Global Tourism Sector Approaching Full Recovery
The global tourism sector is approaching a full recovery to pre-pandemic levels, but some demand for travel could taper off. Still, there are some bright spots in tourism as certain themes could take hold this year.
The latest tourism data from United Nations agency UN Tourism, titled World Tourism Barometer, indicated that tourist arrival numbers in most regions have already surpassed those of 2019 – the year before the Covid pandemic when travel was shut down.
About 1.1 billion people travelled internationally over the first nine months of 2024, up 11 per cent from the same period in 2023; the number also represents 98 per cent of pre-pandemic levels of international travel, the UN indicated. Visitor spending is estimated to have outpaced arrivals on the back of longer periods of stay and higher average spending per trip.
“International tourism receipts have seen extraordinary growth following an already strong 2023, surpassing pre-pandemic levels in most destinations,” said the UN. Still, air travel demand is expected to come down from post-Covid highs.
Travel Retail
Siddharth Pathak, Kearney senior partner and head of consumer industries and retail for Asia-Pacific, said continued global inflation against the backdrop of an economic slowdown has created a drag on overall travel retail spending worldwide. However, with the steady rise in air-transport figures since the lifting of Covid-19 restrictions, the travel retail space has room to grow.
The appeal of duty-free shopping is being overshadowed by travellers’ ease of access to merchandise in domestic markets and on multiple e-commerce platforms, which Pathak said is often priced attractively.
He noted that recent per-passenger spending on retail travel is down 8 per cent from 2019 levels, and more than 30 per cent lower than the “revenge-buying highs” of 2022.
He therefore expects retailers to ramp up their omni-channel strategies in their bid to close this gap from 2025 and beyond.
To shape demand and serve it through multiple engagement platforms – ranging from digital ones to physical stores at airports – Pathak said businesses will have to start engaging travellers earlier, while they are still planning their trips.
Diversifying Accommodation Options
Wong Kar Ling, chief strategy officer and managing director for South-east Asia of The Ascott Limited, believes 2025 will be a year of “renewed traveller expectations” of a wider variety of – and more flexible – accommodation types.
For instance, the business-leisure or “bleisure” market demands multi-generational and wellness options as travellers want holistic travel, and Gen-Z travellers prioritise spending on authentic experiences, she noted.
“Against this backdrop, travellers will look at accommodation options as more than just a room or an apartment to rest their heads. In a culturally diverse region such as South-east Asia, travellers will seek out spaces that closely align with their lifestyle needs,” she added.
Eco-Tourism
Responsible and sustainable travel has also become a necessity rather than a trend, especially in recent years.
An open-access study published in December 2024 by peer-reviewed journal Nature Communications found that the global tourism sector’s carbon dioxide emissions rose by 1.5 gigatonnes between 2009 and 2019 – the equivalent of the annual emissions produced by all of Latin America and the Caribbean.
At 3.5 per cent a year, the expansion rate of tourism’s carbon footprint during this period was also found to be twice that of the global economy (1.5 per cent a year), highlighting an “impossible emissions challenge” in the face of accelerating tourism demand.
That said, Ascott’s Wong believes modern travellers prioritise eco-friendly practices.
Medical Tourism
Dr Kok Wai Leong, senior consultant for dermatology at HMI Medical Centre, believes Singapore will remain an attractive option for medical tourists, even as its regional peers catch up in terms of quality care and scope of services.
Given the city-state’s reputation as an established healthcare hub in the region, medical tourists continue to be drawn to it when they want complex medical procedures and treatments requiring specialised skills or expertise, he said.
Dermatology is one area pulling in such tourists.
Dr Kok noted a growing demand for clinic-based procedures – particularly for aesthetic concerns or day surgery, such as for the removal of skin growths.
Non-invasive procedures for skin rejuvenation are poised for growth in 2025, he said, given that such in-clinic treatments promise a short downtime as well as quicker recovery than in-patient surgery.
The senior consultant has also observed more enquiries from patients seeking treatment for conditions such as skin cancer, and a rising preference for skin cancer surgery in a day-surgery setting because that costs less and offers faster turnaround time.
Conclusion
As the global tourism sector approaches a full recovery to pre
