A NEW Yorker unwittingly changed the course of Philippine tourism one day in December. As the sole of Gabby Grantham’s shoes kissed the tarmac on December 21 last year, the Filipino-American unwittingly became the Philippines’s 5 millionth visitor. Grantham symbolized the country’s climb from the mire of decades-long single-digit growth figure in tourism.
Eleven days and a new year later, the total number of arrivals to the country hit 5,360,682.
The economic impact of that 2015 figure was worth P227.62 billion in earnings, or an increase of 5.94 percent from 2014. Significantly, it was the brightest year in Philippine tourism’s history. Kudos were given to Tourism Secretary Ramon Jimenez and his team.
But while it looked good on paper, the figure on the country’s arrivals was still not enough to put the Philippines on Asia’s Top 10 most visited countries list. In its latest report, the United Nations World Tourism Organization ranked China as No. 1 followed by Hong Kong, Malaysia, Thailand, Singapore, Macau, South Korea, Japan, Taiwan and Indonesia, in that order.
As for Southeast Asia’s six major economies, Malaysia is topnotcher, with 27.4 million visitors annually. Thailand is second, with 24.8 million; Singapore third, with 15 million; Indonesia fourth, with 9 million; and Vietnam fifth, with 7.9 million visitors. The Philippines is sixth, with 5.3 million visitors, while the second-tier countries Cambodia, Laos and Myanmar are close by with 4.4 million, 4 million and 3 million, respectively.
France, the United States, Spain, China and Italy are the Top 5 countries with the most number of tourists annually. Interestingly, despite the recent terror bombings in Paris, France maintained its top spot in the rankings.
The turtle-slow pace of the Philippines’s tourism growth over the last 20 years is mind-boggling, considering the country has much to offer than most Asian countries. The conundrum comes as one of the archipelago’s 7,500 (as of the latest count) islands was voted by travel bible Condé Nast as the “World’s Best Island” twice in a row.
The big gap between Malaysia and the Philippines is staggering. Tourism sector stakeholders are hopeful this will change in due time. With more vigorous push from various sectors of the hospitality industry, the country’s tourism industry just might leapfrog to new heights in the next few years.
The impetus for growth, according to Samuel Lim of the Philippine Chamber of Commerce and Industry (PCCI), would come from the Southern Philippines.
Go South
MINDANAO will finally open up the Middle East market because of the similarity of food (halal), social norms and cultural practices, according to Lim, Philippine Chamber of Commerce and Industries vice president for Tourism. He told the BusinessMirror that Mindanao “would be a good alternative for the more than 20 million tourists going to Malaysia.”
Lim cited the many attractions the island-group offers, including the unique, pink beach in Zamboanga and Britania in Surigao del Sur. The latter is a group of 10 island resorts connected by fine, white-sand bars, “affording the tourist the opportunity to literally ‘walk on the water’ and go from one island to the next.”
“The Bukidnon mountain ranges are beautiful, and that is where the Benedictine monks grow some of the finest coffee beans,” Lim said.
Davao, specifically, would pace the country’s tourism growth, he added.
“Coming back from Davao and talking to the tourism industry people there, I believe Philippine tourism will boom because we will now have an additional international gateway, Davao, which is nearest to our Asean [Association of Southeast Asian Nations] neighbors.”
Lim added that because of Davao, the Bimp-Eaga (Brunei Darussalam-Indonesia-Malaysia-Philippines East Asean Growth Area) “will finally become a reality.”
The lure of Davao, Lim said, comes from its offers of islands adventure and the highland attractions, among which are sightings of the Philippine Eagle, Buda mountain resorts—“better version of Baguio”—and Mount Apo. He said Davao also offers “the widest variety of fruits and seafood!”
Lim said with the Manila, Cebu and Davao gateways, the whole archipelago “is now open for business.”
This he also credits to the eighth ‘A’ (“Assurance of safety”) “now in place as promised by the president-elect [Rodrigo Duterte].”
