THAILAND: Thailand Approves New Phuket Airport For 10 Million Additional Tourists

Phuket International Airport
Thailand’s Maya Bay, the beach made famous by Leonardo DiCaprio, officially closed to tourists for four months on June 1, becoming the latest addition to a growing list of destinations that have become victims of their own appeal.

Others include Boracay, in the Philippines, which is almost six weeks into its six-month hiatus, and Koh Tachai, another Thai island, which stopped receiving visitors in May 2016, although it has since reopened.

How, then, do officials in Thailand hope to combat the problem of overtourism led by a sharp increase in the number of Chinese travellers? By investing in infrastructure to facilitate yet more arrivals, of course.

Airports of Thailand, which became the world’s most valuable airport services company earlier this year, recently approved second airports for Chiang Mai and Phuket.

With a combined budget of 120 billion baht (US$3.7 billion), construction on both is expected to begin next year, with completion slated for no later than 2025.

Any one of the 3.5 million passengers who passed through immigration at Phuket International Airport in the first four months of this year might welcome the news.

That figure represented a not insignificant 19 per cent rise on the same period in 2017, according to a report by hospitality consulting firm C9 Hotelworks.

But Phi Phi Leh, home to Maya Bay, Koh Racha Yai and Koh Khai Nok – all favourite destinations for Chinese tour groups and individuals from Phuket – may be less accommodating to an additional 10 million visitors a year.

The economic rewards for such investments are obvious the tourism industry accounted for 9.2 per cent of Thailand’s GDP in 2016, a contribution that is expected to grow to 14.3 per cent by 2027, as detailed in a report by the World Travel & Tourism Council.

However, even high-ranking officials have expressed concerns over the country’s aggressive approach to tourism.

Science and technology minister Suvit Maesincee said: Our strategy was more for less, not less for more, so we invited a lot of tourists from China. I think in the near future we need to change from volume to value.

We are trying to push for CBT or community-based tourism to disperse tourists away from popular sites beyond Bangkok, Chiang Mai or the beaches to promote the unseen Thailand, said Jiraporn Prommaha from the Ministry of Tourism and Sports, speaking to travel industry publication TTG Asia.

Building additional airports at two of the country’s most popular entry points might not seem an obvious strategy for the dispersal of tourists, but who are we to judge!


Tourism Observer

PHILIPPINES: Attack At Manila Casino Resort To Scare Tourists

A gunman fired shots from an assault rifle and set fire to gambling tables at Resort World Manila, resulting in the deaths of dozens of people. The attacker, whose motives are so far unclear, later killed himself, authorities said.

Attacks of this scale are rare in Manila, especially in upscale areas frequented by tourists, which typically have heavy security.

Philippine officials say they don't believe the assailant was motivated by terrorism. But the attack on a major hotel and casino complex near the capital's international airport could still hurt tourism, a key source of income for the developing country.

Nearly two-thirds of visitors to the Philippines in February flew into Manila, according to the country's Department of Tourism, making it the country's biggest arrival hub.

People get good bang for their buck in the Philippines, said David Beirman, a senior lecturer specializing in tourism at the University of Technology Sydney.

But safety and security is now the number one factor in determining where tourists go. It used to be things like value for money, but that's changed. In the short term the attack in Manila is clearly going to have a negative impact on tourism.

Shares in Travellers International Hotel Group, the company that runs the Manila resort, plunged almost 8% on Friday.

The attack's potential reverberations in the tourism industry could spoil a good run for the sector.

The Philippines has experienced a surge in visitors since 2010.

Experts say that's thanks to the relatively stable political environment under former President Benigno Aquino III, as well as a marketing drive by the tourism board and the introduction of the country's first low-cost carrier, Cebu Pacific.

Just under 6 million visitors flocked to the Philippines last year, roughly triple the number that arrived in 2000.

Travel accounted for about 8% of gross domestic product in 2016, according to the World Travel & Tourism Council. That's higher than the 3%-5% average of most countries, said Bob McKercher, a professor of tourism management at Hong Kong Polytechnic University.

Tourism numbers have remained strong under President Rodrigo Duterte, who took office in May 2016 and has made headlines with his aggressive war on drugs.

Recent attacks on tourist targets in the Philippines, often involving kidnappings, have typically been concentrated in the southern region of Mindanao, which is home to Islamic militant groups.

More than 100 people have been killed recently in one Mindanao city, where fighters affiliated with ISIS have been engaging in violent clashes with government forces.

