Gov’t banks on tourism to bring in more dollars

The government targets to boost the number of foreign visitors to the Philippines to 10 million a year, eager to make tourism one of the country’s biggest sources of foreign exchange together with remittances and foreign investments in business process outsourcing (BPO).

Finance Secretary Cesar Purisima, who also sits in the policy-making Monetary Board of the Bangko Sentral ng Pilipinas, said the Aquino administration wanted to further increase the country’s total reserves of foreign exchange from a record high of more than $80 billion last year through tourism.

He said the current administration wanted tourist arrivals to more than double to 10 million in 2016, the end of President Aquino’s term.

“The President wants to build a third, strong leg in the country’s foreign exchange position together with remittances and BPO investments,” Purisima said.

In 2012, tourist arrivals to the Philippines hit a historic high of 4.27 million. The number was up 9 percent from 3.92 million the previous year but short of the government’s target. Tourism receipts grew as well, expanding by 17 percent year on year to about $3.7 billion. This amount, however, remained anemic compared with remittances and foreign investments in the BPO sector.

In this year’s Philippine Development Forum (PDF) in Davao City that ended on Tuesday, representatives from the government and foreign lenders agreed to make tourism one of the major priority areas for development.

The World Bank, which helped organize the PDF, said spending for tourism and agriculture infrastructure should be boosted to achieve the goal of job creation. With sufficient funding support, the World Bank said the tourism sector could quickly generate jobs and help lift people out of poverty.

Tourism is believed to be a low-hanging fruit for the Philippines. Economists said that given the country’s natural resources, the revenue potential of tourism remained largely untapped.

Last year, the country’s gross international reserves hit nearly $84 billion, the highest on record. The amount was enough to cover nearly a year’s worth of the country’s import requirements and about six times the country’s short-term, foreign currency-denominated debts.