“We are on our way to becoming the most exciting new destination.”
Growth pains
HOWEVER, Lim said things are not yet falling in place.
“The Davao hotel business is bursting at its seams,” he told the BusinessMirror.
According to him, the front-office people are harassed by the sudden influx of tourists, telephone operators are not answering incoming phone calls promptly and the efficiency of housekeeping has fallen behind the demand.
“When I checked in my room in one of the top hotels in Davao, a shirt of the previous visitor was still hanging in the closet and there was no soap for the shower.”
He added hotel staff also “did not make up the room [which I found out when] I left at noon and came back at 9 p.m.
The hotels were short of food because of the great number of guests.
Lim said the “Ok lang, puede na” service “will discourage tourists from coming back and may be bad publicity for the place.”
But, overall, Lim said the main culprit in the slow pace of tourism growth is infrastructure.
“The next two administrations should focus on serious answers to enable the Philippines to accommodate 20 million tourists in the next decade.”
Lim is also urging Philippine officials to talk long term and build an airport with the capacity to handle that number of tourists.
“It can be done,” he said. “It is all a mindset.”
Infra ills
CONSTRUCTED in 1978, the Ninoy Aquino International Airport (Naia) was originally designed to handle 4.5 million passengers only per year. It already reached its maximum capacity 20 years ago.
Observers say cosmetic and short-term solutions would not do if the country wants to be more competitive—at least on the regional level where eight of the world’s 10 best airports are located. Presently, the airport cannot handle more than 5 million passengers a year, because its existing facilities are already operating at maximum capacity.
Two years ago, San Miguel Corp. offered to build an entirely new and modern international airport terminal that will pole vault the Philippines to the future and stand shoulder-to-shoulder with the rest of the world. The plan included building four runways capable of handling 150 million passengers annually and can efficiently handle 250 takeoffs and landings per hour.
The Naia’s two existing runways can handle only 42 takeoffs and landings per hour, and both are being used by domestic and international airlines. To note, airport-handling capacity is different from tourist-arrival figures.
Worsening congestion in the Naia is making SMC revive its world-class airport proposal for the incoming Duterte administration.
SMC President Ramon Ang said that when finished, the cost of the airport would be much less than the estimated $10 billion. Ang hinted of a possible alliance with the Philippines’s biggest conglomerates that would include those of Manny Pangilinan, Henry Sy and Jaime Zobel de Ayala. The proposed airport will be located in a 1,600-hectare reclaimed area in Manila Bay.
PPP’s 2-cents
ACCORDING to Public-Private Partnership (PPP) Center Executive Director Andre C. Palacios, development of infrastructure in the Philippines is crucial if it would like to attract more tourists to the country.
One of the key thrusts of the government for economic expansion—the infrastructure program of the Aquino administration—is mostly made up of transport deals, such as the development and construction of airports, seaports, highways and rail systems.
These, according to Palacios, are critical as they provide better connectivity and ease of travel for tourists and common people alike.
“Tourism will be one of the key drivers of Philippine economic growth in the next decade. We urgently need more public infrastructure to make this happen,” he said. “More roads and mass transportation, more efficient airports and seaports [are needed] for better mobility and connectivity.”
He cited, for example, the multibillion-peso modernization of the Mactan-Cebu International Airport that is currently being undertaken by Megawide Construction Corp.
“A lot of transport PPPs are linked to tourism. We need them for mobility,” Palacios said. “Look at the Mactan-Cebu airport project, it is actually boosting tourism in Cebu and Visayas.”
Since the listed company took over the operations and maintenance of the airport down south, several airlines, both local and foreign, have decided to add and launch new flights in and out of the air hub.
Power allure
THE Department of Energy (DOE), meanwhile, welcomed developments in the tourism sector, saying this would lead to a stronger uptake in power demand.