Attacks on tourist areas have hurt visitor numbers in other countries. A string of terrorist attacks in Turkey have seriously damaged the country's tourism sector.

The number of tourists entering the country via airports fell 21% in 2016, according to travel intelligence firm ForwardKeys.

But some countries' tourism industries have rebounded quickly following violent attacks.

France hosted 56.3 million visitors on overnight stays in the last quarter of 2016, a 3.9% rise compared with the same period the previous year, according to government figures.

The recovery followed two difficult years for the sector following a series of extremist attacks.

Germany, Russia But Not UK, Allow Their Airlines To Fly To Sharm el Sheikh again

World Travel & Tourism Council and the World Tourism Organisation have added their voices to calls on the UK government to lift the current ban on UK-based airlines flying to Sharm el Sheikh.

In a letter to UK prime minister Theresa May, WTTC president David Scowsill and UNWTO general secretary Taleb Rifai stressed the importance of resuming operations to the Egyptian coastal resort as the current travel advisory is having devastating effects on the country’s economy and social stability.

The ban has been in place since a Metrojet airline flying from Sharm el Sheikh to St Petersburg crashed in the Sinai Desert in October 2015.

They letter read: “Tourism is vital to Egypt’s economy and social peace, contributing 11 per cent of the country’s GDP and 2.6 million in jobs in 2015.

“The reduction of visitors has created huge employment losses.

“The country’s biggest concern is how the lack of employment opportunities, especially for young men and women, has instilled a desperate disposition and thus vulnerability to radicalisation or to fleeing on a refugee boat.”

Egyptian authorities have taken significant measures to step up the level of security not only in the airport but in the surrounding area as well, argued the trade bodies.

These improvements now meet the safety standards as indicated by the UK department for transport.

All other countries, including Germany and Russia, have allowed their airlines to start flying to Sharm el Sheikh again.

They letter concluded: “It is devastating to see the impact the current UK travel advisory has on Egypt and on the young workforce in particular.

“We call on the UK government to review the advisory and allow commercial aircraft to fly to Sharm el Sheikh and thereby help restore the country’s tourism sector’s GDP and employment provision.”

USA: Orlando Mourns, But Tourism Likely To Grow

The city of Orlando, Florida, has banded together following Saturday night's devastating attack at Pulse nightclub, which left 49 victims dead and dozens more injured.

Yet as residents focused on supporting one another during a state of emergency, experts said the crux of the city's economy — the tourism industry — is unlikely to deliver the state a second blow.

"The travel industry is always having disruptions," said David Scowsill, president and CEO of the World Travel & Tourism Council. "In general terms, it is incredibly resilient."

Scowsill said in general, when city centers experience isolated acts of violence not aimed directly at tourists, "things go back to normal very quickly." He pointed to the 2005 London transit bombings as an example. In contrast, the tourism industries in Egypt and Tunisia have recently struggled, as they've both suffered from attacks aimed specifically at travelers, Scowsill said.

Paris, where more than 100 people were killed in November, has likewise not been immune to fallout from the recent attacks. Data compiled by the National Institute of Statistics and Economic Studies found that overnight stays among foreign travelers declined 6.3 percent there during the first quarter, as compared with the prior year.

Separate data from the Paris Convention and Visitors Bureau found the hotel occupancy rate there fell 6.2 points during the first quarter, to 61.7 percent, compared with the first quarter of 2015 (when the attacks against Charlie Hebdo, the French satirical magazine, took place).

Yet such drops are often short-lived, Scowsill said. Back in 2002, when a nightclub bombing in Bali killed more than 200 people, the tourism industry initially cratered; but it began to recover roughly a year later. Likewise, a spokesman for the Paris tourism bureau said the organization "could feel there was a slow recovery" in the city during the first quarter. Still, he cautioned April is expected to be weak due to the shift of Easter into March and the city's proximity to Brussels, where three coordinated nail bombs went off in April.

Though Scowsill predicts there will be a few weeks of people hesitating before booking a trip to Orlando, he does "not expect a huge amount of cancellations" for already planned trips, he said. That's because law enforcement and the local government quickly and effectively communicated information about the shootings, which were put to a stop when the suspect was killed.

Damian McCabe, CEO of McCabe World Travel, said her firm does not have "any comment beyond that we don't anticipate this sad event effecting tourism to Orlando in the long run."

A spokesman for Delta Airlines said the company has not had a change to its Orlando flight operations since the shooting. At JetBlue Airways, a spokesman did not say whether the airline has seen any cancellations on flights to Orlando, but said it is providing free seats on available flights to and from the area for immediate family and domestic partners of victims who were killed or injured.

