The Philippines seeks to expand halal tourism segment

Halal tourism looks set to become a key component of wider sector growth in the Philippines, as the government moves to support the segment’s development through a major investment drive. Globally, the halal tourism industry is recognised as holding significant opportunities for expansion, on the back of rising demand and a growing awareness of its potential. Keen to tap into the potential of the market, the Philippine government has taken steps to raise its profile both at home and abroad, with a focus on putting the necessary certification infrastructure in place.

Rising Popularity

According to a recent study undertaken by Thomson Reuters, in collaboration with strategy and research advisory firm Dinar Standard, halal tourism is fast becoming a highly lucrative segment of the global industry. Released at the end of January 2016, the study found that halal tourism currently accounts for 11.6% of global tourism expenditure, and this figure does not account for the seasonal impact of the Hajj and Umrah pilgrimages, when millions of Muslims travel to Saudi Arabia. The halal tourism market is projected to be worth $238bn by 2019, up from around $145bn in 2014.

Economic Benefits

The Philippines has sharpened its focus on tourism in recent years, with positive results. The country welcomed 5.4m visitors in 2015, up 11% on the previous year’s figures. Approximately 566,000 visitors – or 10.5% of arrivals – were from countries with a significant Muslim population, according to data issued by the Department of Tourism (DoT) in February 2016.

In early 2016 the DoT announced plans to team up with the international halal tourism authority CrescentRating to help promote the segment’s expansion. As part of the partnership, CrescentRating will help the country identify gaps in facilities and services, and develop a marketing campaign targeting Muslim travellers. The partnership plans to focus its efforts on Manila, Davao, Cebu and Boracay initially.

Announcing the launch of the initiative, Ramon Jimenez Jr, secretary of the DoT, underscored the industry’s broad growth potential.

“Improving the halal industry in our country will not only serve to advance the lives of Muslim Filipinos and attract more tourists, but it could also help spur growth in the Philippine economy,” he said.

Filipino Muslims accounted for 10m of the 54m domestic travellers in 2014, according to Arturo Boncat Jr, assistant secretary of the DoT.

Fast-Tracking Certification

In a separate development, the DoT announced a series of incentives in mid-January 2016 targeting tourism and travel operators, which it hopes will encourage them to obtain halal certification. The new scheme forms part of a broader bid to fast track the development of halal-friendly services. Under the initiative, the DoT has offered to cover the halal certification fees for at least 50 restaurants. The establishments targeted largely operate in hotels, resorts, and the meetings, incentives, conferences and events segment in Manila, Davao, Cebu and Boracay.

As part of its plans, the department is looking to issue a set of guidelines for the Muslim tourism market by April, ahead of Ramadan and the ensuing Eid Al Fitr holiday, when tourism traditionally spikes.

Complimentary Infrastructure

The drive to ensure the stringent standards for sharia-compliant products are met will be given a boost later in 2016, when a laboratory opens in Davao City, on the island of Mindanao. The facility will be tasked with overseeing consumer products testing for halal compliance. The laboratory, which is being constructed at a cost of P49m ($1.1m), should be operational by the fourth quarter of 2016, according to officials from the Department of Science and Technology. The opening of a further five testing centres is scheduled to follow in other regions, including Calabarzon, Zamboanga and the Autonomous Region of Muslim Mindanao.

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The Report: The Philippines 2016

Tourism chapter from The Report: The Philippines 2016

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