Tourism contributes 12.7 % to GDP in 2019

MANILA, Philippines — The tourism sector’s higher contribution to the country’s  gross domestic product (GDP) in 2019 underscores the crucial role of the industry not only to the economy, but also to employment generation as well, according to industry stakeholders.

Data released by the Philippine Statistics Authority(PSA) showed the country’s Tourism Direct Gross Value Added (TDGVA) amounted to P2.48 trillion in 2019, a 10.8 percent increase from P2.24 trillion in the year before.

This resulted in a 12.7 percent contribution to the country’s overall GDP, higher than the sector’s 12.3 percent contribution in 2018.

While the PSA reported last year that the tourism sector also contributed 12.7 to the Philippine economy in 2018, this figure was recently revised to 12.3 percent in line with the overall revision and rebasing of the Philippine System of National Accounts.

In addition, the data also showed that tourism employment reached 5.71 million in 2019, a 6.5 percent rise from 5.36 million in the year before. This translated to a 13.5 percent contribution to the country’s overall employment.

“Coming at a time when the country is grappling with the most devastating impact of this pandemic, we are inspired by this report as it affirms the vital role of our tourism sector in contributing to the economic recovery of our nation,” Tourism Secretary Bernadette Romulo-Puyat said.

Tourism Congress of the Philippines (TCP) president Jose Clemente III echoed Puyat’s sentiments, noting that figures show how vital a part tourism plays in the economy.

“Not only do we bring in revenues, but also generate employment both directly and indirectly,” Clemente told The STAR.

“We will be a substantial contributor once again once travel is restarted, but we need to be able to weather this storm,” he said.

The tourism industry is among the hardest hit by the coronavirus disease  2019 or COVID-19 pandemic.

Data from DOT shows that international arrivals for January to May 2020 dropped by 62.21 percent to 1.3 million arrivals from 3.49 million arrivals in the same period last year. Estimated inbound tourism revenues during the period plunged by more than 60 percent to P81.05 billion from P205.50 billion in the same period a year ago.

“The tourism industry is in dire straits for the foreseeable future due to the effects of the pandemic,”Clemente said. “We therefore urge the government to lend us assistance to avoid a potential collapse of this valued industry.”

Meanwhile, Puyat emphasized that the tourism sector was able to carry over its growth momentum from 2019 until January this year before COVID-19 decelerated the sector’s growth.

“Covid-19 broke our momentum. But it will bounce back stronger, and more resilient,” she added.

Data from the PSA also shows that among the forms of tourism, inbound tourism expenditure posted the highest growth in 2019 at 23.2 percent, followed by domestic tourism expenditure at 10.4 percent, and inbound tourism expenditure at 2.6 percent.

Inbound tourism expenditure within the country in 2019 rose to P 548.76 billion, a 23.2 percent increase from the P445.58 billion in 2018.

In contrast, domestic tourism expenditure increased to P3.14 trillion in 2019 from P2.85 trillion in 2018. The PSA said domestic tourism expenditure represents 22 percent of the household final consumption expenditure.

“The substantial growth in our TDGVA, inbound and outbound tourism expenditure, and employment in tourism demonstrates the value of the collective effort of our tourism stakeholders,” Puyat said.

“I have high hopes that the Philippine tourism industry will recover, and we will come out better from the current challenges that we face with the strong support from our stakeholders and partners,”she said.