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Chapter 12

Region 4B: Tourism Industry Cluster


12.1 Overview of the Industry
12.1.1 Situationer
12.1.1.1

The tourism industry in the Philippines

The tourism industry is among the sectors that have the potential to boost the Philippine
economy, if developed in a sustainable manner. This view is further emphasized in the
2010 National Tourism Strategy where the focus of the strategy for the industry is in two
areas: (1) Market-Product and (2) Destination.
Table 12.1 2010 National Tourism Strategy Focus
Strategy Area
Focus
Market-Product
Segments
Sightseeing & shopping
Mass comfort
Backpacker
Niche beach
Domestic ecotourism
Beach lover
Recreation
MICE (meetings, incentives, conventions and
exhibitions
Balikbayan
Destination
Major destinations comprising of
Cebu/Bohol/Camiguin, Palawan, Manila plus Tagaytay
and Davao as potential major destinations.
Minor destinations comprising of Vigan/Laoag and
Clark/Subic
Special interest destinations comprising of
Baguio/Banaue, and Boracay
Source: DOT

Priority actions in each set of destinations are as follows.

Major destinations- priority shall be given to major infrastructure improvement,


aggressively closing gaps, and promoting these destinations.
For special interest destinations, the priority shall be to increase accessibility, and
improve the existing tourism products being offered;
For minor destinations, the priority shall be to build more attractions, and promote
these as secondary options.

The year before in 2009, the Philippines experienced a 16.6 percent increase in tourist
arrivals in the top sixteen tourism destinations in the country, reaching close to 4 million
in the first semester of that year. The changing lifestyle and travel pattern of more
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Filipinos and Philippine residents to spend their holidays in various tourist areas in the
country contributed to the increased tourist flow.
That same year, ecotourism, bird watching, adventure and incentive tourism products
were jointly launched by the DOT, LGUs and other private sectors.
Table 12.2 Tourist Volume in the Top Sixteen Destinations, January to June 2009
Destinations
Foreign
Domestic
Total
Camarines Sur
147,504
754,698
902,202
Cebu
321,116
509,433
830,599
Boracay
112,315
271,498
383,813
Baguio*
20,677
350,528
371,205
Davao
29,691
300,556
330,247
Puerto Galera**
215,755
Bohol
45,995
114,619
160,614
Negros Occidental*
32,780
113,724
146,504
Negros Oriental
22,729
95,069
117,798
Ilocos Norte
8,088
91,659
99,747
Masbate*
10,257
71,630
81,887
Camarines Norte
1,711
79,466
81,177
Puerto Princesa
11,380
69,376
80,756
Legaspi
7,892
59,732
67,624
Catanduanes
9,953
55,188
65,141
Sorsogon*
26,251
27,951
54,203
Total
808,389
2,965,128
3,989,271
Source: DOT Regional Office
*Partial Data** No breakdown

12.1.1.2

Growth Rate
194.0%
2.3%
6.0%
-14.5%
2.7%
20.2%
15.6%
-55.2%
11.1%
6.5%
-7.5%
63.9%
63.0%
10.9%
115.0%
-14.0%
16.5%

The tourism industry in Region 4B (MIMAROPA)

MIMAROPA is one of the busiest regions in terms of tourism, cornering more than its
fair share of the total number of tourists that visit the country. The region is home to
Palawans two World Heritage Sites, the Underground River and the Tubattaha Reef as
well as Puerto Galeras tropical beauty. Tourists who are looking for a rich dose of
history and religion flock to Marinduque, the countrys Lenten capital, where the famous
Moriones festival is held every year. Divers from all over the world seek the marine
wonders of Occidental Mindoros Apo Reef. Moutain climbers will delight in exploring
the challenging terrians of Romblons Mt. Guiting-Guiting, as well as the provinces
unexplored and unspoiled beaches.
MIMAROPAs economy relies mostly on agriculture, fishing and ecotourism, making it
one of the strongest in the country. Different product focus are being done to attract the
market where the primary market focus are China, Korea, and Japan. Nationals from
these countries and in the ASEAN are emerging as the new major tourists in Southeast
Asia, in addition to the Europeans and Americans. Tourism promotion for 2010,
however, will be increased in HongKong, Taiwan, ASEAN, Australia, North America and
Europe.

