Southeast Asia will be at the forefront of the recovery of tourism in Asia Pacific in 2022, according to the latest report from Southeast Asia will be at the forefront of the recovery of tourism in Asia Pacific in 2022, according to the latest report from Jones Lang LaSalle (JLL).
After two years of strict restrictions due to the pandemic, Southeast Asian countries are gradually easing – and in some cases lifting – the controls that halted the tourism sector in this part of the world. With vaccination rates fluctuating between 55% and 90% at the time of Jones Lang LaSalle (JLL) reportrelease in March 2022 combined with a far less virulent Omicron variant, countries in Southeast Asia are taking steps to learn to live with Covid-19.
The ASEAN which brings together 10 countries in Southeast Asia (Brunei, Cambodia, Indonesia, Lao PDR, Malaysia, Myanmar, Philippines, Singapore, Thailand and Vietnam) has been welcoming international travellers since late 2021 and beginning 2022, albeit at a different pace.
Lifting restrictions accelerate in Southeast Asia
Findings in the JLL report indicate that Thailand’s was the country that initiated the reopening to international tourism back in July 2021 with the Phuket Sandbox programme – although Cambodia had begun welcoming tourists in May 2021. It was followed by Singapore with its vaccinated Travel Lanes (‘VTL’) initiative. Since then, there have been a number of initiatives launched across the region to boost tourism.
Measures to reopen Southeast Asia accelerated since. After implementing VTLs with more countries, Singapore has announced to reopen its borders to all fully vaccinated travellers from April 1st, without quarantine. Thailand reinstated its quarantine-free visa programme in February 2022 – also known as ‘Test and Go’ – initially implemented in November 2021. Since then, it will lift all restrictions from June. Other Southeast Asian countries such as Indonesia, Lao PDR, Malaysia or the Philippines have followed the move with borders fully reopened now and minimal or even no Covid-19 linked health protocols.
Thailand could receive the highest number of tourists in ASEAN in 2022 with 5.5 million tourists in 2022 followed by Vietnam. The country now targets to welcome 5 million international tourists in 2022 with its reopening in mid-March. The Philippines Department of Tourism is expecting 2 to 5 million international tourists in 2022 while Indonesia expects now 3 million international travellers.
A new dynamic for the hotel sector
With international tourists eager return to Southeast Asia, combined with major government initiatives to boost the region’s tourism sector, 2022 should record a higher number of new hotels entering the market.
In parallel, asset enhancement initiatives introduced during the pandemic while the market was softer, are likely to coincide with the new openings. Therefore, the hotel landscape is expected to gain in quantity, but also in quality to target international and domestic tourists, leisure and business demand, with average length of stay
anticipated to be longer.
Amid the initiatives to reopen borders and ease restrictions in the sub-region, domestic demand should continue to lead the recovery of tourism in the next twelve months. Destinations in Southeast Asia are expected to record gradual increase of international visitors – both leisure and corporate – towards the second half of the year with more flights resuming, coupled with expected restored confidence in travelling abroad.
With this positive outlook, JLL sees investors back in the region to acquire hotel assets, anticipating the return of travellers. Destinations in Southeast Asia are expected to record a total hotel investment volume of USD1.5 billion for the full year 2022, a significant rise of 86% year-on-year.
More specifically, Singapore and Indonesia are expecting to record the highest year-on-year growth in 2022 as measured by investment volumes. In Bangkok, following a significant number of projects postponed from initial opening in 2020 and 2021, many hotels are slated to start supply is slated to start operating in 2022 with nearly 50 additional properties representing over 8,000 keys. Kuala Lumpur in Malaysia is also due to see the addition of approximately 3,700 rooms in 2022.