Singapore to re-position itself to win back the tourist dollar

Singapore is struggling to attract the tourist dollar in spite of its ability to lurevisitors to its shores. In a recent position paper, the Singapore Tourism Board (STB) revealed figures showing the exact extent of the erosion and its strategies to regain lost ground.

Tourism receipts have been falling, despite its success in overcoming the drastic drop in arrivals following SARS (severe acute respiratory syndrome) in 2003. It finished 2003 with a creditable 6.1 million visitors while 2002 registered the second highest number of arrivals in its history with 7.6 million visitors.  Between 1993 and 2002, tourism receipts declined by 21 percent from S$11.1 billion to $8.8 billion. 

Meanwhile, the sector’s contribution to GDP (gross domestic product) fell from 6 percent to 3 percent.   The Board pointed out that the leisure segment contributed most to this decline, and within it, shopping.

To rub salt into the wound, this dismal trend was registered against a backdrop of growing tourism receipts in the region. Tourism receipts in East Asia Pacific grew by 6.4 percent per year from US$66 billion in 1998 to US$85 billion in 2002. As a result, Singapore’s share of the region’s tourism receipts fell from 8.2 percent to 5.8 percent during this period.

In contrast, Singapore’s neighbors have been able to ride the boom: Malaysia’ tourism receipts have jumped from 3.7 percent to 8.8 percent while Thailand has kept pace with only a marginal decline from 9 percent to 8.4 percent.  The Board attributed the cause to under-investment on Singapore’s part at a time when its neighbors have enhanced their destination appeal. “Singapore has under-invested in new tourism products in the last decade. Fixed asset investment in attractions in Singapore dropped to an average of S$63 million per year between 1995 and 2001, as compared to S$168 million a year in the early 1990s. Investments in the leisure and attractions sector had been hampered by high land and business costs and exacerbated by government regulations which are not so friendly to the service industry,” it said.

Its product differentiation is being whittled away by new initiatives in neighboring countries, a fact which led one of STB’s international advisory panel members to remark, “Singapore is so middle of the road that it is in danger of being bypassed.”

The way to reverse the trend, according to the Board, is to re-position Singapore. “We will re-position Singapore as a great destination for families and for premium travelers in order to tap the strong and fast-growing leisure traffic from China, India and the ASEAN (Association of South East Asian Nations) countries.

“Singapore will also be re-positioned as the “services center” of the region, offering a range of services to cater to the increasingly affluent population of the region. As part of the multi-agency initiative, STB has already started to promote aggressively health-care and education services since last year, including in new markets like China and India,” it said.

The Board also recognized the role that the private sector can play. “Step by step, we should continue to facilitate investment by liberalizing our rules and regulations to give our private sector the additional space to experiment and innovate,” it added. – your news source for the travel and tourism industry.

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