Issue #42 - Asia Pacific Travel & Tourism Report, May 2021
The top 15 travel talking points in May from China to Guam, Japan to Malaysia and South Korea to Vietnam.
Hello. Welcome to May’s Asia Pacific Travel & Tourism Report… which sees the return of Dr Jaeyeon Choe and Michelle Dy!
Featured destinations include Brunei, Cambodia, China, Guam, Indonesia, Japan, Malaysia, South Korea and Vietnam.
Hot topics range from vaccine, sports and rural tourism to IP rights in tourism, the “legal fiction” of overseas travel and a new airline targeting Millennials.
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Thanks for being on board,
15 Travel Developments That Defined May 2021
1) Asia Stays Closed, Europe & US Reopen
This time last year, many experts predicted that Asia Pacific destinations would reopen first, as several countries in the region - think Taiwan, Vietnam, New Zealand - were containing COVID-19 relatively well.
Because of faster vaccine roll-outs and optimism about vaccine passports and mutual recognition of tests, many European nations are reopening this summer. The US, too.
Asia’s tourism rebirth remain delayed due to new surges and other factors (see #2 below). The exceptions, for now, are Bali and Phuket, which plan to reopen in July.
However, there are concerns that European countries are reopening without clear pandemic controls, and with issues around vaccine passport implementation.
What are the health implications of vaccinated tourists travelling to European destinations, where local hosts may not be fully vaccinated?
Moreover, several European countries are also still in partial lockdown.
At this point, there doesn’t seem to be a destination that has successfully reopened without an accompanying rise in infections.
We hope to find one soon...
2) Cocktail of Complacency & Vaccine Inequity
Just a few weeks ago, Thailand, Singapore, Taiwan and Vietnam were universally lauded for keeping COVID-19 under control. Today, those 4 countries paint a very different picture. Social gatherings are restricted, borders shut and people once again being told to stay at home.
What went wrong?
A confluence of factors led to this current surge of infections.
These include the entry of more contagious and dangerous strains, like the B1617 variant, slow vaccination rollouts and widespread complacency that the virus was under control.
A palpable sense that the zeitgeist was shifting permeated South East Asia at the turn of the year. That hope has taken on a much more sombre, if not helpless, tone.
However, the region should not shoulder all the blame.
Part of the reason for such a slow vaccination roll-out is because high-income countries claimed a huge bulk of the supplies - leaving slim pickings (and COVAX donations) for most Asian populations. As the WHO pointed out in May:
“Vaccine equity is not just a moral imperative, it is a strategic and economic imperative.”
3) “Book Me a Jab Tour”
As the US and Europe start to reopen, countries in the East are still struggling.
Vaccine FOMO (“Fear of Missing Out”) is becoming a thing. With an increasing number of people getting frustrated at the slow pace of vaccination in their countries, destinations and travel agents are taking notice.
In the April issue, we reported on Maldives’ plan to introduce 3V - Visit, Vaccinate, and Vacation. Now, we are seeing other destinations take a page out of its playbook with their own “vaccination tour” programmes.
Take Guam’s “Air V and V” campaign, which enables US expatriates living in Asia to get vaccinated on the island and enjoy a vacation. Vaccines offered are Pfizer, Moderna and Johnson & Johnson.
Travel agents in Thailand, Vietnam, and South Korea are getting in on the action by offering “vaccination tour” packages. Affluent travellers can fly to the US or Dubai, get jabbed and take a holiday. Thailand may even develop its own version later in the year.
4) Tourism “Facing Collapse” in Malaysia
Malaysia’s travel industry continues to endure painful times. With borders closed since 18 March 2020, domestic tourism has been off-limits since 15 January 2021.
On 8 May, Malaysia entered its 3rd Movement Control Order (MCO). This is a partial form of lockdown with inter-state and inter-district travel prohibited, schools and public venues closed and restaurants only open for takeout/home delivery.
Malaysia’s former Deputy Tourism Minister said the travel sector is “facing collapse,” The hotel industry is petitioning for emergency tax and utility payment concessions, and Yap Lip Seng, CEO of the Malaysian Association of Hotels, said:
“As long as travel restrictions are in place and both domestic and international borders are closed, the tourism and hotel industry will not survive.”
The current MCO has not “flattened the curve.” Quite the opposite. Malaysia began May with a 7-day moving average of 3,049 cases. This increased to 7,246 by 29 May.
As a result, the advent of June will see Malaysia commence a full national lockdown.
5) Cargo Lifeline for ASEAN Airlines
Cargo is a rare bright spot in a devastating year for South East Asia’s airline industry.
