Improving tourism can be the third pillar of the economy

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BASED on statements by the President-elect during the campaign, the Tourism Secretary could be part of the new government’s economic team. Ferdinand “Bongbong” Marcos Jr. had said tourism could accelerate economic recovery by creating jobs. He made a good point, and many also see tourism as a proverbial low-hanging fruit that could help the Philippines bounce back.

In 2019, tourism’s share of the total economy or gross domestic product (GDP) was 12.8%, according to the Philippine Statistics Authority (PSA). This was as important to the economy as remittances from Filipino workers overseas or OFW, and as important as the business process outsourcing sector.

Also in 2019, the share of tourism in total employment was 13.6%, again based on PSA data. Of course, the sector’s share of GDP and employment has fallen due to Covid-19. But those numbers suggest that simply returning to pre-pandemic levels will be a substantial economic boost. But why stop there?

If managed better, tourism can have an even greater impact on growth and development. Consider the potential. In 2019, tourist arrivals to the Philippines reached 8.26 million, an improvement from previous years. But compared to Vietnam, this figure was only half of its tourist arrivals for the same year. In fact, four other countries in the Association of Southeast Asian Nations (ASEAN) surpass the Philippines in terms of tourist arrivals. Thailand, which has a similar economic profile to the Philippines, ranks first in this indicator, with nearly 40 million arrivals in 2019.

With the right policies and programs, the Philippines could rival Thailand and other ASEAN countries. Moreover, tourism development can do wonders for rural development, as many tourist destinations are located outside of Metro Manila and other urban centers.

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Admittedly, realizing potential is never easy for Filipinos.

Good choice

Fortunately, Mr. Marcos has chosen a promising candidate to fill the tourism portfolio, Christina Garcia Frasco. She is mayor of Liloan, a municipality in the province of Cebu where her mother is governor. The mayor is also, for now, the spokesperson for Vice President-elect Sara “Inday” Duterte-Carpio.

Ms. Frasco appears to be a competent local CEO. As mayor, she has received various accolades including The Manila Times award for the most livable cities in the Philippines which was given to Liloan in 2019. Also, her heart seems to be in public service. She gave up law, representing foreign companies in multibillion-dollar arbitration cases, to serve in a small municipality. She was just elected for a third term as mayor when she was appointed head of the tourism department.

As mentioned earlier, Ms. Frasco faces difficult challenges because her office may have to rely on other departments that have their own priorities. For example, the country needs better airports, not to mention more international gateways closer to major tourist destinations. But the Ministry of Transport, not tourism, is responsible for it.

Tourism development also benefits from better inland connectivity, including convenient access to tourist sites. But the Department of Public Works and Highways is building roads and other similar infrastructure that will help the tourism sector achieve its goals.

Finally, the Philippines should consider liberalizing visa requirements or even removing them selectively, as Thailand and other countries in the region have done. But for that, Ms. Frasco will have to convince the Ministry of Foreign Affairs. She will also make points in negotiating air deals that would allow more foreign airlines to fly here, and her team will have to convince them that it would be economically viable.

Tourism promotion is the responsibility of the Secretariat for Tourism. But the impact of the promotions will be lower if tourists find it more convenient to travel elsewhere in the region and difficult to travel within the Philippines.

Of course, the pandemic also affects maximizing returns. But the Philippines simply needs to live with Covid-19, and for most that seems to be the general mindset.

Fortunately for Ms. Frasco, she represents a formidable political base and has a good relationship with the vice-president-elect. This could expand its role in policy-making.

For good measure, the public should support her. Its success will benefit the country.

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