ASEAN market to get tenth of world’s tourism investment
One in ten of all tourism investment dollars will go into ASEAN countries over the next ten years, according to new research by the World Travel & Tourism Council (WTTC).
According to the ‘Travel & Tourism Investment in ASEAN’ research, during the years 2016-2026, 9.7% (nearly 1 in 10 dollars) of global investment in Travel & Tourism will be in ASEAN countries.
Travel & Tourism investment in ASEAN over the next decade is set to total US$782 billion, which is 7.4% of all investment in the region. This represents growth of 6.3% per year, nearly two percentage points faster than the global average.
Top five dominate
Investment spending will be dominated (95%) by five major destinations – Singapore, Thailand, Vietnam, Indonesia, and Malaysia – which together account for over 80% of ASEAN’s international arrivals and tourism contribution to GDP. However, given the strong demand for travel to this region, some countries are still at risk of not investing enough to ensure infrastructure meets the needs of forecast tourism growth.
The report highlights the investment needed in ASEAN in order to support the region’s forecast Travel & Tourism growth over the next decade. ASEAN is one of the world’s most tourism dependent regions –Travel & Tourism contributes 12.4% of GDP, nearly 4% above most other world regions. However, according to the report, ASEAN Travel & Tourism infrastructure currently only ranks ahead of Latin America, the Caribbean and Africa.
As such the outlook across the ten constituent countries of ASEAN is mixed:
- Myanmar, Cambodia and the Philippines are classified as infrastructure constrained. Forecast investment is not deemed to be sufficient to ensure that poor existing infrastructure can be improved to meet the needs of future Travel & Tourism demand and to maintain competitiveness.
- Vietnam and Laos are identified as having ‘improving infrastructure and growth prospects’ although future investment will need to be channelled effectively and targeted at priority areas.
- Thailand is the only country classified as ‘future focus critical’ where relatively strong existing T&T infrastructure and future demand growth need to be supported by a continued investment focus.
- Malaysia and Brunei Darussalam are expected to balance future infrastructure investment needs with forecast demand growth. Singapore and Indonesia are classified as ‘having high levels of infrastructure spending and forecast growth that should allow them to sustain projected levels of demand.
Infrastructure is key
David Scowsill, the WTTC’s president and CEO, said: “Our research shows that investment in infrastructure is critical to the future sustainability of Travel & Tourism. As one of the fastest growing tourism markets, public and private sector leaders across ASEAN must prioritise tourism investment and channel it effectively to ensure the region’s infrastructure can meet this increasing demand.
“Countries such as Singapore and Indonesia are leading the way in terms of their infrastructure development but across ASEAN there is much more which is required. For some countries this might mean expanding capacity, through increasing visitor accommodation, airport capacity and tourist facilities while others need to maintain and enhance their current infrastructure.”