Low budget tourism is the way to go

Low-budget air fares and low-budget hotels are the drivers of the impressive growth in the number of tourist arrivals in the Philippines.Bertie Lim, secretary of tourism, told Malaya Business Insight in an interview that there is an increasing number of low-budget hotels that he said, in turn, complement low-budget airlines.

Two of the more popular low-budget hotels Lim mentioned are the Go Hotels of John Gokongwei Jr. and Tune of Air Asia, the largest budget airline in the Asean region.He also said that Ramon "Boy Blue" del Rosario owns the Microtel, a chain of low – but not the lowest – budget hotel which has a presence in many tourist destinations such as Baguio City.

Low-budget hotels can go as cheap as P600 per room night. The room is about 10 square meters, with no air condition, no towels, and no bath soaps. If a guest wants them, he pays a price nearly at par with that offered by supermarkets or groceries.

According to Lim, Ryan Air of Ireland, the world’s biggest airline, charges fares as low as $50 per passenger, depending on the distance but it can charge the same amount within the Asean region.Low-budget hotels and low-budget airlines are the way to go in attracting tourists to the Philippines.Lim pointed out that at present, the biggest number of tourists is from the Asean region.He said that for the first two months of the current year, 668,625 visitors came to the Philippines.

He explained that the Department of Tourism does not consider vacationing overseas Filipino workers as tourists. However, he said, Filipinos who have acquired foreign citizenship are considered tourists.Lim said tourists have an average stay of nine days in one visit and spends an average of $100 a day. That, he said, explains the whole advantage of low-budget hotels and low-budget airlines.

The biggest source of tourists who visited the Philippines during the first two months of the year was South Korea, which sent 165,868 warm bodies to the country. Next was the United States, which recorded 114,022 tourists.Lim explained many of the American tourists are Filipinos who have acquired US citizenship.

Lim emphasized that while the main drivers of tourist arrival growth are low-budget airlines and low-budget hotels, the country is preparing for visits of tourists from North America and Europe.According to Lim, the group of George S.K. Ty of Metrobank is coming up with a Grand Hyatt Hotel with 400 to 500 rooms. The Ayala Group, on the other hand, has started with four so-called "boutique" hotels.

They are smaller hotels with no frills but are just as comfortable to spend the night in or for a long day of rest.Lucio Tan’s Eton Properties is also coming up with a five-star hotel although he already owns and operates the three-star Century Park Hotel, which is the favorite of Chinese and Korean visitors.

Another five-star hotel called Crimson will rise in Andrew Gotianun’s property empire in Alabang. The group will build another in Mactan.SM’s presence will be felt in Davao City and Puerto Princesa. SM is the company that started the Henry Sy empire that has expanded into many ventures, principally banking and giant malls.

The family is now very heavy in property development.At present, there are at least 15,000 hotel rooms in the three- to five-star categories in the Philippines.Lim pointed out that low-budget hotels preferred by tourists charge only around $20 a room night. That is less than P1,000 but no frills.

According to Lim, there is a heavy turnout of domestic tourists encouraged by low-fare airlines and budget hotels. He said there are eight times more domestic tourists than foreigners.He explained that their expanding number helps boost the economy because they always go back home with a few things bought from some stores in Metro Manila or elsewhere.

Lim confirmed the observation of Andrew Tan of the Resort Casino hotel group that the biggest potential tourists are the Chinese from the Mainland. He said at present close to 60 million Chinese go abroad but about 80 percent of them do not go beyond Macau and Hong Kong.

There could be 100 million Chinese tourists by 2020. He said the Philippines is preparing for them.The casinos will help attract them to visit the Philippines, Lim said.According to Lim, there are internal problems that the country must solve to attract the big-spending tourists. He said European and American airlines are scared to come to Manila for safety reasons.

He said the Ninoy Aquino International Airport is still in Category II. European and American airlines want to fly to countries in Category I, which translates into safety at the airport.A businessman who came from Europe told Malaya Business Insight that insurance firms do not sell accident cover for travelers coming to the Philippines.The reason is perception of a lack of safety.

Source = malaya.com.ph