A spokesman for Universal Studios, which like CNBC is owned by NBCUniversal, said "the safety of our team members and guests is always our top priority — but we do not discuss the specifics of our security plans and procedures."

Walt Disney World said in a statement, "Unfortunately we've all been living in a world of uncertainty, and during this time we have increased our security measures across our properties, adding such visible safeguards as magnetometers, additional canine units, and law enforcement officers on site, as well as less visible systems that employ state-of-the-art security technologies."

The Orlando nightclub attack comes just one month after the city's official tourism association said it set a record for inbound travelers last year. According to Visit Orlando, the Central Florida city received 66.1 million visitors last year, representing a 5.5 percent over the prior year. That also made it the most visited U.S. city for tourists last year.

These visits contributed to record tourist development tax collections in Orange County — home to the region's tourism district — which last year topped $230 million.

The leisure and hospitality industry is the greatest employer for non-agricultural jobs in Orlando, at 20.9 percent, according to the Orlando Economic Development Commission. There are multiple projects underway in the area for new attractions, including the Volcano Bay water park coming to Universal Orlando next year.

As for the overall state of Florida, tourism spending contributes $89.1 billion to the economy, and accounts for roughly 6 percent of its gross domestic product. The industry employees 1.2 million Floridians

Growth In Tourism

The tourism industry is fueling a global economic boost thanks to the addition of 7.2 million jobs worldwide last year. According to the annual economic impact report from the World Travel & Tourism Council (WTTC) released on Monday travel and tourism supported 284 million jobs, that’s one in every 11 jobs internationally.

“Despite uncertainty in the global economy and specific challenges to travel and tourism last year, the sector grew by 3.1%, contributing a total of 9.8% to the global GDP,” David Scowsill, president and CEO of the World Travel & Tourism Council said.

He added, “Terror attacks, disease outbreaks, currency fluctuations and geopolitical challenges have impacted the sector at a country or regional level, but travel and tourism at the global level continues to produce another robust performance.”

The growth in the travel sector may come as a surprise in light of the recent terror attacks abroad in Paris, the 2014 Ebola outbreak and newest disease threat; the Zika virus. According to the latest report from the Centers for Disease Control and Prevention (CDC), there are currently 116 confirmed Zika virus cases in the United States alone.

According to the report, over the next 10 years the tourism industry is on track to continue to improve the world economy with an anticipated 4% growth annually.

The research found countries where the tourism sector surpassed the economy in 2015 in relation to the national GDP included Iceland, Japan, Mexico, New Zealand, Qatar, Saudi Arabia, Thailand, and Uganda. The top 10 fastest growing regions are Southeast Asia with 7.9%, followed by South Asia 7.4%, the Middle East 5.9%, Caribbean 5.1%, Sub-Saharan Africa 3.3%, North America 3.1%, Europe 2.5%, Northeast Asia 2.1%, Latin America 1.5% and North Africa 1.4%.

The WTTC report shows the growth of the industry is a direct result of a global increase in middle-class households and aging population, which tend to travel more, in addition to the “growing connectivity between destinations, making travel more accessible and affordable.”

Research also reveals the power of the U.S. dollar contributing to growth in the Americas, with United States outbound travel and tourism expenditures rising by 6.3% in 2015. On the flip side, the strong dollar has limited travel by foreigners to the U.S., which has put pressure on U.S. companies, especially luxury retailers like Tiffany (TIF), Nordstrom (JWN), and Neiman Marcus where those visitors typically spend more.

The annual reports from the World Travel & Tourism Council provide economic data from the travel and tourism sector on an international level which includes 184 countries and 24 regions.

CHINESE: Chinese Tourists Spend $215 Billion Abroad On Tourism

China's growing middle class is splashing record amounts of cash on foreign holidays, boosting economies as far apart as Japan and Iceland.

Chinese tourists spent $215 billion abroad last year, 53% more than in 2014, according to a report from the World Travel & Tourism Council. That's more than the annual economic output of Qatar, and Chinese tourists are now spending way more than anyone else, including Americans.

The number of Chinese tourists traveling internationally has more than doubled to 120 million people over the last five years, according to data from the China National Tourist Office and WTTC. That means one in every 10 international travelers now comes from China.

"The growth of Chinese tourists traveling abroad has been extraordinary," David Scowsill, CEO of WTTC. "A lot of this growth is stimulated by more and more people coming into the middle class."

