The Philippines’ tourism sector could grow faster and more inclusively if long-standing infrastructure gaps are addressed, according to an analysis by the ASEAN+3 Macroeconomic Research Office.

Despite global recognition as a top destination, the country has yet to fully convert its natural and cultural appeal into stronger international visitor growth. “While domestic tourism continues to anchor overall demand, the rebound in international visitors has been slower than expected,” the report said.

The Philippines recently won multiple honors at the World Travel Awards Asia and Oceania Gala 2025, including Asia’s Leading Beach, Dive, and Island Destination. Key sites such as Boracay and the Clark Freeport Zone also received recognition, while the Department of Tourism was named Asia’s Leading Tourist Board. Tripzilla has also awarded the Philippines as the Asia's Best Retirement Destination at the 11th TripZilla Excellence Awards

Still, international arrivals remain below pre-pandemic levels. In 2024, foreign visitors reached 5.9 million—about 28 percent lower than before COVID-19—dragged in part by the slow return of Chinese tourists. Compared with regional peers, the country continues to lag behind destinations such as Indonesia, Malaysia, Thailand, and Singapore.

Tourism activity is also heavily concentrated, with the National Capital Region and Central Visayas accounting for over 60 percent of foreign overnight stays, leaving many destinations underdeveloped or difficult to access.

AMRO said unlocking the sector’s full potential will require major investments in both hard and soft infrastructure. Transport connectivity remains a key constraint, with upgrades needed in airports, seaports, and road networks to improve access across islands and spread visitor traffic more evenly.

Basic utilities such as water, sanitation, electricity, and waste management must also be improved, particularly in eco-tourism areas where sustainability and carrying capacity are critical.

The report also highlighted the need to strengthen digital infrastructure, including broadband access and integrated booking and payment systems, alongside better visitor facilities such as convention centers and information hubs.

Beyond physical upgrades, AMRO emphasized improving service quality and workforce skills. Expanding training for tourism workers, enhancing coordination among agencies, and sustaining reforms in zoning, environmental management, and safety standards were cited as priorities.

Tourism remains a key pillar of the economy. In 2024, the sector generated P3.5 trillion in gross value added, accounting for 13.2 percent of GDP and supporting nearly 4.9 million jobs.

AMRO noted that tourism-related industries can generate higher domestic value-added compared to many other sectors, underscoring the industry’s potential to drive broader economic recovery—provided structural bottlenecks are addressed.