“Increased tourism activity in [any] area normally results in increased energy demand,” said DOE Assistant Secretary Patrick Aquino.
Earlier this year, the Research and Statistics Division of DOT reported that tourist arrivals for February 2016 reached 549,725 compared to 456,524 arrivals in February of 2015, a double-digit growth of 20.42 percent.
In just two months, the Philippines hit a record-breaking 1,091,983 tourist-arrival figure, a strong performance due to aggressive marketing blitz spiced up with international events that were held in the country in the preceding months. These triggered awareness increase and visitor influx.
About 544,948 visitors entered the country through various airports, and the Naia, the country’s primary gateway, welcomed 66.37 percent of the total visitor volume. The top-spending market again was Korea, followed by the US, China, Japan and Australia.
Aquino said industry stakeholders, including power producers and power distribution utilities, are always on the lookout for opportunities to boost business, while providing consumers with reliable and efficient power supply.
He, however, declined to comment on the power outage in the Naia last month that added another blot on the image of the country’s airport.
The Miaa suffered one of the biggest blackouts—6 hours long–before partial power was restored last month. Only then were the batteries, found to be defective in October last year, were bought.
One Naia ranking official who requested not to be named said privatizing the Naia would speed up procurement.
Nonetheless, the lure of the Philippines as a destination failed to dim another sector riding on tourism: hotels.
Hotel openings
TWO major hotel brands spread their wings and set foot on Bonifacio Global City over the last two years. Grand Hyatt and Shangri-La added branding muscle to their already strong presence by showcasing their trademark hospitality.
Earlier, Hyatt’s City of Dreams, Nobu Hotel, Marriott Newport City, Novotel and Mercure Ortigas ignited the opening surge. Hotel rooms in Metro Manila will reach a 26-year high and growth for the country’s hotel industry is expected to rise in the next five years.
With that, hopes are high that the Philippines can easily surpass its 6-million target by the end of this year. But the big question is, can it achieve its 10-million tourist arrival goal within the next two years? It is mathematically possible if the country’s airport-handling capacity can do it.
According to real-estate consultancy firm Pinnacle: “Even with a slight dip, we are doing much better than most countries in Southeast Asia, where occupancy drops ranged from 2.1 percentage points to as high as 8.6. Only Thailand and Vietnam bucked the trend with a slight increase in occupancy,” Pinnacle said.
Another leading real-estate company, Colliers foresees that “established branded hotel chains will come in to take over old, locally managed resorts that are in excellent locations but are past their prime. Boutique and lifestyle hotels in tourism areas will be the trend in hotel development over the years to come,” it said.
The Philippines is one of Asia’s most active countries in the hotel opening scene. It is set to dazzle anew with the launching of Conrad Manila, the global luxury brand of Hilton Worldwide, in June this year.
The luxurious 347-room hotel aims to inspire seasoned travelers and the local market by redefining the status quo and upgrade their impeccable taste to a new dimension.
With Conrad Manila’s entry, rooms are expected to exceed the country’s current 30,500 total in the next two years. Approximately, 3,300 new hotel rooms were completed in Metro Manila from 2014 to 2016.
A physically handsome hotel, Conrad Manila will offer best-in-class service and amenities. To date, it has already exemplified excellence prior to the grand opening, winning the Philippines Property Award as Best Hotel Development, Best Hotel in Architectural Design and Best Hotel Interior Design.
Iconic design
PICTURE this: The whole shape of Conrad Manila is iconic, derived from a ship that has permanently docked in Manila Bay waters. Inside is a unique blend of modern art and Filipino artistry, inspired by air and sea wave elements across the bay.
In one of its breathtaking lounges, the design allows one to experience an infinite ringside view of Manila’s jaw-dropping sunset, better than what one would have probably previously experienced.
On a Friday and Saturday, a stay at the hotel becomes a multiple treat. As soon as dusk settles, fireworks joyfully welcome a guest’s distinguished presence. Here, like everyone else, a visitor’s stay is celebrated for being an honored guest.