12-2

Significance of tourism in Palawan


Tourism in Palawan is viewed by many of the industry players as highly significant,
primarily because of its contribution to employment and revenue generation;
employment for those directly engaged in the service industry in Palawan and revenue
generation even to nearby provinces where those in the hotel business get their supply of
some agricultural produce. In the words of DTI Regional Director for Region IV-B Joel
Valera the tourism industry in the region is rated as significant in the downstream where
it is found to be contributing significantly to transportation, employment generation, hotel
and restaurant business.
The growth rate of 63.0 percent from 2008 to 2009 (Table 1) ushered the conception of
more community-based tourism products that increased the availability of product
offering and livelihood for local residents. Notable among these community-based
tourism in Puerto Princesa are the ones being operated by the Honda Bay Boat Operators
Association, Inc, Bacungan Community Development Residents Association, Inc.
(BCDRAI)- floating restaurant tour of mangrove area in Sitio San Carlos.
Major tourist attractions in Palawan can be divided into:

Historical

Sta. Isabel Fort in Taytay Built in 1667 under the Augustinian Recollect
Fathers, this fort was used as a military station during that period. The chapel and
cannon are still intact to this day.

Cuyo Fort in Cuyo- Built during the early Spanish period to protect the people
from their enemies, this is considered as one of the most ancient and unique forts
in the Philippines.
Port Miller & Light House Tower- A historical landmark in Brookes Point, Port
Miller is a cemented water tank constructed as a source of potable water for the
natives and settlers of the municipality.
Melville Light House in Balabac A century-old facility which used to guide
ancient marine vessels landward is still glowing after a hundred years. The
Lighthouse has become a familiar landmark to the local folks.

Cultural

Batac Tribal Community- One of Palawans indigenous groups, the Bataks are
mountain people who dwell in the river valleys north of the provincial capital.
They are Negrito stock and since, only less than 500 of them thrive today, they are
considered a disappearing people.

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Natural
Calauit Island Wildlife Sanctuary in Busuanga - Its 3,700 hectare area is devoted
to a wildlife preserve of African animals from Kenya such as giraffes and elands,
zebra gazelles co-exist with endemic Philippine animals like the Palawan bearcat,
mousedeer and peacock pheasant.
Coron Reefs in Busuanga Seven enchanting lakes surrounded by craggy
limestone cliffs attract hundreds of nature lovers to the Coron Reefs. The place
offers exciting wreck explorations from enthusiasts, novice divers and snorkelers
and recreational divers.
El Nido Marine Reserve in Miniloc Island Occupying an area of 96,000
hectares, this popular nature boasts of diverse ecosystems such as rainforest,
mangroves, white sand beaches, coral reefs, and limestone cliffs. It is now one of
the countrys premier destinations. El Nido is the sanctuary for various forms of
wildlife.
Underground River in Bahile, Puerto Princesa City- A world heritage site, this
natural wonder features and 8.2 km. navigable underground river, reputed to be
the worlds longest that winds through a spectacular cave before emptying out to
the China Sea.
Honda Bay The bay consists of several islets with shallow reefs bordering
fabulous beaches which have become the favorite swimming, snorkeling, and
diving desitnations of local residents and tourists. These islets are Cowrie Island,
Bat Island, Lu-li (derived from lulubog-lilitaw, meaning floating and sinking
island that is visible only during low tide), Meara Marina, Starfish Island known
for its fine white sand clear water that teems with starfish, Snake Island- an island
with long stretch of of fine white sand shaped like a snake, Pandan Island and
Senorita Island (the breeding site of Lapu-Lapu fish).
Tubattaha Reefs National Marine Park Reputed as the countrys best dive spot.
The park was named a World Heritage Site because of its abundant marine life.
Ursula Island Game Refuge and Bird Sanctuary- This island is the heaven for
birds that converge in the island two hour before sunset to take their rest after a
days long flight.

Man-made

Irawan Crocodile Farming Institute This institute aims to preserve and further
research studies on endangered species of crocodiles.

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Iwahig Penal Farm The colony encompasses a 37 hectare scenic farm planted
with coconut palm trees, rice and other crops cultivated by the prisoners and their
families. Many of the inmates lives with their families in so-called rehabilitation
areas.

Special interest
Tabon Cave in Quezon- Known as the Cradle of Philippine Civilization Tabon
Caves consist of a series of chambers where anthropologists discovered the
remains of crude man and his tools. Anthropological significance came to the fore
with the discovery of the 22,000 year old Tabon Man in its interior decades ago,
along with other artifacts.
12.1.2 Value chain and sub-sectors
12.1.2.1

General value chain of the tourism industry

Figure 12.1 shows the value chain for eco-tourism in Palawan. This value chain is no
different from the value chain for eco-tourism in other regions.
Figure 12.1 Value Chain for Eco-Tourism in Palawan.

