In 2019, Southeast Asia’s tourism market was booming. The six largest economies within the area (Indonesia, Thailand, Singapore, Malaysia, Vietnam, and the Philippines) mixed for over 127 million vacationer arrivals that 12 months. These guests spent tens of billions of {dollars}, contributing considerably to regional financial exercise.
After all, issues modified dramatically when the COVID-19 pandemic arrived in 2020. As lockdowns and border closures went into impact, complete vacationer arrivals in those self same six international locations dropped to simply 2.6 million in 2021, greater than half of which got here from Indonesia.
The restoration has been gradual, actually slower than an export-oriented nation like Thailand would really like, however tourism within the area is beginning to get its legs again. In 2022, the six huge ASEAN economies recorded 39 million vacationer arrivals. Final 12 months, it was as much as 91 million. Maybe 2024 is the 12 months when inbound tourism will return to pre-pandemic ranges of 120-130 million.
Unsurprisingly, Thailand is main the restoration. In 2019, a staggering 40 million tourists arrived in Thailand, producing $60 billion in journey service exports. Final 12 months, there have been 28 million arrivals, round 71 p.c of pre-pandemic ranges, and the Financial institution of Thailand recorded $30 billion in export earnings from the journey sector.
These numbers are greater than different economies within the area, however as a result of tourism is so central to the Thai mannequin of financial progress and since the business nonetheless hasn’t totally recovered to 2019 ranges, there’s been some lag within the general financial system. That is one purpose why the Thai authorities is considering uncommon coverage responses, like the massive money stimulus program that’s within the works.
Malaysia has bounced again fairly shortly, with 20 million tourist arrivals in 2023. That’s 77 p.c of pre-pandemic ranges. Receipts from tourism had been $15.8 billion, 83 p.c of pre-pandemic ranges. Malaysian tourism, nevertheless, is a little bit of an outlier as it’s closely depending on Singapore and might be not an ideal barometer for wider regional or international journey tendencies. 8.3 million arrivals in 2023 had been from Singapore. Talking of Singapore, the island-nation noticed 13.6 million international visitor arrivals in 2023, a rise of 116 p.c in comparison with the earlier 12 months.
Nations like Indonesia, the Philippines, and Vietnam are maybe extra indicative of regional tourism tendencies. At 11.7 million inbound guests in 2023, Indonesia’s tourism sector is unquestionably recovering, however nonetheless in need of the document 16.1 million who arrived in 2019. Identical to then, the vast majority of these vacationers are headed towards Bali, which is beginning to really feel the squeeze from overcrowding and site visitors congestion as soon as once more. To ease the burden on Bali, the federal government has been making an attempt to market locations in different elements of the archipelago, like Labuan Bajo, however provided that 5.2 million vacationers nonetheless arrived at I Gusti Ngurah Rai airport final 12 months, Bali stays the marquee attraction.
The Philippines additionally lately sought to stimulate its tourism industry with a splashy rebrand because it recovered from the pandemic. In 2023, they unveiled a brand new “Love the Philippines” marketing campaign however got here underneath fireplace when it was found the marketing campaign had used inventory pictures of different international locations. The Philippines is trailing its regional opponents within the tourism sport by a large margin, with simply 5 million overseas guests in 2023. That is 61 p.c of pre-pandemic ranges, whereas different main economies in Southeast Asia are at 70 p.c or above.
Tourism in Vietnam was rising at an explosive price previous to the pandemic, with inbound guests hovering from 8 million in 2015 to 18 million in 2019. This progress was propelled by giant numbers of vacationers coming from China and South Korea. In 2019, Vietnam noticed 5.8 million Chinese language vacationers and 4.3 million South Koreans. In 2023, Vietnam’s inbound tourism recovered to 70 p.c of its pre-pandemic stage, with 12.6 million guests. However whereas South Koreans are returning to Vietnam in giant numbers (3.6 million final 12 months) Chinese language guests haven’t, and at 1.7 million stay nicely beneath 2019 ranges.
That is true typically across the area, and it may assist clarify why it’s taking a couple of years for the business to get again to the place it was. Chinese language vacationers had been an enormous a part of Southeast Asia’s pre-pandemic tourism growth, and to this point inbound journey from China has been gradual to get well. Given the 2023 trajectory and the truth that many currencies within the area are anticipated to stay weak in 2024, Southeast Asia may quickly be primed for a return to 2019 ranges of vacationer exercise. It will likely be fascinating to see whether or not, and to what extent, Chinese language vacationers returning to the area is a part of that story.