“The Conrad way is luxuriously excellent, physically and experientially. We aspire to inspire so that we exceed expectations. We anticipate and we have things ready for you even before you ask,” said Harald Feurstein, newly appointed general manager of Conrad Manila.
An Austrian with excellent credentials like the hotel, Feurstein has worked with the best hotels in Asia and was Conrad Manila’s first employee from ground zero till the beautiful structure surfaced behind the SMX Convention Center.
“I consider it a badge of honor being part of Conrad Manila’s history from Day One,” Feurstein takes pride in saying. He is upbeat about Manila’s tourism prospects and acknowledges that the Philippines has a bright future ahead, even brighter than the rest of the former Southeast Asian dragons which have lorded the scene in the last 15 years. “With consistent above-average 6-percent growth, the Philippines is poised to shine even more,” he said.
How will the hotel market its way in reaching its core market? Feurstein said, “Diversification will be the key.”
“Hotels are not just for tourism anymore. We do not want to rely on a single market alone. We would like to be known as the most innovative among luxury hotel brands in the Philippines. We want to promote domestic leisure, ‘staycation’ and show the unique Conrad way of excellence with our MICE [Meetings, Incentives, Conferences and Exhibitions/Events] capabilities,” he said.
Destination concept
“CONRAD Manila is for the new generation of smart luxury travelers for whom life, business and pleasure seamlessly intersect,” according to Feurstein. As a global luxury brand with 23 properties across five continents, Conrad connects guests to people and places around the corner or halfway around the world.
Feurstein will be responsible for the growth of the brand in the country. “It is a privilege for us to reintroduce Hilton Worldwide through the first Conrad hotel in the Philippines, especially in these exciting times, as the country is on the brink of rapid economic growth across all sectors,” said Feurstein, who reports to Peter Webster, Hilton Worldwide’s regional general manager for Singapore, Indonesia and Philippines.
“I am certain that the hotel will be a significant addition to Manila’s dynamic cityscape. With Harald’s 25-year industry expertise and deep knowledge in hotel operations, I am confident that Conrad Manila is primed for great success in this growing Philippines tourism market. It will be a landmark where one-of-a-kind, inspired experiences will be created for guests,” Webster said.
Born and educated in Austria, Feurstein already planned to work in a hotel when he was young. “It was my goal and I had no doubts about pursuing it as a career,” he said. After graduating from college, he worked as a nightclub waiter and bartender. He then worked his way up, moving to Switzerland, his first job outside of his home country.
He spent the rest of his professional life in Asia, and considered each country his home. “All of them has a place in my heart, every place is special,” he intimated.
Feurstein has been actively participating in the development oversight of Conrad Manila since last year. His involvement took him across all facets of hotel management, from planning a good strategy to positioning the hotel as a choice destination for luxury travelers with one aim—give the Philippines a strong competitive advantage in the international hospitality landscape.
Prior to his assignment in Manila, Feurstein was GM of Hilton Pattaya, Conrad Bangkok, Hilton Cebu Resort and Spa, Hilton Kuching and Hilton Batang, and director of business development for Hilton Beijing, Hilton Seoul, Hilton Kuching and Petaling Jaya.
He was former food and beverage manager of Hilton Petaling Jaya, Hilton Kuching, Hilton Batang and Norfolk Hotel, and F&B director of Hyatt Regency Kinabalu and Grand Hyatt Fukuoka. His hospitality career has taken him across the world to continents such as Europe, Africa and Asia. His past experiences in Asia have taken him to China, South Korea, Malaysia, Japan, Vietnam and now the Philippines.
A man who describes himself as very adaptable to different cultures, Feurstein loves to do a balancing act. “I love to make people do their best and I am always deeply supportive in developing their career,” Feurstein said.