12.1.2.2

Support Industries

A formal tourism industry cluster, however, does not exist in the region, although in
Palawan, there are different support industries that have formed their own associations.
Some of these are shown in Table 12.4.
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Table 12.4 Travel and Tour Associations in Puerto Princesa, Palawan


Association
ATTOPP
Association of Travel and Tour Operators of Puerto Princesa
ATTSOPP
Association of Tourist Transport Services of Puerto Princesa
AROMA
Association of Restaurant Owners & Managers
ATEPP
Association of Tourism Educators of Puerto Princesa
AIRTODA
Airport Tricycle Drivers Association
HOBBAI
Honda Bay Boat Association, Inc .
Sabang Ferry Association
BCDRAI
Bacungan Community Developmetn Residents Assocation, Inc.
TASS
Tourist Association of Souvernir Shops
ATAPP
Association of Tourist Accommodation of Puerto Princesa
PATGA
Palawan Tour Guide Association
Source: Interview with the President of the City Tourism Council

12.1.2.3

Number of
Members
40
200
70
46
32
63
75-100 are active

Support Agencies/Organizations

The Provincial Tourism Office of Palawan in the Office of the Governor plays a key role
in the development of the provinces tourism potentials. Through this office, the
provincial government aggressively pursues tourism since it provides funds for projects
supportive of the industry in the province. In recognition of what the council has been
doing for tourism in the province, it received a DOT award in 2001 and 2002 as Best
Tourism Council.
Of late, however, the City Tourism Office which is under the Office of the Mayor is
selling Puerto Princesa as a separate destination for Palawan. The advantage it sees in
doing so is that Puerto Princesa alone already offers diverse attractions. There is medical
tourism where there are hot springs near Honda Bay frequented by Koreans. There is
even a Korean hot spring run by Koreans since at the present time the facilities of the
city-run hot spring are being renovated. There is the Balon Pari in Barangay Inagawan
where miraculous water is said to exist, the Honda Bay island hopping since it is
composed of 13 chartered islands/islets notable of which is Snake Island, a DENR
protected area where one can swim and snorkel with fish and the Pambato Reef.
The City Tourism Office has also developed its own tourist programs in support of the
industry like its no tree-cutting program and just rely on neighboring provinces for its
source of wood and its Strategic Environment Plan where every February 14, there is
their Love Affair with Nature Festival where people are encouraged to plant mangrove
and during the third Saturday of June, there is the Feast of the Forest, where people are
encouraged to go to balding mountains to plant trees.
A private organization that is also in the forefront in tourism activities in the city is the
City Tourism Office which is linked to several industry players.

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Figure 12.2 City Tourism in Puerto Princesa

Government
City Tourism Office

Private
City Tourism Council

AROMA

Association of Restaurant
Owners & Managers

ATTSOPP

Association of Tourist Transport


Services of Puerto Princesa

ATTOPP

Association of Travel and Tour


Operators of Puerto Princesa

ATEPP

AIRTODA

HOBBAI

Association of Tourism Educators


of Puerto Princesa

Airport Tricycle Drivers Association

Honda Bay Boat Association, Inc.

TASS

Tourist Association of Souvenir Shops

ATAPP

Association of Tourist Accommodation


of Puerto Princesa

PATGA

Palawan Tour Guide Association

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12.1.3 Demand/users and markets


Records from the City Tourism Office of Puerto Princesa show that the top ten
nationalities visiting Palawan in 2009 are the following: (1) Americans (2) Koreans (3)
Canadians (4) Japanese (5) Chinese (6) French (7) Germans (8) Australians (9)
British and (10) Swiss. There are more domestic tourists, however, than there are foreign
tourists.
Table 12.5 Tourist Arrivals in Puerto Princesa City, 2009
Month
Domestic
January
15,362
February
15,948
March
17,443
April
23,345
May
22,644
June
21,563
July
19,896
August
20,663
September
21,554
October
19,893
November
20,742
December
22,863
Total
241,916
Source: City Tourism Office, Puerto Princesa

Foreign
1,815
1,974
2,212
2,551
2,336
2,333
1,862
1,633
1,612
2,845
2,961
2,892
27,026

Total
17,177
17,922
19,655
25,896
24,980
23,896
21,758
22,296
23,166
22,738
23,703
25,755
268,942

