By Sherri Kimes
SINGAPORE — The tourism outlook for Singapore turned from picturesque to ghastly in a matter of a few months. Blame it on the pandemic.
In 2019, tourists spent S$27.7 billion in the sunny island. In the first quarter of 2020, however, tourism spending fell by 39 per cent to S$4 billion, compared to the same period a year ago.
With travel curbs, the number of tourist arrivals was also appalling. The first quarter of 2020 saw 2.7 million tourists, a 43.2 per cent decrease year-on-year. In April when Singapore’s circuit breaker started, visitor arrivals dropped by 100 per cent from a year earlier to a historic low of 750.
With Singapore’s borders remaining mostly closed to international travel, likely for a long time, it is natural to turn to domestic tourism. The government is hoping to capture a sliver of the S$34 billion Singaporeans spent in 2018 when they travelled overseas.
Still, that is a big hole to fill as the direct contribution from tourism to Singapore’s gross domestic product was 4 per cent in 2019.
To support domestic tourism, the government recently announced the S$320 million SingapoRediscovers Vouchers scheme. All Singaporeans aged 18 and above with receive a S$100 voucher that can be used for hotel stays, tickets to local attractions and tours. It will commence in December and continue until June 2021.
The vouchers complement the S$45 million SingapoRediscovers marketing campaign, launched in July to encourage locals to holiday at home and support local businesses.
This is a welcome boost for operators in the tourism and hospitality industries. Realistically, it may not fill the void left behind by international tourists. However, it will provided some needed revenue for the tourism sector. In addition, it will provide employment to a certain extent. Even if Singaporeans only spend 10 per cent of the S$34 billion that they spent overseas in 2018, it would still be quite helpful for companies.
Singapore is not the only country doing so. Other Asian countries have offered programmes that promote local tourism. For example, Japan’s “Go to Travel” programme offers Japanese residents 35 – 50 per cent discounts on domestic trips. South Korea’s US$140 million coupon programme is expected to lead to US$837 million in spending. China, Malaysia, Indonesia and Thailand have also rolled out programmes designed to support local tourism.
One of the concerns raised with such a programme is the potential safety risk given that there is still no vaccine for COVID-19. For example, Japan, when faced with a COVID-19 outbreak in Tokyo, adjusted their programme to exclude Tokyo (which of course caused a number of complaints). That being said, over 13 million Japanese residents used the vouchers between late July and late August this year, with only 11 people subsequently tested positive for the coronavirus.
Singapore will have all the safe management measures put in place and the tourism board has said it will continue to conduct enforcement checks to ensure that attractions can implement the necessary measures effectively even with larger capacity limits.
The next question is on the appeal factor. Will the vouchers have much appeal to well-travelled Singaporeans who may have a “been there, done that” attitude? Still, staycations have grown in popularity with Singaporeans in recent years. Consumers may find staycations even more attractive as costs go down with the use of vouchers. Attractions that resonate with more Singaporeans will get a larger piece of the pie as well.
Perhaps one thing for local tour operators to consider is to pair their tours with livestreams, which helps to increase exposure. They can also partner other businesses in selling their products.
Will the scheme help save the day for the local tourism industry? The jury is still out on this. But the tourism board cannot afford to sit on the sidelines.
Sherri Kimes is a Visiting Professor of Analytics & Operations at the National University of Singapore Business School. The opinions expressed are those of the writer and do not represent the views and opinions of NUS.