THE ASEAN TOURIST INDUSTRY REVISITED : TRENDS AND PROSPECTS IN VIEW OF THE ASIAN CRISIS

Abstract

Tourism is one of the world's most dynamic and fastest growing industries. According to WTO forecasts, the number of international arrivals is expected to reach 661 million by the year 2000 and 937 million by the year 2010. In ASEAN, tourism has become one of the most important industries and ASEAN countries have been trying to develop their international tourist industry. The industry is not only the leading source of foreign exchange earnings but also a substantial employer of labor in many countries who are experiencing a boom in both foreign and domestic tourism. Even Laos, Vietnam and Myanmar, where income derived from tourism is still relatively low, are now attempting to expand their own tourism industries. The most recent factors influencing tourism in ASEAN started with the floatation of the baht around July 1997. The slowdown was almost entirely attributed to the financial crisis in Asia, coupled with weakening economies of two important origin markets, Japan and South Korea. Other crises which plagued the region included the haze from forest fires and the Indonesian riots. In addition, some of these factors snowballed, exacerbating their impact, canceling out the effect of the fall in currencies which made ASEAN a much cheaper destination. This thesis seeks to provide an overview of the ASEAN tourist industry and the effects of the Asian crisis on the travel trade, including the hotel industry. First, a comprehensive overview of the tourism trends in the nine ASEAN countries will be given. Second, the current situation and problems will be examined. Third, a regression model will be attempted to forecast tourism demand in Singapore. Finally, strategies to alleviate the situation will be evaluated and future prospects will be highlighted.