Chinese people tend to begin traveling abroad once their household earns about $35,000, Scowsill said. Between 2003 and 2013, about 21 million households crossed that threshold, he said. Another 61 million households are expected to achieve those earnings by 2023.

China's tourism boom is partially a result of government initiatives to encourage travel, such as building new airports. It's all part of a bigger government plan to boost consumer spending and make the economy less dependent on manufacturing.

Chinese people tend to prefer traveling around Asia when they first set foot outside the country, but lately they've become more adventurous and are going further afield, said Scowsill. Europe and the U.S. are popular options.

Older travelers tend to prefer organized group trips, but the Internet-savvy younger generation prefer to strike it out on their own, said Scowsill.

The boom in Chinese travel has hugely benefited Japan, leading to a 49% jump in revenue from foreign visitors in 2015, according to WTTC data.
"It's almost taken the Japanese by surprise by how successful they've been," said Scowsill. A fall in the value of the Japanese currency has attracted foreign tourists.

Iceland is another country whose economy is getting a lift from an influx of Chinese visitors. WTTC data shows Iceland's travel and tourism sector grew by 19.4% in 2015, significantly outpacing the overall economy.

FRANCE: Paris Tourism Affected Temporarily But Will Recover Soon

Paris tourism took a hit in the weeks following the Nov. 13 terror attacks, with a 12 percent drop in hotel occupancy for the month of November and Air France reporting $54.5 million in lost revenue.

But airfare prices are holding relatively steady, and some reports suggest the downturn could level off in the new year barring further incidents.

Here are some snapshots from various sectors of the travel industry.

Air France reported November traffic to and from Paris was "significantly impacted" with a "negative impact" on revenues of around 50 million euros (about US $54.5 million). But Air France also said booking trends suggest a "progressive recovery" including "limited impact" in the new year.

The travel data company ForwardKeys said in a Nov. 24 report that new air passenger bookings for future arrivals were 27 percent below 2014 levels.

The Airlines Reporting Corp. reported declines in air ticket sales of around 11 percent the week after the attacks and 8 percent the week of Nov. 22-28. ARC says its data represents about 50 percent of air tickets sold.

The ARC also found the price of round-trip U.S.-Paris economy flights during the second week of December dropped nearly 5 percent year over the year, from $1,209.50 in 2014 to $1,152.52 in 2015.

For Christmas week, though, CheapOair.com, an online booking site, found average round-trip international airfare to Paris, unchanged between 2014 and 2015, at $966.

Bottom line: Air traffic was down in the immediate aftermath of the attacks, but if you're looking for future airfare bargains, you're out of luck so far. George Hobica, founder of AirfareWatchdog.com, says the attacks "have had no appreciable effect on fares to Paris."

The U.S. dollar is worth more against the euro than it was a year ago, however, so that may be masking slightly higher airfares for prices set in euros.

November hotel occupancy rates for Paris decreased 12 percent for the month compared with the previous year, according to STR Global, which tracks hotel data.

Nightly hotel occupancy rates in the two weeks following the attacks ranged from 22 to 39 percent lower than the same dates in 2014, STR said. But there was an uptick at the end of November as climate conference attendees began arriving, STR reported.

JacTravel, a wholesale hotel room buyer, said hotels have so far been "reluctant" to drop rates and instead were offering upgrades, discounts and special rates for dinner with hotel stays. The company said in a statement that hotels will likely wait until after the holiday period in January before deciding on future pricing.

Travel Leaders Group, one of the largest travel agencies in the U.S., reported that Paris dropped out of its top 10 list of destinations for the new year for the first time since 2011, coming in at No. 11 for 2016. In a survey by the company, 20 percent of its travel agents said their clients had delayed or canceled trips to Paris; 24 percent said clients were continuing with plans to travel to Paris; and the rest had no bookings for November or early December.

The World Travel & Tourism Council predicts that the attacks' impact will be short term. "We expect destinations where tourists were not specifically targeted, such as Paris, to recover rapidly after the initial shock," the WTTC said in an email.

The organization noted that arrivals to Spain following a train bombing in Madrid in 2004 recovered within weeks, and that a train bombing in London in 2005 "had no notable impact on tourist arrivals." In contrast, bombings in Indonesia in 2002 and 2005 that targeted tourist areas did lead to a downturn in tourism.

SOUTH AFRICA: IATA Welcomes Visa Changes

The World Travel & Tourism Council (WTTC) would like to congratulate the government of South Africa for adopting new visa policies that will see the implementation of biometric visa applications on arrival and changes to the unabridged birth certificate policy.