The tall, bespectacled man loves to lead by example. “When people see it in their leader, they inevitably try to do it,” he said. He is very demanding at work because he said he has a purpose. “I’d like to be in a team surrounded by people with a sense of purpose, because I have a set of goals that I started and want to finish them. I’d like to steer a ship and allow people to do what they’re good at,” he added.
Outside of work, Feurstein is also a man of action with a lot of passion for extreme sports like participating in lung-busting ultramarathons. He has participated in many events of this kind in the Philippines. He has also endeared himself to the Philippines and its people and pays homage to the Filipino whom he said are naturally hospitable. “Hospitably is naturally ingrained in the Filipino. When you are naturally hospitable, half the battle is won,” he said.
Luxurious amenities
“WE don’t just check you in and check you out,” Feurstein said. “We give you the total package,” he punctuated.
Conrad Manila has a 24-hour fitness center, a sparkling outdoor infinity pool, tranquil Conrad Spa and an Executive Lounge for guests staying in an Executive Room or suite.
The hotel’s intelligent rooms are equipped with motion sensors that recognize a guest’s arrival, equipped with wired and Wi-Fi Internet access, Bluetooth-enabled entertainment technology, 42-inch flat-screen HDTV, espresso machines and hydrotherapy rain showers, with magic mirrors in the bathrooms available in all suites for an uninterrupted entertainment experience.
Suites and executive rooms offer picturesque bay or city views, plus access to the Executive Lounge. The luxurious Presidential Suite features a spacious outdoor terrace, a private pool and stunning Manila Bay views.
Brasserie on 3 is the all-day dining restaurant serving an extensive buffet selection at breakfast, and an à la carte menu for lunch and dinner. China Blue by Jereme Leung offers a modern Chinese dining experience, with an especially created menu that blends contemporary cooking techniques with local flair.
One can enjoy afternoon tea at C Lounge, which transforms from a laid-back lounge at daytime to a sophisticated destination bar after the sunset. A guest can sip cocktails while soaking up the sunshine in the Pool Bar.
For 96 years, Hilton Worldwide has been dedicated to continuing its tradition of providing exceptional guest experiences. The company’s portfolio of 12 world-class global brands is comprised of more than 4,500 managed, franchised, owned and leased hotels and timeshare properties.
It has more than 745,000 rooms in 97 countries and territories, including Hilton Hotels & Resorts, Waldorf Astoria Hotels & Resorts, Conrad Hotels & Resorts, Canopy by Hilton, Curio—A Collection by Hilton, DoubleTree by Hilton, Embassy Suites by Hilton, Hilton Garden Inn, Hampton by Hilton, Homewood Suites by Hilton, Home2 Suites by Hilton and Hilton Grand Vacations.
Medical tourism
AS part of the property developers’ effort to attract foot traffic in their facilities, firms decide to join the medical-tourism bandwagon as putting up clinics into their properties such as malls to building tertiary hospitals across its cities.
Ayala Land Inc., the country’s second-largest real-estate developer, has acquired a noncontrolling Batangas-based Whiteknight Holdings Inc., a company that partly owns Mercado General Hospital Inc.
MGHI owns the 100-bed tertiary hospital Daniel O. Mercado Medical Center based in Tanauan, Batangas, which provides service to residents in the Cavite-Laguna-Batangas-Quezon area.
The said company also owns and operates hospitals and ambulatory surgical centers in Batangas, Cebu and Manila.
The acquisition of Whiteknight will allow Ayala Land to build a strategic partnership with the Mercado Group, which will then operate the hospitals and clinics that will be located inside Ayala-owned properties.
The company earlier said it plans to build at least 20 clinics and hospitals in the next five to six years, as setting up such health facilities will complement the company’s mixed-use developments by generating more foot traffic to its malls.
Jaime Ysmael, the company’s chief finance officer, said the company initially plans to build 10 clinics and 10 hospitals in Ayala Land’s property developments in key cities across the country.