The market is a mixture of high end tourists and backpackers. Since there are high end
tourists, like the Europeans, the need for high end facility beckons. There are more puti
or Caucasians than the other nationalities. When the Underground River, which is a
protected environment was promoted nation-wide so it can be included in the New
Wonders of Nature, however, more Filipinos and residents have also frequented the place.
Another reason for the increase in Filipino tourists is the Lakbay Aral or Study Tour
participated in by the Local Government Units ((LGU) and State University and Colleges
(SUC) where the best practices of the LGUs and SUCs are shared with others.
The peak tourist season is October/November February/March for Caucasians.
Normally, foreign tourists come to escape the cold winter months. More Filipino tourists
come during the months of April to September. There are more local tourists (70
percent) , as compared with foreign tourists (30 percent). In the Underground River
alone, around 600 tourists a day go to the Underground River, but during the peak season,
this increases to about 700 tourists a day. Since 2009, the industry which was ruined by
the Abu Sayyaf kidnapping in 2000 in Dos Palmas, has not experienced too much
seasonality in this service industry sector. There seems to be a continuous flow of
tourists, which to a great extent, is attributed to the promotional fares done by airlines and
the direct flights to the northern part of Palawan due to the newly inaugurated airport in
Coron.
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Table 12.6 shows the tourist arrivals in Palawan from 1992-2008.


Table 12.6 Tourist Arrivals in Palawan, 1992-2008
Year
Domestic
Foreign
2008
224,318
35,915
2007
181,043
43,953
2006
149,276
42,978
2005
130,531
69,865
2004
163,119
41,715
2003
108,218
34,020
2002
93,140
20,555
2001
86,708
30,808
2000
96,598
31,772
1999
80,945
38,255
1998
57,857
26,451
1997
64,361
34,251
1996
57,308
34,295
1995
19,143
42,753
1994
371
33,816
1993
17,002
8,512
1992
6,982
7,282
Source: Office of the Governor Tourism Division

Total
260,233
224,996
192,254
200,396
204,834
142,244
113,829
117,516
128,370
119,200
84,308
98,612
91,603
61,896
34,187
25,514
14,642

%Change
20%
8%
-4%
-2%
44%
25%
-3%
-8%
8%
41%
-15%
8%
48%
81%
34%
74%
-

Local tourists using boats account for 70 percent of the market while foreign tourists
account for 30 percent. The daily net income of the boat owners on the average ranges
from P500 to P1,500. During the peak months, the daily net income is P1,500.
The transport service rates are regulated by the City Tourism Office. Drivers are also
paid based on minimum wage plus commission at P250/day.
The sales volume and sales value of some of the members of the different associations are
reflected in the table below:
Table 12.7 Sales Volume and Sales Value of Different Industry Associations
Domestic Market
HOBBAI
ATAPP
TASS
Sales Volume
Sales Value
Sales Value
Sales Value
2009
2009
2009
2009
Local
363
P90,650
179,200
600,000
Foreign
155
P38,861
76,800
400,000

PATGA
Sales Value
235,200
100,800

12.1.4 Raw Materials Supply


Raw materials in this service industry, whether major or minor raw materials, used in or
by the industry itself, are usually sourced internally or within the province and the region.
Raw materials that are sourced outside the region include the hotels and restaurants
reliance on Bacolod and Iloilo for their chicken and Manila for Baguio vegetables.
Furniture, furnishings and toiletry are also sourced within the province.
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Bancas and materials used to make them come from within the province. This is true also
for gasoline, life vests and crude oil.
None of the members of the different associations bulk-buy their raw materials so they
could save on cost. Rather, raw materials are sourced individually. Though the ATAPP
members are not into bulk buying of raw materials, they, however, share plumbers and
other maintenance crew.
12.1.5 Productivity
Productivity of the tourism industry in MIMAROPA, specifically in Palawan, is
comparable to identical industries in the country. Trainings are regularly conducted for
boatmen, tour guides by the City Tourism Office and the City Tourism Council.
In hotels, specifically, the Legend, there is the practice of keeping its personnel to a
minimum and once there is a need for more, like when there are conventions, then
additional personnel are supplied by an agency. This way, it is ensured that the
productivity of its staff is maintained at the highest level.
12.1.6 Price Competitiveness
The price of industry players are generally at par with similar industries outside the
region. Rates for transport services are shown in the table below:
Table 12.8 Transport Service and Driver Rates in Palawan
Tour Trail
Transport Service
Underground River
3,500
City Tour
1,500
Honda Bay
1,500
Roxas
4,000

