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Singapore tourism industry to get S$700 million boost over next five years
THE local tourism industry will get a S$700 million shot in the arm over the next five years through the latest tranche of the Tourism Development Fund (TDF), which is designed to help the industry reposition itself for growth with an eye on near-term headwinds and future opportunities.
While the fundamentals for tourism remain strong in the long term - thanks to Asia's emerging middle class and a rising demand for travel in the region - short-term headwinds will come from an uncertain global economy, regional competition and domestic resource constraints.
Minister for Trade and Industry (Industry) S Iswaran, speaking at the annual Tourism Industry Conference on Monday, said: "Against this backdrop, we need two types of responses - strategies that will best position us to benefit from long-term growth opportunities, and tactical measures to deal with volatility and challenges in the short term.
"Essential to the efficacy of both these responses is the need for all stakeholders in the tourism sector to come together to coordinate efforts and resources."
This third tranche of TDF money will broadly support three key areas, namely, the developing of products to keep Singapore a destination of choice, leveraging technology to increase productivity and improving manpower skills.
Among other things, investments will be channelled towards niche sectors with potential for growth - the cruise industry, for example - as well as supporting the adoption of technology, such as data analytics or retrofitting of hotel premises.
After fairly robust growth between 2010 and 2013, visitor arrivals and tourism spend have moderated in recent years, hit by a confluence of factors, among them the strong Singapore dollar.
Arrivals appear to have picked up in January and February this year from the first two months of last year. Visitor arrivals rose 12.3 per cent to 2.7 million; figures for tourism receipts have yet to be released.
For 2015 as a whole, arrivals edged up just 0.9 per cent to 15.2 million; spending by visitors slumped 6.8 per cent to S$22 billion, weighed down by a drop in business travellers.
Big-spending visitors known in the industry as BTMICE (business travellers and those attending meetings, incentives, conventions and exhibitions) are a crucial segment. Although they make up just a fifth (20 per cent) of all travellers, they account for a third of total tourism receipts.
This year, the STB has cautiously forecast growth of between zero and 3 per cent for visitor arrivals, and between zero and 2 per cent for tourism spend, amid a weaker global economy and shrinking corporate budgets.
In his speech at the conference, Singapore Tourism Board (STB) chief executive Lionel Yeo charted out the tourism organisation's plans to pull in high-yielding tourists over the next five years, singling out areas such as marketing, technology and manpower.
Aside from continuing to focus on key source markets such as Indonesia, Malaysia and Australia, the STB will boost marketing and trade engagement in secondary cities in Indonesia, China and India. It will also look into ramping up marketing in emerging countries such as Myanmar and promising long-haul markets in Europe and the US.
In particular, specific segments of travellers are being looked at, namely business travellers, families with young children, working millennials and active older travellers.
For instance, last year, the STB supported 27 per cent more business events than in 2014, when nearly S$500 million in tourism receipts was generated. Mr Yeo added in his speech that STB would continue to support quality MICE events that bring in large numbers of higher-yield visitors, for example by giving more support through the Business Events in Singapore (BEiS) fund to encourage different players to collaborate on projects.
He also stressed the need to get more Singaporeans to enter the tourism sector. The STB has been working with the Singapore Hotel Association (SHA) and hotel-industry heavyweights to develop a career strategy for Singaporeans. In addition, a S$5,000 SkillsFuture Study Award will be made available to mid-career tourism professionals looking to upgrade their skills.
Also in the works is a one-stop mobile app which customises experiences for each visitor, smart kiosks and an online platform which will aggregate information on the services, events and promotions of local tourism players.
The idea is to present the city-state as "a single, unified, mega attraction" as opposed to a collection of individual attractions, said STB chief technology officer Quek Choon Yang.
Commenting on the enhanced BEiS fund, industry players such as SHA, the Sentosa Harbourfront Business Association (SHBA) and the Singapore Association of Convention and Exhibition Organisers and Suppliers (Saceos) said that it would pave the path for stakeholders to band together and submit joint bids to host major events in Singapore.
Saceos president Janet Tan-Collis said: "With these intiatives, I see a lot more collaboration." Citing various precincts such as Sentosa and Orchard Road, she added: "If we can all agree to work together, I think ... Singapore can win."
SHBA chairman Khoo Shao Tze said a venue such as Singapore Expo would work for large-scale events, while Sentosa can handle the evening parties, which makes Singapore a more compelling destination.
"It's just a matter of running shuttle buses," said Mr Khoo. "This funding would come in useful for such bids."