or more accurately is not the real VP as you stated, when our mahal na pangulo goes dead or incapacitated, the fake or not real VP, BY OPERATION OF LAW, will take the helm and be our LEGITIMATE PRESIDENT. Must be frightening to tourist indeed, I just don’t know if it’s the fake VP thing or she is next in line even if she, as you stated, is fake.

  • The problem with philippine tourism? Everything. Tourist seems to be expecting a standard when they travel and the standard is pretty much getting finer in details. If another country you may see a beautiful mountain under perfect accommodations, hassle free travel from airport to airport then why go to philippines to see also a beautiful mountain but hostage by worst accommodation, hazardous travel and worst airport protocols and on top of that is dangling thought that there are bandits wanting to cut your head off your neck if they ever captured you and you won’t pay ransom.