Driver Rate
700
300
300
1,000

In the hotel business, accommodation is in fact even lower compared with other regions.
Transport service rate for vans, tricycle and boats, are comparable with those outside the
region. Prices in fact are regulated by the City Tourism Office.
12.2 Potentials and Issues in View of Cluster Development
12.2.1 General issues
12.2.1.1

Competitive Advantage

All the industry players interviewed mentioned as a competitive advantage nature and
biodiversity. There are 1,700+ islands and each island offer a different type of fun and
excitement. Natural park, idyllic beaches, lagoons, caves, eco-tourism, varied packages
or products like dolphin watching, fireflies watching, island hopping, diving, snorkeling,
among others.
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Another competitive advantage frequently mentioned is the Underground River which is


a world heritage site and an entry to the New Wonders of the World in 2011 and the
Tubattaha Reef.
Given all the natural endowments, and being known as the Philippines last ecological
frontier, the strong support of the City Government of Puerto Princesa as well as NGOs
in Palawan like the ABS-CBN Bayan Foundation and the Environmental Legal
Assistance Center (ELAC) and the Palawan Network of NGOs, Inc. (PNNI) complete the
competitive advantage of Palawan.
12.2.2 Technology
Depending on the industry players, the degree of the state of technology varies from
manual to mechanized.
Table 12.9 State of Technology in Associations

State
Manual
Mechanized
Others

TASS
(souvenir
shops)
90%
10%

HOBBAI
(boat)
100%

ATTSOPP
(transport)
100%

Associations
ATAPP
(accommodation)
40%
60%

ATTOPP
(travel
operators
40%
60%

AROMA
(restaurants)
70%
30%

Technological development that has helped the industry a lot revolve around information
and communication technology. Thus, the connection to the internet where the players
can be connected to the rest of the world is viewed by many as the most important
technological development. Others, like the boat associations and the transport
association consider the cell phone as a very potent, especially considering that landline
connection is not that reliable in certain municipalities in Palawan.
12.2.3 Marketing and distribution
Marketing is generally done through the internet if the members of the different
associations have their websites as in the case of accommodations/hotels. For big hotels,
like the Legend, there is even the Sales Blitz in the USA and London for balikbayans
where the top brass of the hotel visit travel agencies abroad and host dinner or lunch for
tourist associations of Filipinos staying abroad. Advertising through the newspapers is
also resorted to. Others rely on the assistance they get from the City Tourism Council
which they are a member of. The Council refers the accommodations/inns to the LGU
(for Lakbay Aral) and includes them also in the annual expositions and exhibits
conducted by the Council. During these exhibits, the ATTAPP members promote their
services to the crowd.
In the case of boat operators, they are allowed to display their brochures in places (hotels,
inns, restaurants, etc) where they have tie up with.
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For its part, the City Tourism Office (CTO) participates in media blitz and Travel Mart
Caravan to promote tourism in the Puerto Princesa City. The Office also participates in
the annual convention of tourism officers of the Philippines. Recently and with the
attention given to the Underground River to be included in the Seven New Wonders of
Nature, the head of the office even went to Marawi City to promote the on-line voting.
The Mayor also makes TV appearances and during these TV appearances, makes a pitch
for Puerto Princesa. It is also a common practice of the Mayor to tender dinner or lunch
with cultural show afterwards where tribal songs and dances are commonly featured.
Before renewal of license of business permit, Gabay sa Turismo van drivers can not drive
without a training certificate issued by the CTO.
12.2.4 Financing facilities
Commercial banks proliferate in the region and have windows for the industry. For
example, one key player availed of the Land Banks Sulong Turismo that has an easy loan
for working capital and construction of building payable in 1-2 years.
Many of the small industry players, however, prefer to conduct business with smaller
banks and NGOs that give financing.
The Honda Bay Boat Owners Association, Inc. sources for financing include the
Palawan NGO Network, Inc. (PNNI) which give P50,000 per association; the ABS-CBN
Bayan Foundation which gives P50,000 per individual; the National Confederation of
Credit Cooperatives P100,000 per individual and the Greenbank which gives P30,000P50,000 per individual.
In turn, HOBBAI, provides microloans of P5,000 to P20,000 to members. Payment is
daily collected for every trip made by the boat until the loan has been fully paid.
The common use for the borrowed funds is for working capital. The different associations
and the use of their borrowed funds are shown in the table below:
Table 12.10 Associations and Use of Borrowed Funds
Associations and Use of Borrowed Funds
Financing
TASS
HOBBAI
ATTSOPP
ATAPP
Facilities

