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  • Action for Economic Reforms

BOOST RP’S TOURISM THROUGH INFRASTRUCTURE

Mr. Cole, a British national working in Manila, who occasionally writes for Action for Economic Reforms (ww.aer.ph). He has visited a lot of places in the Philippines that begin with a letter B. This piece was published in the in the April 6, 2009 edition of the BusinessWorld, pages S1/4 and S1/5.


Change is inevitable. Progress is not. That should be borne in mind by

those interested in the tourism sector (and all the planners in the

Philippines). I was originally intending to write this article about the lack of a

Department of Tourism (DOT) and Wow! Philippines campaign (at least in

the UK), but then I saw an ad on the BBC news website that changed my

opinion. Whoever green-lighted that deserves a pat on the back! Having

said that, I still don’t understand why a giraffe is used to advertise

“Wacko over Wildlife.” Why would I travel to the Philippines to see

endangered African animals? Surely I would travel to Africa; the

Philippines has enough endangered animals of its own – why diversify

when you can specialize?


The global tourism industry is worth some $3 billion a day. A day! That

has probably declined a little now that all hell is breaking loose in

the world’s economies, but that really is still a figure all but

impossible to grasp.


The entire region of South East Asia is the sixth most visited place by

tourists. If you count Europe as one block (it has no internal border

control and great transport infrastructure), SEA would move to third.

The Philippines’ share of this tourism is minimal; it is not even in

the Top 50 (2008) of most visited places in the world (Thailand is

18th). In 2007, it ranked 43rd in terms of revenue with just over $4.9

billion a year– which is not that much really – way less than 1% of

total of world tourism revenue, and just over 1% of national GDP

(compared to Thailand’s 6.7% of GDP- it also has double the per capita

income).


So why isn’t the Philippines attracting tourists? Filipino service is

excellent. Apart from Manila and the big cities most places seem fairly

idyllic. Festivals and Fiestas potentially offer great opportunity for

touristic growth. Imagine for a moment you have never seen a carabao,

you come to the Philippines, laze on a pristine beach and travel to

Bulacan to witness possibly the most bizarre thing ever: the semi-religious carabao festival would certainly be something to talk about when returning to rainy, dreary home; creating demand. Some places still have excellent biodiversity (usually places without mining) and that is a growth tourism sector. The beaches of Boracay are good, as are the ones a bit more off the beaten track like Palawan and Baler, which are superb.


Tourism in the Philippines faces many problems; armed insurgency is one

of the major ones that springs to mind! But that is a problem shared by

several neighbors, and recently there have been major bombings in

London and New York and Madrid. Is it not interesting though, that all

these attacks occurred on transport? Planes, trains, undergrounds and

buses: the method of travel for tourism and business! One day the

conflict will be resolved, but that takes time.


Something that can be done now – especially given the current economic

climate – is infrastructure investment so that when tourists arrive

they get around easily. It also undoubtedly helps though i.e. not

‘U-turn slots to heaven’ or bus stops literally in the middle of the

EDSA-Pasig Bridge domestic businesses in a myriad of ways.

Infrastructure developments should be useful (which, in case you were

wondering was a bus stop created, operated, and demolished by the MMDA

in the space of five working days. I hope the person behind it was

laughed out of their office).


But before the tourists can use the infrastructure they have to get here.

To get to the Philippines from pretty much anywhere outside of SEA is a

time consuming and in terms of business and tourism that is not good;

time is money after all! Of course, there are burgeoning markets in

Asia (India and China alone account for 1/3rd of the worlds population)

and they could and should be tapped. When my parents left Australia in

the early 80s they left a tin shack of airport in Cairns (my dad said

it was literally a tin shack) and flew to the then Marcos airport as

the hub for their return to the UK. The Manila airport then was modern

and an area hub apparently. Cairns’ airport is now far bigger and more

impressive than Manila’s NAIA (the small city has tapped majorly into

the lucrative British backpacker trade). Other places such as Thailand

and Hong Kong also invested heavily in infrastructure such as airports.


But NAIA, for example, is so outdated that not only is it not in the

same league as its neighbours, it is barely playing the same game.

Infrastructure is a day to day problem in the Philippines but unlike

peace treaties it is relatively easy to solve. It has the added

benefits (if you follow Keynes) of really helping the economy out

during downturns. The government has recognised this and is putting a

lot of money up towards infrastructure development, which is certainly

a good idea. But remember: Change is inevitable; progress is not. They must get the most bang for their buck, and make sure that any bridges they build actually go somewhere!

Whilst things like the Skyway in Manila is a sort of good idea-in the

short term- for cutting traffic it is an eyesore from ground level and

looks like something from ‘Escape from New York.’ Many different

traffic management policies – from toll gates on EDSA, to bicycle

lanes, to higher taxes! – could have been pursued which could make

things look better, run better, and have more net benefit for people

and environment (incidentally the coding system of traffic management

was disproved both in theory and in practice in 2001; it is more

polluting and more congesting) .


We are currently living in interesting times. During a world wide

slump, tourism as an industry is not going to be doing much as people

stay at home and save money. What the government should probably be

doing is borrowing heavily (interest rates in the UK and the US are 0

-0.5) and investing infrastructure, build a completely new airport and

a train line from it directly into the heart of manila, link up all the

MRTs ( and why aren’t these underground?) so that you don’t have to get

off and change, and so it is easy and safe to use. Darkness and

concrete do not encourage the feelings of safety for the tourist, or

the worker! Build spend build spend, create jobs and create growth. But

make sure what you are building looks good, and operates well! That is

a very simple and dictatorial take on a complicated and challenging

issue I admit. Why? Because when the tourists start flying again the Philippines should be in a position to compete with Thailand (who shot themselves in the national foot this year), Vietnam, India and Australia. And by creating useful infrastructure you strengthen the domestic economy (remember the Php100b locked in traffic?), and that attracts business,

meaning you get back a lot more than your initial infrastructure

investment aka the multiplier effect.

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