“We intend to continue expanding [the business] and we believe health care is a very good complement to the existing business we have, especially as we create new communities,” Ysmael said.
Ysmael, however, said the company will focus more on the clinics, which will be under Qualimed brand, as it attracts foot traffic to its malls. The company, however, will limit its building of large hospitals, but mostly on primary diagnostic with a few rooms.
Ayala Land already opened its hospital in Iloilo, and plans to put up a branch in its development in Nuvali in Laguna, Altaraza in Bulacan, North Point in Negros and in other parts of Metro Manila.
On the other hand, the hospital group of Metro Pacific Investment Corp. (MPIC) has been snapping up hospital assets across the country, some of which it has turned around the operations while expanding others.
MPIC now has 11 hospitals that it either owns or part owner, the last of which was the purchase of a 20-percent stake in the company that operates Manila Doctors Hospital and a 51-percent stake in Sacred Heart of Malolos in Bulacan.
In addition, the group also invested in a mall-based diagnostic and surgical center MegaClinic in SM Megamall, and has indirect ownership in two health-care colleges Davao Doctors College and Riverside College Inc. in Bacolod.
Businessman Manuel Villar is also joining the hospital venture but not mainly for tourists but to serve its communities.
Villar, chairman of publicly listed Vista Land & Lifescapes Inc., said he will go into operating its own chain of hospitals, starting out in Vista City in Daang Hari in Las Piñas called VitaMed.
“We are starting small. About 150 beds, but expandable to 300 beds. It actually has unlimited expansion possibilities, since we have a large property in Daang Hari,” he explained.
Villar said they have partnered with doctors for the hospital business and they will be providing the medical services.
More work
REAL-estate watchers say more brands are due to enter Manila until the end of 2017. To reach its goals, the Philippines must act on important issues in order to be a major player in the Asian travel industry.
One of them is the Naia, which has been constantly figuring in the world’s worst airport surveys.
Guillermo Luz, cochairman of the National Competitive Council of the Philippines, said, “Overall, the Naia delivers a less-than-satisfactory travel or customer experience for the passenger.”
This is only highlighted when compared to the facilities and services of other international airports located right in the region, such as in Singapore, Hong Kong, Bangkok and Kuala Lumpur, according to Luz.
“We need to create better first impression for visitors,” Luz said. “We need more passenger capacity within our overall airport system if we want to increase the number of international visitors and domestic tourists.”
He reiterated that the country’s main airport should play a role in “projecting our national brand.”
“The customer experience at the airport should be aligned with our international reputation for our warm hospitality,” he said. “It should also be a venue for projecting our culture visibly and through the service [that] passengers experience.”
Doing more
LIM added that if Davao becomes the international gateway for the whole of Mindanao, the arrival facilities, airport and seaports have to gear up for three to four times its capacity “now to accommodate passengers of international airlines, coming via Ro-Ro [roll on-roll off] and cruise ships.”
Davao has to extend its runway and possibly reactivate the old airport for domestic flights, Lim said. The access, interconnectivity to the other major cities by air, sea or land has to be given priority. The accommodations, especially outside of Davao and Cagayan de Oro, need to catch up with the demand for predictable and consistent quality hospitality standards. He added the government “has to look into the great many natural attractions that need investment for tourist-grade facilities.”
“Activities have to be coordinated and offered as one-day, two-day and three-day all-in vacation packages,” Lim said. “The natural hospitality of the people has to be molded into world-class and efficient skills, while the advertising may have to focus on Mindanao as the exciting and natural and mystical ‘lost/last’ frontier, now open for tourism.”
Major infrastructure, peace and order and foreign visitor-safety issues should be better addressed, Lim said.
Until these are not given priority and acted upon, observers say the country’s achievement will plateau and growth will be disappointingly low.
Source: Business Mirror | May 25, 2016
http://www.businessmirror.com.ph/southern-phl-to-fuel-tourism-growth-engine/