Working

capital

CTC

12.2.5 Skilled labor development


Adequate labor supply for the tourism industry in the province is available and does not
pose any problem should there be resignations except for the hotel business where regular
employees are kept to a minimum. There are times when there is again need for the
services of personnel they have trained and laid off temporarily (during conventions),
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some of them have already gone abroad . In cases like, additional personnel are taken
from an agency and training is done again. Save for this, for the rest of the industry
players, appropriate supply of labor is adequate all-year round.
Skilled personnel required include tour guides (who are licensed and certified by the City
Tourism Office), van drivers, diesel mechanics of boats, hotel frontliners and sewers for
the souvenir item makers. Included among the semi-skilled personnel are the boat
captain, the crew, and finisher of souvenir items.
Skills development programs are regularly held and the industry players avail of these
programs for their personnel. These programs and providers are shown in the table
below:
Table 12.11 Programs and Skills Providers
Program
Tour Guiding Technique
Mabuhay Hosting Technique
Guest Management
Mock Tour Training
Trekking/Snorkeling
Handling Complaints
Customer Service Training
Maintaining Boats
Dyeing Techniques
Leadership, Bookkeeping, Business Management,
Life-saving techniques
Coral Management
First Aid
Housekeeping, Waitering, Restaurant Management

Provider
City Tourism Office

Hotels central agency in Manila


Palawan State University
City Tourism Council
DOST
Environmental Legal Assistance Center (ELAC)
AGS-CBN Bayan Foundation
Red Cross
TESDA

12.2.6 Infrastructure
From interviews with different industry players, the following were viewed as concerns
as far as infrastructure is concerned:
Electricity
A big problem facing the industry is the adequate supply of electricity. The province is
experiencing power outages and this is not good for tourists and business although most
of the hotels and restaurant have generators. Neither do all the municipalities have 24
hours of electricity service, even the tourist sites. There are plans, however, of putting up
solar windmills in Sabang.
Pier
With the construction of the PNP Maritime built in the Honda Bay area, the area where
boats could be berthed has become limited and narrower. The PNP doesnt want the
boats used for tourism to be in front of the Maritime, and because of this only a small
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number of boats could be berthed in the area. Owners have to berth their boats elsewhere
in the bay area.
Airport
There is a need to expand the airport and make it an international airport to assure
continuous influx of foreign tourists. Tourists do not like the hassle of stopping in Manila
just to get a flight for Palawan. Likewise, there is a need to have a direct ferrying of
tourists from Puerto Princesa to Coron. An international airport, though, is set to be
constructed in 2010.
Roads and Bridges
The concreting of roads aside from the national highway is a major concern. The Puerto
Pincesa City road network (which include Sabang) to El Nido has to be improved. In
going to El Nido, tourists experience only two hours of good roads and then another four
hours of dirt road. As such, tourists have to travel more than six hours from Puerto
Pincesa to El Nido because of bad road condition.
Since there are narrow roads which cant be extended anymore, the government is now
looking for possible alternate roads.
Water
During the summer months, NAWASA water is not sufficient.
Telecommunication
This is viewed as not adequate since not all municipalities have access to internet.
12.2.7 Other issues
ATAPP (tourist accommodation) is advertised through the internet and as member of the
City Tourism Council, members are referred to visitors of the LGU. ATAPP members
are likewise included in the annual expos and exhibits to promote its services. The view
of some, however, is that since some officers of the Council also own hotels and
accommodation, it is but natural that preference is given to their hotels and inns. This
leaves those who are not officers to fend for themselves.
ATTSOPP (tourist transport services) considers competition as a problem. It feels that
there must be a covenant so prices will be standard. There are many fly by night
operators especially of vans used by tourists. What must be done is to monitor and report
problems to the city administrator and legal.

