P10B for tourism infra to generate P35B, create jobs

THE P10 billion allocation for tourism infrastructure projects under the House of Representatives’ version of the Bayanihan To Recover As One Act (Bayanihan 2) will generate around P35 billion in economic activity for the pandemic-hit tourism sector and create thousands of jobs for its displaced workers, Deputy Speaker LRay Villafuerte said Thursday.

Contrary to claims that infrastructure should not be a priority of the roads and other tourism-related  facilities will make this sector competitive with its counterparts in the ASEAN region when economies reopen and travel is finally allowed under a post-pandemic environment, Villafuerte said.

Villafuerte thumbed down the proposal of  Tourism Congress of the Philippines President Jose Clemente III to  provide  “bailouts” or “doleouts” directly to private firms in the tourism sector as this is not allowed under the law.

Clemente’s untenable proposal was backed by Tourism Secretary Berna Puyat.

“First of all, doleouts to private firms are not allowed. These can only be done for workers, that’s why we have the TUPAD (Tulong Panghanapbuhay sa Ating Disadvantaged/Displaced Workers) of the Department of Labor and Employment, the funds for TESDA (Technical Education and Skills Development Authority (TESDA)  and the cash-for-work programs,” said Villafuerte in an interview this morning on DZRH.

House committee on good governance and public accountability chairman Jose Antonio Sy-Alvarado on Thursday said the country’s tourism industry can look forward to the long-term benefits that will be brought by the P10-billion fund allocated to the Tourism Infrastructure and Enterprise Zone Authority (TIEZA), the infrastructure arm of the Department of Tourism (DOT).

Sy-Alvarado said the fund “will unlock development in the tourism industry by boosting infrastructure and providing establishments the opportunity to work on tourist sites often neglected and lacking in facilities such as access roads, restrooms, and accommodation facilities.”

He said the House-approved version of "Bayanihan to Recover as One" or Bayanihan 2 provides the mechanisms on how tourism enterprises can avail themselves of the credit facilities through government financial institutions (GFIs).

Sy-Alvarado said the government should prioritize the development of tourism infrastructure now while there are fewer tourists in the country and when Filipinos in far-flung tourist areas need employment during the COVID-19 pandemic.

The House version of the Bayanihan 2 bill provides a P20 billion allocation for cash-for-work programs, P1 billion for the scholarship funds of TESDA, and another P100 million for the training of, and subsidies to, tourist guides.

Villafuerte said that during a meeting with tourism stakeholders, Clemente pointed out that the long-struggling industry needed financial assistance.

But when Villafuerte asked him how this can be done, Clemente could not give him an answer.

The House version of the Bayanihan To Recover As One Act--House Bill 6953-- allocates P10 billion to finance the infrastructure programs of TIEZA.

Clemente, backed by Puyat,  had proposed that the P10 billion allocation for TIEZA be diverted to provide working capital and direct funding support to the tourism sector.

Villafuerte explained that the bailout that Clemente wanted was already included in the P51 billion capital provided to government financial institutions (GFIs) under the House version of the Bayanihan 2 bill, given that neither the Department of Tourism nor TIEZA can officially lend money or grant dole outs to private firms in the tourism industry.

This P51 billion in capital infusion to GFIs such as the Land Bank of the Philippines, Development Bank of the Philippines and the Philippine Guarantee Corp. will enable these institutions to provide low-interest loans to tourism stakeholders, as well as to other sectors, such as the  badly hit transportation industry and micro, small and medium enterprises (MSMEs), he said.

Villafuerte said Clemente has claimed that the Senate version provided direct funding support to the tourism sector in the sum of P10 billion, which the House had “realigned” instead to TIEZA’s infra projects.

The lawmaker, however, made it clear that no “realignment” took place because the final version of the Bayanihan bill has not yet been approved.

Villafuerte also noted that the Senate’s P10 billion in funding support for the tourism sector was also in the form of loans and not “bailouts.”

During the interview, Villafuerte likewise  noted that every P1 spent on infrastructure will have a multiplier effect of 3.5, which means that the P10 billion for TIEZA under the House version of the Bayanihan 2 bill would pump in around P35 billion into the tourism sector and economy.

“I was sad to learn that some stakeholders in the tourism sector are saying that we do not need infrastructure at the moment. Perhaps those who are saying this are those in Cebu or in other areas with relatively good infrastructure and airports. How about the areas with poor infrastructure?” Villafuerte said.

“Other countries in the region cannot compete when it comes to the beauty of our beaches and other tourism sites. But they attract more tourists each year than the Philippines because they have better infrastructure,” he added.

Villafuerte pointed out that infrastructure investments via TIEZA would provide a big boost to the  tourism sector in the form of creating  thousands of  jobs for displaced industry workers. Villafuerte said  he expects the  bicameral conference committee on the  Bayanihan 2 bill to wrap up its meetings this week, so that the measure could be submitted to the President before the end of the month.

In a related development, Cagayan de Oro City Rep. Rufus Rodriguez urged the bicameral committee on the proposed Bayanihan 2 or We Recover as One law to realign P10 billion intended for the tourism sector.

“I am appealing to the panel to allocate the funds to the Department of Tourism (DOT) instead of the Tourism Infrastructure and Enterprise Zone Authority (TIEZA),” he said.

“What is needed is not infrastructure by TIEZA but direct assistance to stakeholders in the tourism industry directly hit by Covid-19 such as the transportation sector specially air and sea, small resorts, hotels, travel agencies, and their employees,” he said.

He said millions of employees of these establishments and small enterprises doing business with them like their suppliers have been without jobs and income since quarantine measures were imposed in March.

“It is these workers we need to give priority to in allocating public funds for the tourism sector, not to more road projects leading to faraway tourist destinations. Many of these projects do not have immediate economic impact unlike direct assistance to tourism stakeholders and their employees,” Rodriguez added.

He pointed out that the tourism industry has lost hundreds of billions of pesos due to the pandemic and reviving it will benefit more Filipinos.

The proposed P10-billion funding for the tourism sector is with the DOT under the Senate version of Bayanihan 2. However, in the House version, the money is allocated to TIEZA.

The Tourism Congress of the Philippines, which groups owners of resorts, travel agencies and other tourism-oriented businesses, is supporting the Senate version.

Other groups supporting the Senate’s Bayanihan 2 bill are the Philippine Travel Agencies Association, Philippine Tour Operators Association, Hotel Sales and Marketing Association Philippines, National Association of Independent Travel Agencies, Region One Travel Agencies Association, and the Davao Association of Tour Operators.

Among other goals, senators want the money to be used to provide soft loans and/or loan guarantees to affected establishments, including those that need to renovate or modernize their facilities, provide funds for employee retraining, marketing and promotions, and digital transformation.

Some industry stakeholders have expressed fears that if appropriated for roads and other tourism infrastructure, the funds could be used for political purposes.