Trials and Tribulations for Myanmar's Travel Industry
By The Irrawaddy 6 October 2018
Kyaw Kha: Welcome to Dateline Irrawaddy! This week, we’ll discuss whether Myanmar is ready to receive international travelers. I’m The Irrawaddy chief reporter Kyaw Kha and I’m joined by U Khin Aung Tun, vice president of the Myanmar Tourism Federation, and tour operator Daw Sabei Aung.
On Monday, Myanmar granted visa exemptions for some Asian countries, which I think is a good move for the country’s tourism industry as tour season is drawing near. So what is your take on the visa exemptions?
Khin Aung Tun: Tourist arrivals this year have declined by about 2 percent compared to the previous year. The number of Western travelers has declined especially due to the Rakhine crisis. So, [the Myanmar government] is pursuing a “look East” policy and granted visa exemptions for travelers from Japan, Korea, Hong Kong and Macao and issued visa-on-arrival for Chinese citizens as of Oct. 1. Taking a look at tourist figures for our country, travelers from Eastern countries accounted for some 70 percent, and those from Western countries around 30 percent. Those from Western countries stay longer and have more spending power than their Eastern counterparts. As their numbers have dwindled this year, we can conclude that our country’s tourism industry has declined. The visa relaxation introduced for travelers from Asian countries will help increase the number of tourist arrivals, and this will make up for the decline in Western travelers, I think.
KK: The visa relaxation is good for the country. But there is a Burmese saying: Guests will only come when your house is pleasant. How pleasant is our country to attract travelers? What requirements do we still need to fulfill?
Sabei Aung: We should think from the point of view of travelers. Yes, we have to preserve our traditions and culture. But at the same time we need to think globally. Myanmar is a very beautiful country with Inle Lake, Shwedagon Pagoda, mountains, snow-capped mountains, beaches and ancient pagodas like Bagan. But it is not Myanmar alone that has those things. Cambodia, Vietnam and Thailand also have them, and they are much the same in the eyes of foreigners. I have visited Europe, and churches in Belgium or England or the Netherlands are much the same to me. I could differentiate them if I were to study a lot about their history. But to my eyes they appear the same. People are the same, the food is the same, the weather and environment are the same. Similarly, Asian countries are much the same in the eyes of Western travelers. When I was a tour guide, I had to make a lot of efforts to explain that the structure of Myanmar pagodas was different from those in Thailand. While travelers have to spend about $600 to visit Thailand, they have to spend about $ 2,000 to visit Myanmar. So travelers buy the cheaper tour packages from their tour operators. Price is one of the main points. I’ve frequently said that Myanmar is a tiny tourist spot on the tourist map. There are many people who don’t know Myanmar. The total number of globetrotters is expected to be around 4 billion by 2020. But Myanmar only receives around 3 million visitors [a year] at present. So Myanmar has huge potential to receive more travelers. How can we attract them? Suppose they pay a high price and visit our country. They walk along U Bein Bridge and smell urine and see rubbish heaps riddled with flies. And they have to stay at hotels that do not meet international standards. If they have to pay $50 to $100 for a hotel room in Myanmar while they can get better facilities for around $20 in other countries, they won’t want to come to Myanmar. We have blamed the western gate problem [the Rohingya crisis] for our country’s tourist decline. But then, if you analyze carefully, the decline is 50 percent because of high prices. You go to Vietnam and there are a sufficient number of clean toilets everywhere. And it is the same in Thailand. And they smell good. It has made huge investments in tourism, and it is ahead of us by 20 years. In Myanmar there is a problem with sanitation. I think about 70 percent of the tourism budget should be spent on regional cleanliness, environmental conservation and capacity building. Thirty percent is enough for tourism promotion campaigns, and the remaining 70 percent should be spent on beautifying the country. In tourism promotion campaigns in foreign countries we advertise that our country is beautiful. But when tourists come to Myanmar they find that it is just the opposite. There is a need to clearly understand which areas the tourism budget should be spent on.
KK: If we are to increase revenue from the tourism industry, reforms are necessary. What reforms do you think should be made? Or do you think the right people are not in the right places?
