Domestic spending to propel tourism sector gains by 2028


DOMESTIC travelers are expected to pack a wallop into the economy by contributing a projected P3.8 trillion in revenue by 2028, outpacing the P701-billion share of inbound tourists.

According to the just-approved National Tourism Development Plan (NTDP) 2023-2028, under the conservative baseline scenario, total receipts generated from domestic and inbound travelers at P4.5 trillion, will expand the share of the tourism sector to 14 percent of the economy, as expressed in GDP, by 2028. This slightly surpasses the pre-pandemic P3.8-trillion total receipts in 2019, which accounted for 12.9 percent of the GDP, or the total amount of goods and services produced by the local economy. Government economic managers have targeted a GDP growth between 6.5 percent and 8 percent from 2024 to 2028.

On Tuesday, President Ferdinand R. Marcos Jr. approved the third iteration of the NTDP, which serves as the administration’s blueprint to grow the economy by supporting policies, programs, and projects that enhance the tourism sector. Unlike the Plans of the previous administrations, however, the NTDP 2023-2028 has no indicative cost in its implementation, i.e., estimates how much government has to spend on improving infrastructure like roads, bridges, ports, and airports to help lift the tourism industry, well as private sector investments in building hotels and resorts, modernizing air fleet or seacraft, and the like.

6.3M tourism jobs

Under the new Plan, by the time Marcos Jr. steps down in 2028, there should have been 137.5 domestic trips taken, and 11.5 million international tourists who have visited the Philippines, up from the 85.1 million domestic trips and 4.8 million international visitors projected this year. (See, “235M traveled across globe in 1st quarter of 2023—UNWTO,” in the BusinessMirror, May 18, 2023.)

By 2028, jobs in the tourism sector should have grown to 6.3 million, equivalent to 12.9 percent of the country’s total employment, from the projected 5.3 million jobs, equivalent to 11.8 percent of total employment this year. While tourism jobs are projected to rise in 2028, they still fall short of the 13.6-percent share to total employment recorded in pre-pandemic 2019.

In a statement, Tourism Secretary Christina Garcia Frasco said tourism is one of the few industries that can create opportunities and livelihoods in many of the Philippines’s farthest, most remote communities, and across all sectors of society. Though the country has a very productive tourism industry, she also recognized that it has also been hounded by challenges.

DOT goals

“So, it is by unlocking all of these roadblocks that we would be able to fully develop the tourism industry guided by the National Tourism Development Plan,” she said.

To achieve the Plan’s targets, the DOT aims to improve tourism infrastructure and access to destinations; improve connectivity in destinations and digitalize travel procedures; equalize the development and promotion of tourism products; diversify the tourism portfolio; maximize domestic and international tourism; strengthen its ties with local and national local stakeholders, thus enhancing the overall experience of every tourist in the country.

Despite having attained an historic-high of 8.3 million international travelers in pre-pandemic 2019, data show the Philippines still lagging behind its neighbors. That year, Thailand attracted 40 million foreign tourists, followed by Malaysia at 26 million, Singapore at 19 million, Vietnam at 18 million, and Indonesia at 16 million.

But the pandemic, which led to the closure of many borders, has forced the DOT to look inward and implement better policy to encourage domestic tourism. At the height of the pandemic in 2021, the NTDP cited international visitor spending at P41.5 billion, which was just 6.8 percent of the P612 billion recorded in 2019.  On the other hand, domestic travel spending surged to P1.62 trillion in 2021, or close to 50 percent of the P3.3 trillion spent in 2019.

Image credits: Joel Paredes