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The problem of the HOBBAI , which was formed as an association in 1997, is the land
where the boat owners are residing since it is owned by the city government and the City
Mayor calls it a city reserve and does not want to give it to the community. In 1998,
Honda Bay was declared by the City Government as a Tourism Zone and allowed only 83
out of 300 families to settle in said area. To this date, the fate of these residents is still on
hold and that includes the boat operators of HOBBAI. What is feared is a relocation site
that is far from the wharf. This will be a problem since it will be hard for the owners to
safeguard their boats.
The City Government of Puerto Princesa should already decide which part of the Honda
Bay area will be the residential portion for the boat operators. This is the uncertainty
being faced by the boat operators/owners.
The community has already gone to the Philippine Congress so that the land could be
given to them. This was endorsed by the provincial government but the endorsement of
the city government is needed and naturally, this was not given to them. Their stay,
therefore in the area is precarious since if they will be located outside of the Honda Bay,
it will be expensive for them to travel to Honda Bay for their business. Another problem
is the PNP Maritime Office which was built when some of the homeowners were
transferred. The presence of the PNP Maritime in the area has diminished the bay area
where their boats could be berthed. The Mayor has asked HOBBAI members to look for
an area where the boat owners could transfer residence with the site being paid for by the
city government. The available land seen as a possible relocation area is in the mountain,
far from their source of livelihood.
Another problem of the HOBBAI members is the upgrading and maintenance of their
boat. The life span of a boat which if big, costs around P300,000 and if small costs
around P150,000 is just five years. Much as they would like to earn as much as they
could during the life span of their boats, they cant dictate prices without the ordinance
coming from the City Government. They have to lobby to the city government. They
were able to increase their rates twice already but this was done through an ordinance
issued by the city government.
The City Tourism Council yearly trains their boatmen as well as the boat owners on how
to maintain their boats.
The Palawan Tour Guide Association (PTGA) was registered with the SEC in 1992. It
has 100 members but only 75 are active. Seventy percent of the members are full time
tour guide operators while 30 percent are part-timers. Several benefits accrue to the
members of the association. PTGA acts as a support group in case of problems; (2)
PTGA lobbies for its members and serves as a voice of the industry; (3) members can use
the boats (bancas) owned by the association, which came from a P65,000 grant given by
the DOT, and supported by counterpart funds of the association in the amount of
P100,000; and (4) earnings from the dolphin watching is equally divided among
members.

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Members pay an annual fee of P500 and a monthly fee of P100. Each tour guide pays
P3,00 for the renewal of license.
Unfortunately, PTGA is confronted with several problems.

The association is not generating income right now.


The association, it turns out, is not allowed to own a boat and operate it for tourism
purposes. The action is to put the boat under the Presidents name in the meantime.
Third, there is an absence of a clearing house for tour guides.
The City Tourism Office is in direct competition with the private sector; some of the
CTOs staff own tourist agencies, restaurants, vans, and hotels. And they have their
own tour guides. If there are sectoral meetings, tour guides are not invited.
Competition is cutthroat and the CTO is unable to address this problem.
There is a lack of agreed rates among tour guides. For example: if a guide is
servicing two vans, the tour operator normally should pay him on a per van basis
which is P1,000 per van. The tour guide could lower his or her rate so that next time
he or she can have a repeat service.

The anticipated growth in international visitor arrivals and domestic travel movements is
expected to bring about a corresponding increase in capacity requirements and demand
for new products, facilities and services, thus paving the way for local and foreign
investment opportunities. In line with this is the improvement and upgrading of quality,
skills and competencies of the required frontliners.
Hotels, resorts and other types of accommodation facilities especially in the regions will
have to be built to address the lodging requirements of both foreign and domestic tourists.
The need for improved accessibility will likewise open investment opportunities in air,
water and land transport operations. In response to worldwide demand for integrated
tourism development, the Department of Tourism (DOT) likewise encourages
investments in tourism estates and ecozones, historico-cultural heritage projects, as well
as ecotourism, agritourism, and health and wellness projects
12.3 Cluster Structure
12.3.1 Lead government agencies
The City Government of Puerto Princesa is very actively promoting tourism and the
support it has given the industry in all aspects overshadows the activities being done by
other agencies. The Department of Trade and Industry, for instance, is viewed by TASS
as not considering tourism as a priority though it gives booth subsidy during fairs and
exhibits,
12.3.2 Relevant industry/trade associations
In Palawan, the Provincial Tourism Council and the City Tourism Office are both active
in the City Tourism Council, a private sector organization.
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The members of the City Tourism Council are: (1) AROMA, (2) TASS, (3) AIRTODA,
(4) ATSOPP, (5) HOBBAI, (6) Sabang Seafarers, (7) Association of Pearl Vendors, (8)
Palawan Association of Tour Guides, (9) Tour Guide Association of Puerto Princesa, and
(10) Association of Tourism Educators of Puerto Princesa.
Members of the Association of Pearl Vendors are given tourism awareness seminars,
provided with appropriate IDs, and regulated by the City Tourism Office. They are also
required to secure/renew their business permits yearly.
The Association of Tourism Educators of Puerto Princesa includes schools offering
tourism, HRM, and related courses. Active members are the Palawan State University
(PSU), Western Philippine University (WPU), Holy Trinity, and Palawan Technical
College.
12.3.3 Support from research institutes/universities
The Holy Trinity College in Puerto Princesa, a private school established in 1940, is one
of the first schools to offer the course on Hotel and Restaurant Management. In the
public schools, the Palawan State University is also one of the first to recognize the
importance of HRM in the tourism industry and also offered it as a course. Being a
private school, Holy Trinity HRM course costs P10,000 to P12,000 per semester while at
PSU, the cost is only approximately P1,500.
Holy Trinity started offering HRM in 1995 and there are now approximately 300 HRM
graduates. No tracer study has been done on its graduates although the head of the HRM
department says that based on talks with former students, there are some 60 percent who
are employed in related fields. At Holy Trinity, most students have part time jobs in
tourism-related fields. The curriculum includes practicum for the students and this is
conducted in hotels. There is a Memorandum of Agreement with hotels regarding the
practicum where the students work in the hotel for the duration of the practicum and they
are given free meals by the hotel for the service rendered. Some hotels, though, even
give the students daily allowances.
Besides the formal course in HRM, Holy Trinity also has extension service the Tulay sa
Kabataan, where Out of School Youths are trained in hotel servicing and housekeeping.
Being an extension service of the school, this is for free and a batch in a year graduates
35-40 out of school youths. The criteria used by the school in choosing those who will be
enrolled are the following: income level, OSY, high school level, geographic area
representation and pleasing personality.
This year, its culinary school is to be opened in Tinigaban with 150 rooms.

