SINGAPORE - Even as tourism growth in Singapore is expected to slow in the next decade from the previous brisk pace, the industry will still turn in a perfectly respectable performance when it closes the door on 2013. Visitor arrivals appear to be exceeding the conservative estimates set this year, though it remains to be seen if tourist spending will follow suit with a proportional increase.
Hotels continued to fill rooms at robust occupancies, while other operating indicators - such as the average room rate (ARR) and revenue per available room (RevPAR) - dipped from last year's record levels in the face of increased supply, a strong Singapore dollar and weaker corporate demand.
According to preliminary estimates from the Singapore Tourism Board (STB), visitor arrivals for January to October hit 12.92 million, up 8.4 per cent from the previous year, suggesting that STB's target for this year of 14.8-15.5 million may have been on the cautious side since Q4 is typically bolstered by the year-end festivities.
This also means that Singapore is well on track to hit a long-established target of 17 million visitors by 2015. However, tourist spending is an equally (if not more) important metric for the industry. Q1 data from STB showed that while arrivals were 9 per cent higher at 3.9 million, spending slipped 6 per cent to $5.7 billion from the corresponding quarter a year ago on weaker gaming revenue and a 6 per cent drop in business travellers (BT) and MICE (meetings, incentives, conferences and events) arrivals. Spending by BTMICE visitors fell 20 per cent that quarter. Q2 and Q3 figures have yet to be released.
"Industry feedback indicated that businesses were cutting down on trips and associated budgets, which led to a drop in spend across all components (in Q1 2013), including accommodation, F&B and shopping," said STB communications director Oliver Chong, adding that other regional markets also suffered declines in BTMICE arrivals that quarter.
Last year, Singapore attracted 14.4 million visitors who spent $23 billion in tourism receipts. STB is expecting tourism receipts to hit $23.5-24.5 billion this year.
After a decade in which tourism growth shifted into high gear, the rate is expected to essentially halve over the next decade, the government said earlier this year. From 2002 to 2012, tourism receipts surged at a compound annual growth rate (CAGR) of 10 per cent while arrivals increased at a 6.6 per cent CAGR.
Still, DBS Vickers analyst Derek Tan expects visitor arrivals to continue on an upward trend into next year, underpinned by a healthy outlook for travel in South- east Asia and a strong pipeline of MICE events which include the 2014 Singapore Airshow. For 2013 as a whole, he projects spending of $24 billion by a total of 15.5 million tourists.
"We expect visitor arrivals to grow 6 per cent year-on-year to 16.3 million in 2014," he said.
This year, the River Safari joined the growing list of tourist attractions which the Republic has to offer, while the Kallang Sports Hub will host a number of major sports events when it opens its doors next year.
Since its soft opening in early April, more than 500,000 people have visited the River Safari, of which a third were tourists, though Wildlife Reserves Singapore expects the percentage of tourists to rise in coming months. The River Safari will have its official launch in Q1 next year, after the Amazon River Quest boat ride started operating this month.