Issue #69 - Loosening State Control Over Travel is South East Asia's Biggest Challenge
Travel and tourism are exposed more than ever to political power plays.
Welcome to issue 69 of Asia Travel Re:Set…
"The ASEAN Tourism Forum provides a platform to encourage collaboration between ASEAN member states and to holistically promote the region as one destination."
Today, sees the start of the 2022 ASEAN Tourism Forum (ATF) in Sihanoukville, Cambodia.
Established in 1981, the ATF is both a travel trade forum for the Association of South East Asian Nations (ASEAN), and a political summit.
As the official website affirms:
“[It] aims to connect key stakeholders in the travel industry, which includes tourism ministers and officials.”
Lim Jock Hoi, Secretary-General of ASEAN, will attend the Tourism Minister’s meeting at ATF - highlighting its elevated status.
After 2 years of COVID-19, travel has become more political than ever - especially in South East Asia, where it was already heavily state-driven. Tough border regulations, flight bans, quarantines, visa approvals and vaccine mandates have tightened state control over the ability to travel - and the policy direction the industry might take.
And we have reached an inflection point. Economic growth in 2022 will require ASEAN economies to be more open and accessible than in 2020 and 2021.
So, we will hear Tourism Ministers talk about “rebuilding travel,” “working together” and “sharing the benefits.” They will extol (yet again) the benefits of an “ASEAN Travel Corridor.”
Whether these words deliver integrative actions remains uncertain.
One outcome of the pandemic has been intensified competition between nations to recover (or, at least, appear to be doing so) faster than their neighbours.
Decoupling border controls from revenue raising and overall tourism management will be a tricky challenge.
Thanks for being on board,
Gary
The Sunday Itinerary
- This Week’s Top 5
Updates from Thailand, Malaysia, Indonesia, Cambodia, the Philippines
- Loosening State Control Over Travel is South East Asia’s Biggest Challenge
Travel and tourism are exposed more than ever to political power plays
This Week’s Top 5
Updates from Thailand, Malaysia, Indonesia, Cambodia, the Philippines
The implementation of Thailand's long-trailed THB300 Tourism Fee in April "will affect an already comatose tourism industry."
New entry rules are introduced in Malaysia for fully vaccinated travellers who have recently contracted COVID-19.
Indonesia's state-owned tourism and aviation holding company InJourney "will develop domestic tourism [as] international travel is still restricted."
Cambodia's Ministry of Tourism sets out a lengthy and detailed list of 'Do and Don't” regulations for visiting the country.
The 'Novak Rule'?: The Philippines imposes "yet another requirement on the few foreigners allowed to enter: they must be fully-vaccinated."
“IN THE NEWS”
Really enjoyed collaborating once again with Víctor Cortizo, Diana Ramiro and the Centro de Estudios de Turismo Chino (CESTUR China) team in Madrid - almost 3 years after our last seminar together in the beautiful Spanish capital.
Look forward to joining a diverse panel to discuss the way forward for business travel in Malaysia at the 2nd edition of X-Change Malaysia on 26 January.
Loosening State Control Over Travel is South East Asia’s Biggest Challenge
Travel and tourism are exposed more than ever to political power plays
“Navigating the way back to sustained tourism demand is fraught with operational, logistical and social challenges. But as tourism professionals spend their lockdown days engineering recovery campaigns, the words of political leaders will echo in their ears.”
I wrote those words in an April 2020 article, Travel is About to Get Very Political.
And so it has proved.
Before the pandemic, travel and tourism occasionally made headlines - but the state-administered contraction of travel has made them exceptionally newsworthy topics.
Similarly, the office of the Prime Minister rarely troubled itself with travel issues. Now, updated travel policies are often issued on headed paper from the PM’s office.
The travel industry’s near-term direction resides in the hands of governments - all the way up to Prime Ministerial level. Loosening those ties, will not be easy.
Shutting borders was always going to be easier than opening them again because more political interests have become involved. The concept of travel in a pandemic era cuts across several cabinet offices, all of which are staking their positions.
Two years of shifting pandemic waves and border restrictions have created inward-looking political cultures. Even where the will exists to revive international travel, the mechanisms have been blunted.
Here are 5 issues to consider.
1) Central Target Setting
During the region’s 2010s travel boom, governments - and their tourism boards - published ambitious annual visitor targets. These promoted mass tourism and encouraged frequent and heavy discounting. They are not something you tend to see in mature tourism markets, like Europe or North America.
It was hoped that the dislocations of travel supply and demand caused by COVID-19 would dim the appeal of visitor targets.
Not so.
