Singapore had good reason for cheer this week as the Singapore Tourism Board announced that tourism spending in 2024 is on track to hit an all-time high, surpassing the pre-pandemic high of $27.7 billion in 2019.
International Visitor Arrivals (IVA) increased by 21% (compared to 2023) to 16.5 million, showing robust growth despite industry concerns that high prices in the destination would put off leisure travellers in particular.
Tourism receipts reached $22.4 billion between January and September 2024 (an increase of 10% compared to the same period in 2023). All spend categories have shown year-on-year growth, led by Sightseeing, Entertainment & Gaming (SEG) at 25%, followed by Accommodation at 17%.
Meanwhile, Food & Beverage (F&B) and Shopping saw a 6% and 5% increase respectively, with other categories such as airfares and business spending contributing to TR as well.
Mainland China, Indonesia, and Australia emerged as the top tourism receipts generating markets, contributing $3.58 billion, $2.13 billion, and $1.44 billion respectively (excluding Sightseeing, Entertainment and Gaming). Notably, Mainland China and Japan showed strong year-on-year growth in tourism receipts.
Top markets for visitor arrivals were Mainland China (3.08 million), Indonesia (2.49 million) and India (1.20 million). Other markets that exhibited healthy year-on-year growth included Japan, Taiwan, the UK, and the USA, representing a good mix of short, mid and long-haul markets.
Contributing factors included the 30-day mutual visa exemption with Mainland China, and strong growth in air connectivity. In 2024, Changi Airport had a total international seat capacity of over 41 million, representing a 15% increase compared to 2023 and 98% recovery to 2019.
In addition, hotels demonstrated positive growth in 2024, with Average Room Rate (ARR) and Revenue per Available Room (RevPAR) increasing year-on-year, reaching $276 (1.4% increase compared to 2023 ARR) and $226 (3.0% increase compared to 2023 RevPAR) respectively.
Average Occupancy Rate (AOR) was 81.8% in 2024, a 1.3% point increase compared to 80.5% in 2023. There was an addition of 1,421 new hotel keys, including notable openings such as The Standard Singapore, Into the Woods and Mercure ICON Singapore City Centre.
Melissa Ow, Chief Executive, Singapore Tourism Board (STB), said, “In 2024, Singapore’s tourism sector posted a strong performance, an affirmation of the industry’s efforts in refreshing our products and experiences, as well as embarking on new collaborations this past year. Collectively, these efforts elevated Singapore’s destination appeal and strengthened the sector’s capabilities and competitiveness.”
More work to be done “before we pop the champagne”
While celebrating the news, Arthur Kiong, CEO of Far East Hospitality Group, sounded a note of caution in his LinkedIn post, saying, “Yes, the glass is half full. Well done and all that, but let’s not forget – Singapore still has some way to go before we pop the champagne.
“New hotel openings last year added 1,421 rooms, ranging from family-friendly destinations to business traveller-friendly accommodation. Since 2019, Singapore’s hotel supply has grown by about 5%, while visitor arrivals remain about 13% below the 2019 level of 19.1 million.
“This is our collective challenge.
“The average hotel occupancy rate of 81.8% is still below 2019’s 86.9%. More importantly, while average room rates and revenue per available room have grown, they’ve barely kept pace with inflation.
“So, while the top-line numbers look rosy, the bottom line tells a different story. There’s work to be done.”
The work is largely in Singapore’s strategy to position itself as a premium destination with business travel and the MICE sectors a large focus of efforts this year.
Said Kiong, “Singapore’s strategy to reposition itself as a premium destination is largely working. As new hotels, restaurants, and retail concepts emerge, those that are no longer competitive will need to refurbish, reinvent, or risk obsolescence. This relentless renewal is what keeps Singapore viable as a tourism destination.
“While we’re not attracting bargain hunters, we’re drawing a new wave of travellers looking for uniqueness and authenticity.
“The shift is happening. Slowly but surely, our recovery from the pandemic – which seems so long ago – is happening.”