Increased cargo revenue is helping airlines stave off eye-watering losses. For example, Singapore Airlines’ SGD4.3 billion loss in 2020-2021 would have been probably worse, were it not for its strong cargo revenue of SGD2.71 billion.
While rising demand for air cargo is helping airlines’ bottom line, only a few passenger airlines in South East Asia - namely Cebu Pacific, Malaysia Airlines and Singapore Airlines - have dedicated freighters.
Airlines currently using passenger aircraft to transport cargo are at a disadvantage since they have limited capacity in the aircraft ‘bellies’ and cabins. Moreover, this type of operation is inefficient and will probably not sustain airlines in the long-term.
A resumption of international travel is vital to the survival of airlines in the region.
6) COVID-19 & Diplomatic Disputes
“There is no 'Singapore variant'.” That was the forceful reply by Singapore's Ministry of Health to comments by Delhi’s Chief Minister, Arvind Kejriwal, that a COVID-19 variant was circulating in the city state. His quote was as follows:
“The new form of Corona that came to Singapore is being said to be extremely dangerous for children, in India it may come as a third wave. My appeal to the central government are air services with Singapore to be cancelled with immediate effect.”
Pandemic-driven disagreements continue to spring up. As reported in Issue #22, 20 Events That Defined Travel & Tourism in Asia Pacific in 2020, a Thai newspaper caused a diplomatic kerfuffle by labelling the Philippines “Land of COVID”. The Philippines itself castigated Indonesia, claiming “They just don’t know exactly how many are sick are out there. At least we do.”
And this month, President Wavel Ramkalawan of Seychelles took aim at Maldives:
“Seychelles is under the microscope because it is a success vaccination story whereas the Maldives, where the occurrence of Covid has doubled in the last week from about 500 to 1200, isn’t.”
7) Should the Tokyo Olympics be Cancelled?
Will the upcoming Tokyo Olympics go ahead?
Yes, according to the International Olympic Committee (IOC).
This week, prominent Japanese newspaper The Asahi Shimbun called on the Prime Minister to cancel the Olympics, warning that public health may be compromised:
“It is simply beyond reason to hold the Tokyo Olympics and Paralympics this summer.”
Japan, which is being pushed hard by the IOC, is ploughing ahead - but it must get 36 million pensioners vaccinated before 23 July.
So far, only approximately 5% of the elderly have received a first dose.
8) Sports Tourism Still On a Time Out
In an “ordinary year” Asian football fans would be taking-off to attend the UEFA Euro 2020 tournament. Like the Olympics, the Euros were delayed by a year, and commence on 12 June.
Pre-pandemic, football tourism was booming, with Asian fans travelling to top league matches in England, Italy, Spain and Germany. Quadrennial tournaments, like the Euros and the World Cup, heavily promote ticket sales across Asia.
The upcoming Euros would have been a strong generator of travel, with matches to be played in tourism-friendly cities, such as London, Rome, Copenhagen and Amsterdam.
The value of sports events for generating tourism spend surged in the 2010s. This came to a halt in 2020, and remains impacted by travel restrictions.
Asian events are also affected. The Men’s T20 Cricket World Cup, scheduled for India in Oct-Nov, is in doubt, while the International Champions Cup football tournament, played each July-Aug in the US, Europe, China and Singapore was cancelled in 2020 and again in 2021.
About the Team
From South Korea, Dr Jaeyeon Choe is a researcher and consultant specialising in sustainable tourism development in South East Asia. She is a Visiting Professor at the School of Hospitality and Tourism at Hue University, Vietnam, and works as a sustainable tourism/business consultant at Insita Bali, Indonesia.
Based in Malaysia, Michelle Dy is a regulatory lawyer with extensive experience in policy research and public affairs across Asia-Pacific. She is also a published author of several academic journal papers and book chapters on cutting-edge issues in aviation.
Based in Malaysia, Gary Bowerman is Director of Check-in Asia, co-host of The South East Asia Travel Show and author of The New Chinese Traveler. Founder of Asia Travel Re:Set, he is an analyst, speaker and consultant on Asian travel economics and trends.
9) Sustainable Duty-Free Shopping?
Duty-free shopping is enjoying a boom in South Korea.
How so with borders closed, you may ask?
Remember those “flights to nowhere,” where passengers board a plane and disembark back at the same location?
To legally purchase duty-free goods in the airport, passengers must take a flight to nowhere beyond Korean airspace. A quick trip over a nearby Japanese island will do.
According to a recent report, the average spend of US$1,075 per passenger for one of these flights is “2.5 times higher compared to Korean passengers before COVID-19.”
However, are such flights (and the consequent emission of greenhouse gases) necessary to establish the “legal fiction” of travelling internationally?