Thailand - which spent much of 2021 revising down its targets - covets 10-18 million inbound visitors in 2022. Vietnam 5 million, Indonesia 3.6 million and Laos 1 million.
However, these neatly rounded goals - while necessarily much lower than the ones set pre-pandemic - conflict with other aspects of the travel political economy…
2) Setting the Rules of Supply
South East Asia’s vibrant ‘book-and-fly’ culture has been replaced - for now - by central planning. Not only are the available destinations controlled, so are the booking channels.
Malaysia and Vietnam are good examples.
In late 2021, both began offering limited-scale, resort-stay tourism at hand-picked destinations, such as Phu Quoc, Ha Long, Sa Pa and Da Lat in Vietnam, Langkawi in Malaysia.
The travel application and testing processes are complex, and flights, transfers, accommodation and tour bookings must be made through an approved local agent. This raises prices, constrains choice and centralises control over the entire process.
Time will reveal whether these are short-term expedients - or ‘pilot projects’ in the current vernacular - or will be integrated into future tourism policy planning.
3) Shaping the Market Composition
An accident of geography is now a factor for travelling to and from many countries.
We’ve become accustomed to governments selecting tranches of ‘eligible’ countries from which travellers can arrive. These are based on various criteria.
Thailand chose 63 countries for its quarantine-free Test & Go scheme. Vietnam 72 countries. The Philippines chose 159 eligible countries before Omicron forced it to postpone reopening.
It’s not just provenance that is under the microscope, but visitor demographics.
South East Asian governments have been outwardly pitching at ‘quality tourists’. This opaque ‘dollar-driven’ approach spans variable terminology. ‘High-quality tourism’ has been used in Indonesia; ‘high-yield tourists’ (Malaysia); ‘high-end tourists’ (Cambodia) and ‘high value-low impact tourism’ (Thailand).
While targeting affluent travellers, previously robust segments are de-prioritised.
“We will filter tourists that come visit. We don’t want backpackers to come so that Bali remains clean, where the people who come are of quality.”
Indonesia’s Coordinating Ministry for Maritime Affairs and Investment’s infamous statement about Bali’s new tourism direction was quickly retracted - but it was not without purpose. It was designed to show that Bali will shift its approach to tourism.
Is there any real substance to this pro-quality, anti-backpacker verbiage?
It could be viewed as political leaders being seen to say something meaningful to counteract over-tourism. Maybe it will all be long forgotten - but maybe not…
4) Introducing New Revenue Tools
The ancillary costs of travel will no longer be confined to airlines and hotels. Governments might also increase the privilege of visiting.
Cast your mind back to June 2020, when Cambodia imposed a USD3,000 “deposit” for all arrivals to be paid at the airport. This was to be held by the government in case travellers needed hospital treatment (and even for funeral costs!). It later reduced the figure to USD2,000, and then the issue drifted away.
Thailand set a USD100,000 minimum medical insurance coverage for visitors (later reduced), and a requirement for travel insurance to be purchased from a Thai provider.
This week, Thailand announced it will collect a THB300 ‘Tourism Fee’ from April. The utilisation of the fee remains opaque, with Bangkok Post reporting:
“The fee is expected to be transferred to the Tourism Transformation Fund managed by the Tourism and Sports Ministry. This fund aims to rebuild and develop tourism supply chains as well as offer safety and security for tourists.”
The economic impacts of COVID-19 suggest that new state-sanctioned fees will land during 2022.
5) Making Travel Policy a TV Statement
The ultimate demonstration of governmental interventions in travel and tourism is being made before the TV cameras.
Two years of travel economy decimation have made restoring vital employment-building inbound flows a priority for national leaders.
So, when Thailand commenced the Phuket Sandbox scheme on 1 July last year, Prime Minister Prayut Chan-o-cha was at the airport greeting the first arrivals.
Similarly, a joint press conference by Singapore’s Prime Minister Lee Hsien Loong and Malaysian Prime Minister Ismail Sabri inaugurated the bilateral Vaccinated Travel Lanes (by land and sea) in late November.
Travel policy as a photo opportunity. Now there’s a thing!
On this week’s The South East Asia Travel Show, Hannah Pearson and I embark on our 3rd annual travel wish list show, called 22 for 2022. We’ve created a list of 22 ways in which travel and tourism could become more efficient, more enjoyable, safer and more beneficial to everyone involved. Part II will be released next Friday.
Listen here:
🎧 Website 🎧 Spotify 🎧 Apple
Or wherever you grab your pods!
And, that’s a wrap for Issue 69.
Until next Sunday, find me on Twitter, LinkedIn, the Asia Travel Re:Set website and The South East Asia Travel Show.
Have a great week,
Gary