KAT: I’ll talk about two things — short-term and long-term solutions. As for the short-term solutions, visa exemptions can be granted as authorities have done and border gates can be opened for tourism-related businesses such as hotels, restaurants, tour companies and tour guides to recover. At the same time, we should initiate reforms at the national level. In Singapore, there is a Singaporean Tourism Board professionally managed by the chief executive officer. Even if we can’t do like that, we should run a semi-government agency like the Tourism Authority of Thailand. We should reconstitute our organizations professionally and manage the budget responsibly and with accountability. But [tourism organizations in Myanmar are led by] businessmen. But we can’t always make time [for the organizations], and we can’t run them 100 percent professionally. So those who have time and can manage them professionally should be appointed to lead the organizations, for example a tourism authority of Myanmar. It would be better and more effective for the country. Destination management organizations might be formed in respective regions and states under the tourism authority. Only then will we be able to get close to countries like Laos and Cambodia that are ahead of us. I don’t say to catch up or pass them. There should be clear policies about how to use the tourism budget systematically. And what are our weak points? The Rakhine [Rohingya] issue has had a serious impact that we didn’t expect because we were very weak at crating a counter-narrative. We are also weak at digital marketing, environmental conservation, sanitation and beautification, and infrastructure including public toilets. And there must be policies on punishment for littering. An anti-plastic bag campaign has been conducted in Bagan for four, five years. But Myanmar tourists still litter. There is a need to think comprehensively to address all those problems. These are the long-term plans. Only by implementing both short-term and long-term plans will the tourism industry be the industry that contributes the most to the GDP of the country. The country’s leaders should place greater focus on the tourism industry, which has high potential for development.
KK: Daw Sabei Aung, you seem to be frustrated with the country’s tourism industry. What requirements need to be fulfilled to improve the industry?
SA: We do want to see tourism develop in Myanmar regardless of the tone we use in pointing out the shortcomings. I am frustrated with the current state of Myanmar’s tourism industry. Leaders might have difficulties. They have the right to report their difficulties like we have the right to point out [their shortcomings]. Either tourism policy makers or the ministries or the associations must be on the right track. Formed under the previous governments, tourism-related institutions have existed for a long time in Myanmar. But those institutions are not strong. Those institutions only exist as frameworks and do not have actual force. For example, an organization has a president and a secretary but lacks the workforce. So institutions are weak. But what about the [government] departments? Taking a look at the ministries, they don’t function well.
KK: There is criticism that the right people are not in the right positions in most of the ministries. What do you think [regarding the Hotels and Tourism Ministry]?
SA: It is part of the problem. Another problem is they don’t understand the importance of teamwork. They want to be the key actor. This is wrong. As Ko Khin Aung Tun said, we should think about how to strengthen the institutions, such as the tourism board and the ministry. The ministry has many experts who have sunk into obscurity. Why can’t they display their expertise? We need to find this out. In our country, institutions are not yet strong enough and the ministry still can’t function properly. At such a time, government support is important. There are two parts — technical and financial. [The tourism industry] has not yet received sufficient support either technically or financially. So on the ground, places are not beautiful and clean enough. And we are lagging behind other countries in tourism promotion techniques. In Yangon and other region and state governments, there are tourism ministers. But they apparently have no role to play. There are institutions and a tourism minister at the union level, but there is a lack of communication between them and regional tourism ministers. If regional tourism ministers have extensive knowledge of tourism, expertise and roles to play, the national tourism industry will be well connected.
KAT: But regional tourism ministers are not solely responsible for tourism. They have to serve as the municipal or ethnic affairs or construction or financing and planning minister at the same time. So [tourism] is not their top priority. Again, it largely depends on to what extent chief ministers are interested in and understand tourism. I want the government leaders to specifically state that tourism is a priority for the country the way government leaders did in Indonesia and Thailand, like what the Indonesian president said at the Indonesian investors conference, or the way the Thai prime minister intervened regarding the [boat accident involving] Chinese travelers. We want [the government] to encourage [the tourism industry] more. Much remains to be done in that regard. Cooperation from the ministry is very weak. Though there are now visas on arrival, Chinese tourists only use Alipay and WeChat Pay for mobile payments. We are not yet ready to accept Alipay. The Central Bank [of Myanmar] is still considering whether to accept it. These requirements need to be fulfilled simultaneously. Without those services, how can Chinese tourists make payments? These are the problems on the ground. This indicates that the decision-making process is very weak and that cooperation from the ministry is also weak. This is one of the reasons behind the decline of the tourism industry.
SA: Revenue from the tourism industry is flowing out of our country. Dollar revenue from the tourism industry comes into the country illegally, not through the official banks. It is because of the high money transfer charges. Millions of dollars from the tourism industry come into the country illegally. Secondly, there are online hotel booking sites like Hotels.com, Agoda.com and Expedia.com. There are millions of dollars worth of transactions via OTAs [online travel agencies]. But the money goes back to the home countries of those OTAs and doesn’t get into our country’s banks.
KK: You mean money comes into our country illegally.
SA: I mean millions of dollars earned by locals businesses are not transferred into the banks legally.
KAT: Because of the high charges, money is transferred illegally.
SA: This affects our country’s dollar flow. Dollars will flow into the country if the interest rate is fixed at 1 or 1.5 percent and banks are allowed to operate freely. Then we will see an influx of dollars into the country. And there is money that flows out of the country. For example, a hotel rents its rooms, but the dollars go to other countries because [the rooms are booked] through OTAs. We should also find ways to make the money flow into the country. Here, we need to work in cooperation with hotels.
KK: Thank you for your contributions!
Translated from Burmese by Thet Ko Ko.