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Room shortage forces Manila to turn away tourists

Written by editor

MANILA, Philippines – Lack of hotel rooms will force the Philippines to turn away tourists in the medium-term, a senior Tourism official on Tuesday said.

MANILA, Philippines – Lack of hotel rooms will force the Philippines to turn away tourists in the medium-term, a senior Tourism official on Tuesday said.

Besides resulting in lost revenues and opportunities, the capacity lack will make it more difficult for the country to meet its 5 million tourist target by 2010, Tourism Undersecretary Oscar Palabyab said.

“We cannot meet the target of 5 million foreign visitors by 2010…We don’t have the room for them anymore. We lack the capacity,” Palabyab told reporters while at the sidelines of the 34th Philippine Business Conference & Expo at the Manila Hotel.

Although the Philippines has 15,000 rooms for tourists, it needs 20,000 more for 5 million foreign visitors, he said.

“We will need huge investments for this requirement,” he said.

One option being explored is to improve the existing “mom and pops’ rooms and accommodations” all over the country. However, these facilities may only be able to supply a fourth of the additional lodging requirements needed by 2010.

Owing to the lodging lack, Palabyab added that the DOT is projecting that by 2010 only about 4.3 million visitors will be accommodated in the Philippines. Bulk of the country’s tourists will come from Korea, Japan, and China.

Last year, the Philippines attracted about 3.1 million tourists leading to tourism receipts of $4.885 billion. For the first six months this year, the Philippines attracted about 1.5 million tourists.

However, the Philippines is seen as among the least competitive countries in the region, placing sixth out of ten nations in terms of attracting tourists.

Room shortages make RP less attractive, more expensive

“The lack of rooms will also mean that the rates here in the country will be more expensive compared to the other countries in the region,” Palabyab said. “Another thing is that because we have higher rates for air transport. Those are the two things that we would have to address.”

Tourists may be inclined to choose either Malaysia, Thailand, and Indonesia over the Philippines as favored vacation spot.

In a phone interview, Jose Clemente 3rd, Philippine Travel Agencies Association (PTAA) president, said the country’s prime tourist destinations—such as Manila, Boracay, Palawan and Cebu—are the areas which usually have room shortages.

“There are certain seasons in which these areas needed more accommodations for tourists,” he said.

Clemente added that the government must find ways to make it easier for foreigners to invest in the country’s tourism industry.

Besides allowing foreign tour operators to enjoy tax holidays, the government should also consider liberalizing foreign ownership to encourage them to invest in the Philippines.

Currently, rooms in prime destinations need 30 percent more to take in all tourists, Clemente said.

Tourism sector has yet to feel impact of US crisis

Moreover, Palabyab said that the country has yet to feel the impact of the US crisis. Besides being a major trading partner, the US is also the Philippines’ second-largest source of foreign visitors.

“Our core market in the US are Filipino-Americans. Regardless of the economy, they will come home and visit their relatives here,” he said.

Currently, the DOT is focusing its marketing on Japan, China, Korea, and the Filipino-Americans.

Strategic markets include Australia, Russia, Germany and India.

Investments markets or those that need to be further developed were Hongkong, Taiwan and Singapore while “low-hanging fruits” or those which may be easier to penetrate are the UK, Italy, Spain, France and Scandinavian countries.

Experts have projected that world tourism will continue to grow with 1.5 billion people traveling by 2020.

In 2006, the top tourist destinations were France, Spain, US, China, Italy, United Kingdom, Germany, Mexico, Austria and the Russian Federation, respectively.

In the Southeast Asian region, the top tourist-generating countries were Singapore, Indonesia, Thailand, and Malaysia.