One of, if not the biggest sectoral impact the ‘Golden Age of Infrastructure’ – Philippine President Rodrigo Duterte’s PHP8 trillion mega-spend on transportation projects across the archipelago – will have, will be on the country’s tourism industry. Indeed, without it this sector’s potential is likely to dwindle and eventually become overwhelmed by its regional rivals.
Already outpaced by its main tourism competitors within the Association of Southeast Asian Nations (Asean), if the infrastructure neglect of the past were allowed to continue, it wouldn’t be long before it had to fend off challenges from the region’s more-frontier economies of Cambodia, Myanmar and Laos.
Given the Philippines’ abundance of natural resources and scenic destinations, tourism should be one of the leading contributors to gross domestic product (GDP). In 2015, it directly accounted for 4.2% of GDP; in cash terms that contribution was US$11.28 billion.
To put that in perspective the Philippines’ niche sector of business process outsourcing (BPO) – an industry that’s barely 15 years old locally – generated revenues of US$22 billion in 2015. Of course, BPO’s success, unlike that of tourism, isn’t reliant on physical infrastructure such as roads, ports and airports. So let’s compare apples with apples. In 2016, Thai tourism brought US$71.4 billion into its economy – 10% of GDP.
In the World Economic Forum’s 2017 Travel & Tourism Competitiveness Report, the Philippines’ rankings in two physical infrastructure categories – ‘Air transport infrastructure’ and ‘Ground and port infrastructure’ – make grim reading and graphically illustrate why Duterte’s build-out of the country’s roads, ports and airports is vital if Philippine tourism is going to become a solid and reliable structural pillar of the economy.
Within Asean – ex-Brunei and Myanmar which aren’t covered by the survey – the Philippines comes second from last in both categories; in both cases beating just Cambodia and Laos. Here are those states’ rankings out of 136 countries worldwide.
Air Transport Infrastructure: Singapore, 6th; Thailand, 20th; Malaysia, 21st; Indonesia, 36th; Vietnam, 61st; Philippines, 65th; Cambodia, 96th; Laos, 97th.
Ground and Port Infrastructure: Singapore, 2nd; Malaysia, 34th; Indonesia, 69th; Vietnam, 71st; Thailand, 72nd; Philippines,107th; Cambodia, 108th; Laos, 111st.
Of course, everyone knows about the wretched state of transport infrastructure in the Philippines – people have been talking about it for decades. Unfortunately that’s about all they’ve been doing. Congressmen over the years have used some of their pork-barrel funding to stick a few roads in here and there in the hope of being rewarded at the ballot box later, but there’s never been a comprehensive pan-archipelago infrastructure programme. That’s why Duterte’s “Build! Build! Build!” is so important.
And not least to tourism – a sector that should shine but that’s been consigned to the shadows for one excuse or another. The Philippines lacklustre tourist-arrivals numbers – lacklustre by the side of those of major rivals – can to some large degree be traced to the wholesale inadequacies of its roads, transport systems, ports and airports.
Let’s put it in very simple terms. If a family has two weeks overseas holiday in a year, they don’t want to be spending several days of that in less-than-efficient transport on broken, traffic-choked roads in 35 degrees heat. It didn’t mention any of that in the travel brochure. And they’re not likely to be coming back to re-live the experience.
Our picture shows traffic on the Mactan to Mandaue Bridge in Cebu, one of the most popular destinations in the whole of the Philippines for foreign tourists.