The new recommendations that were presented by the inter-ministerial committee were accepted by Cabinet last week and will be implemented over the next three months to over a year.

David Scowsill, president and CEO of the WTTC, said the organisation is extremely pleased that the South African government has decided to adopt new visa policies that ensure a smoother visa application process for business and leisure travellers that are looking to visit this great destination.

"South Africa is a rich tourism economy, in 2014 our sector contributed 9.4% to the country’s total GDP, which accounts to a total of R357bn, a number which is expected to grow by 3.4% in 2015. We commend the government, specifically Tourism Minister Derek Hanekom and Home Affairs Minister Malusi Gigaba, for the quick response to address the dropping visitor arrivals figures," said Scowsill.

"The change in the country’s visa policies are necessary for the country to continue to grow its travel and tourism sector and meet its forecast travel and tourism GDP."

He said in order to benefit from the great economic and social benefits of the sector WTTC encourages governments to provide visitors with a safe and smooth passage, which means adopting smarter visa processes, more visa waiver agreements and trusted traveller programmes.

"The announcement by the South African government is an important step in the right direction. However, it is important for the government to ensure these changes are implemented in a timely and appropriate manner and that the government continues to look for ways to improve its visa processes. There is more scope for the government to attract a higher number of visitors through more favourable visa policies,” he cautioned.

In the next three months medical travellers and visitors from countries that have no South African mission can apply for a visa by post rather than having to appear in person at centres to apply for a visa. In this same period the government will also start collecting biometrics at the port of entry.

After three months to a year, South Africa will be expanding the number of visa facilitations centres in key countries while after a year the government will move towards a pre-flight biometrics checking system at international airports.

Furthermore, foreign travellers under 18 no longer have to carry copies of an unabridged birth certificates. South African minors have to continue to bring a certificate when they travel, though the name has changed to a “birth certificate containing parental details” as to avoid confusion.

This certificate can be printed in passports, which means that parents no longer need to carry birth certificates on them. The government will implement these changes within the next three months to a year.

The International Air Transport Association (Iata) also welcomed the South African government’s decision to amend some of its visa and immigration requirements.

"We believe this is a positive move in the right direction. We urge the South African government to communicate the changes clearly, expeditiously and effectively to all markets so that there is no confusion. This will require far greater clarity on the dates from which the amendments will become effective," said Raphael Kuuchi, Iata's vice president for Africa.

"It is crucial the changes are implemented quickly, to avoid further lost opportunities for South Africa’s travel and tourism sector, which has already been damaged and will experience a notable downturn in business over the coming high summer season, traditionally the sector's busiest period of the year."

In his view the speedy adoption of the amended requirements will also support the combined marketing campaigns led by airlines and their tourism industry partners which aims to restore consumer confidence in South Africa as a value-for-money destination for business and leisure travel.

"At the end of the day, we all want to live in a safe and secure society and in this respect IATA stands shoulder-to-shoulder with South Africa in combatting child trafficking and other illegally exploitative practices. At the same time, it is imperative, given South Africa’s current socio-economic challenges, that airlines are permitted to safely, securely and efficiently transport people and goods between South Africa and its markets around the world," he said.

"This will promote economic growth, create and sustain jobs, drive skills development and advance genuine and meaningful transformation."

Protea Hotels also said it is thankful that the SA government has taken the concerns of the tourism and hospitality sector so seriously and has decided to look at alternative ways of achieving its goals while, at the same time, not harming the sector.

"We expect to experience greater numbers of bookings from visitors from countries that were hit the hardest, such as China and India. Because the previous regulations required applicants for visas to appear in person, in these geographically vast countries, for many prospective visitors it was extremely difficult to obtain a visa – if the individual did not live close to the place where he/she had to appear in person," said Danny Bryer, director of sales, marketing and revenue management for Protea Hotels.

"Since this requirement has now been dropped, we anticipate that we will see an increase in visitor numbers from these locations."

However, it will take a good few months before this is likely to happen, he cautioned. Government has indicated that the revised requirements will be implemented over the next few months. In addition, the communication and training that will be needed for both embassy officials and for travel agents and others involved in the marketing of our country abroad will also take some time.

"One concern we have is that there may well be other destinations internationally that filled the gap during the period that South Africa lost its attraction as a destination of choice. Recovering from this will require a substantial effort on behalf of our marketing staff and agents around the world," said Bryer.

"Protea Hotels also markets extensively to the South African domestic tourist base to encourage locals to be tourists in their own country."