Skift Take

In a region of the world out front in shifting away from pandemic status, the formula is quite easy to figure out, for now: Endemic = less restrictions = more tourists = faster travel recovery = stronger economy.

Set to welcome international travelers from next month, Malaysian Prime Minister Ismail Sabri Yaakob announced the country’s transition to the endemic phase; neighboring Thailand has set July 1 as the deadline to declare Covid as endemic.

Having done away with its Covid-zero strategy, Singapore is moving ahead with its plan to treat Covid as endemic, while the Philippines’ move to relax travel restrictions is also in tune with the archipelago’s adoption of an endemic mindset.

The clarion call from Asian tourism hubs to declare Covid as endemic is providing an element of stability to a sector fraught with uncertainty triggered by government flip-flops around border reopening. Along with parts of Africa, Asia is out front with the shift to an endemic stage.

Travel under the pandemic globally has certainly been a quagmire of confusion, but Asia, in particular, has been particularly hard to get a handle on with rules changing so often from country to country — some super strict, others not as much. An endemic stage will certainly go a long way to ease those frustrations for travelers, and give destinations an opportunity to market again without so many caveats for entry.

As many Asian countries initially approached a close-to-zero Covid policy, consulting firm McKinsey observed that the return to travel has been slower in Asia than much of Europe and the Americas. In 2021, for example, Asia-U.S. flows witnessed the slowest recovery at only 17 percent of 2019 levels, Asia-Europe was not much better at 22 percent.

“The tourism and hospitality industries have not only had to cope with lower travel demand over the last few years, but also a large amount of uncertainty amidst a constantly-changing regulatory environment,” said Hermione Joye, Google’s sector lead for travel in APAC. “Moving to an endemic phase will hopefully provide a stable and more predictable environment for these industries to grow — not just in terms of revenues, but also in their ability to attract, retain and train the talent needed to take the industry to new heights.”

Joye observed that the move to endemic could also help reduce travel-related friction involving confusion around destination entry, costly testing, quarantine guidelines, insurance requirements, etc. 

Even as moves such as vaccination certificates would continue to remain in place to help travelers feel safe, the shift to the endemic phase would help to offer a more seamless and less complex travel experience.

Citing pent-up demand, McKinsey hoped travel would bounce back sharply after restrictions are removed. “With a lot of cross-elasticity between destinations, travelers would make their choice depending on where the entry requirements are clear, stable and easy.”

Asian Destinations Back on the Radar

The endemic move would start putting Asian destinations back on the radar of tourists both within and outside the region.

“Flight demand into Thailand has increased 53 percent (vs. December 2021) since it resumed its Test & Go program in February this year. Demand for Cambodia over the last month has risen significantly, so has that to the Maldives,” Google’s Joye shared.

Businesses like Airbnb are already witnessing a lot of enthusiasm for cross-border travel as border restrictions gradually ease in the region. “After being unable to travel abroad for so long, people are excited to take that long-awaited overseas trip, something we’ve seen reflected in searches on Airbnb following several border reopening announcements,” said Amanpreet Bajaj, Airbnb’s general manager for Southeast Asia, India, Taiwan and Hong Kong,.

Fundamental Shifts in Travel Are Here to Stay

Even as the switch to endemic indicates things going back to normal, stakeholders believe that many of the fundamental shifts in travel they saw emerge during the pandemic will stay on.

As travelers embark on cross-border trips, Bajaj expects people to take the newfound flexibility they’ve embraced as domestic travelers. Airbnb took note of some trends where they have seen the average trip length increase by about 15 percent, with stays of more than seven days being incredibly popular. “Long-term stays of at least 28 nights were also our fastest-growing category by trip length in Q4 of 2021,” Bajaj said as he pointed towards the flexibility that remote working has offered, allowing untethered workers to blur the lines between travel and living.

As Asian destinations start reopening, factors such as flight availability and comfort level for last-minute changes would be most attractive initially to travelers from within Asia rather than the West, noted McKinsey.

However, clarity and communication on requirements would continue to be the key to woo travelers.


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Tags: airbnb, asia, asian travelers, google, malaysia, mckinsey and company, philippines, singapore, thailand

Photo credit: With no or little border restrictions, Asian destinations prepare for travel recovery. tawatchai07 / Freepik

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