Economic crisis begins to hurt tourism

The global financial crisis has affected the tourism business in the Philippines, according to the National Statistical Coordination Board.

Romulo Virola, secretary- general of the agency, said that during the second half of 2008, the growth of tourism-related services sectors was slower than that of GDP, failing to continue the growth momentum that began in the third quarter of 2006.

The tourism industry, which accounted for about 6.2 percent of gross domestic product in the Philippines, expanded by just 1 percent in the third quarter of 2008 and 4.0 percent in the fourth quarter, below the 4.6 percent growth of the GDP last year.

Before the crisis, the tourism industry was growing by 8 percent to 12 percent per quarter, data from the board showed.

“Employment in tourism industries decelerated to 1.5 percent in 2008 from 3.7 percent in 2007, slower than the 2.6 percent growth of the total Philippine employment last year,” Virola said.

Employment in hotels and restaurants slowed down to 2.6 percent and 1.7 percent in the fourth quarter of 2008 and first quarter of 2009, respectively, after having grown by 7.2 percent in the second quarter of 2008 and 7.7 percent in the third quarter.

The growth of the gross value- added for hotels and restaurants and recreational services also slowed down to 0.78 percent in the third quarter of 2008 and 4.01 percent in the fourth quarter.

Despite the negative impact of the crisis on tourism, Virola said domestic tourism held much promise in stimulating economic activities.

He noted that tourism was the most stable industry in Baguio City over the past 20 years.

The tourism industry covers accommodation services, food and beverage serving services, transportation, travel agencies and other reservation services, entertainment and recreation. –Roderick T. dela Cruz, Manila Standard Today