Manila: The weakening Korean won is expected to impact the country's inbound travel in 2025, Leechiu Property Consultants (LPC) said. Korean won fell to its lowest level in over 16 years on April 8, following the Trump administration's announcement of sweeping 'reciprocal tariffs' on states, prompting fears of a global trade war.
According to Philippines News Agency, citing the Department of Tourism (DOT) data, LPC Director for Hotels, Tourism, and Leisure Alfred Lay stated that the first quarter figures indicate the tourism sector is 'plateauing' in terms of increasing international visitor arrivals. Lay highlighted that external factors, like the decline in arrivals from South Korea, a top source market, contribute to this trend.
In the first quarter of 2025, the Philippines received 395,059 visitors from South Korea, a decline of 13.86 percent from 458,619 the previous year. This South Korean segment accounts for almost a quarter, or 23.88 percent, of overall inbound arrivals, a key driver of the country's pandemic rebound. Lay emphasized the need to address this significant drop.
Furthermore, Lay noted China's absence from the top five source markets signifies a major shift, marking the first time it has fallen off the list since the DOT began tracking tourist data online in 2008. Leechiu estimates that tourist arrivals will plateau at 6 million by the end of 2025. Despite growth in markets like the US, Japan, Australia, and Canada, which saw increases in arrivals, Lay expressed concerns about maintaining momentum without major changes.
On the hospitality front, the country's hotel occupancy rate in 2024 aligned with the Southeast Asian average, signaling a need for a catalyst to boost the sector. The LPC Philippine Property Market Report for the first quarter of 2025 indicated a 60 percent hotel occupancy rate in 2024, up from 59 percent the previous year. Lay noted the upper-scale hotel segment is thriving due to strong pricing power and a 'flight to quality' by travelers.
Tourism Secretary Christina Frasco reiterated the DOT's commitment to diversifying the country's tourism products to attract more high-spending tourists. Although the country fell short of its 7.7 million arrival target in 2024, it achieved an all-time high tourism revenue of PHP760.5 billion, an increase from PHP697.46 billion in 2023. Frasco attributed the below-target arrivals to the significant decrease in Chinese visitors and the suspension of electronic visas for the market.