Isn’t there a better way to offer duty-free shopping without harming the environment?
10) Staying Local Brings Hope in Vietnam
With overseas travel on an extended pause, domestic tourists have been spending locally - and at a higher level than in 2019. Vietnamese travel firms report that up to 60% of tours were booked for the 4-day Reunification Day (30 April) and International Labour Day (1 May ) national holiday.
A shift in spending behaviour has benefited high-end/luxury domestic tourism.
With staying local the only option, money once spent abroad shifted into the domestic economy. This could help shape how future tourism infrastructure is developed, and support the Vietnamese economy in the long-term.
11) Rural Tourism Thrives in China
If there is a silver lining from the pandemic, it’s that some domestic tourism destinations, such as small rural communities, are booming in Asia.
Chinese tourists, who were often considered to prefer city breaks or Hainan holidays, are exploring more rural locations. This developing trend is influencing Trip.com to create a "five year action plan” to promote rural tourism, by investing RMB1 billion.
Chinese tourists are choosing rural and remote destinations for peace, isolation and a healthy lifestyle - and to sample local foods. They also perceive rural areas to be relatively safe from COVID-19.
While rural tourism helps alleviate poverty in remote regions, it also can revitalise local heritage and cultures. There is immense potential for rural-inspired vacations in China. To sustain this trend in the post-pandemic period, local tourism authorities and businesses may focus on creative tourism products and services.
12) ‘Millennial Airways’ Coming to Indonesia
Yes, you read that right. Almost. In early May, Super Air Jet announced it will launch soon, and will especially cater to the needs of millennials. Whatever that means!
According to news reports, Rusdi Kirana - one of Lion Air’s co-founders - is a shareholder in the new airline. There has been much speculation about why Lion Air would want to start a new airline but we won’t discuss that here. Instead, let’s focus on Super Air’s business proposition: what makes an airline millennial-friendly?
Is it high-fashion uniforms for cabin crew? Insta-worthy cabin interiors or livery? Cabin crew with influencer status and appeal? Or simply cheap fares?
13) Would You Like to Choose Your Quarantine Hotel?
As full vaccine roll-outs will likely extend into next year in much of Asia, quarantine will remain as a central method of pandemic control.
Singapore and Vietnam have extended their quarantine to 21 days for visitors from certain countries. Thailand started the ASQ (Alternative State Quarantine) programme allowing tourists to choose a quarantine hotel at a suitable comfort/price level. Some book through Agoda.
Quarantine hotels in Hong Kong are differentiating themselves. For example, the Ovolo Hotel offers a quarantine concierge service, where guests receive a bottle of Cava at the end of their quarantine. South Korean tourists on social media have shared their experiences (and great Korean food) at some quarantine hotels in Vietnam.
Two years ago, no-one expected to choose a destination based on the “quarantine experience.” However, the quality/price of quarantine stays may impact location choices for some time.
14) ‘Green List’ Status For Brunei
Tucked away on the giant island of Borneo (which it shares with Malaysia and Indonesia), the sultanate of Brunei rarely troubles the travel media. South East Asia’s smallest nation attracted just 278,000 air arrivals in 2018. Growing visitor numbers from China (21% of visitors in 2019) saw Brunei target 450,000 arrivals in 2020.
Of course, that didn’t happen.
However, Brunei remains a singular COVID-safe pocket of South East Asia - with just 241 total cases - only 10 which are active.
This month, Brunei was included on the UK’s inaugural ‘Green Travel List.’ The 12 destinations deemed COVID-safe for UK travellers also include Australia, New Zealand and Singapore in Asia Pacific.
At present, UK citizens are not permitted to enter any of those 4 countries for travel.
15) Intellectual Property & Tourism in Cambodia & Sri Lanka
Debates about intellectual property (IP) rights in Asia tend to focus on consumer brands, car manufacturing and industrial equipment. Rarely tourism.
This month, the World Tourism Organization partnered with the World Intellectual Property Organization to reframe the discussion. A jointly produced report, Boosting Tourism Development Through Intellectual Property, argues:
“In spite of its key role in tourism, the IP system remains largely unexplored, and could be further developed.”
Looking ahead to a hoped-for global rebound, the report analyses the importance of protecting IP rights “in the areas of innovative solutions applied to tourism, destination branding and product development.”
Among the case studies cited are a “geographical indication” project in Kampot, Cambodia, and adapting a tea brand trademark for tourism experiences in Sri Lanka.
Well worth a read.
And, that’s a wrap.
The Asia Pacific Travel & Tourism Report will return on 27 June.
Have a great week,