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The Western Philippine University for its part, taught the boatmen of the HOBBAI on
how to be frontliners. The boatmen were taught on the importance of the corals and
marine life so that in turn they could forewarn tourists to also treat nature and marine life
with respect.
In turn, the Palawan State University conducts psychological examination for tourist
guide applicants in the City Tourism Office. Last year, out of 152 applicants for tour
guides in the seminar conducted, only 50 were taken to undergo training.
Other academic institutions that have limited collaboration with the industry are the
Palawan Technology College, Inc., Palawan Hope Christian School, and TESDA which
used to offer skills training for the hotels and restaurants in Palawan. There are no
consultancy services, laboratory facilities or testing facilities to speak of, however.
12.4 Development Policies and Activities
12.4.1

Expectations for cluster development, existing support programs and


aggressiveness towards the cluster approach
12.4.1.1 Lead government agencies

The Department of Tourism allows the City Tourism Office under the Office of the
Mayor to issue license to tour guides, renewable every year for a fee. The fee collected, in
turn, is being used to upgrade the skills of the other stakeholders in the industry.
Programs being implemented by the City Government of PPC include the following:
Travel and Tour Expo- Palawan
Travel and Tour Expo Cebu
Travel and Tour Expo- Manila
12.4.1.2 Local government units
The Annual Investment Program CY 2010 of the Province of Palawan spells out the
support programs it is doing for the industry.
The specific objectives of these programs are as follows.

To promote the province as a tourist destination and investment area


To increase tourist arrivals, length of stay an spending
To accelerate the development of infrastructure support in identified tourism hubs
To construct and/or rehabilitate roads and bridges leading to existing and target tourist
destinations and attractions to make transport of visitors by land faster and more
convenient

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To provide the enabling environment to further attract and expand private sector
investments, especially in the identified tourism hubs and in potential tourism
destinations.
To develop affordable tour packages and programs that will link tourism hubs with
their local destinations/attractions as well as provide a diverse mix of products for the
enjoyment of tourists
To develop the human resource to respond to the ever-changing needs of tourism
industry
To advocate a culture of tourism through information campaigns
To showcase the ingenuity and entrepreneurship of the Palawenos and continually
provide alternative livelihood and employment to host residents through communitybased tourism.

Other economic services provided by the provincial government in support of the


industry are the following.

To improve transportation linkages between and among municipalities province


wide and enhance linkages with major urban centers outside of the province.
To rehabilitate at least 2 percent of existing provincial roads and bridges
To increase road density of the province form 0.387 to 0.372 kilometer per square
kilometer
To upgrade at least 4 municipal port facilities province wide
To construct and/or upgrade other government ports and boat landings in strategic
areas
To upgrade at least 4 terminal sea port facilities in the province
To upgrade at least 2 airport facilities in the province
To establish and/or construct at least 1 airport in Northern Palawan and 1 in
Southern Palawan.

The City Tourism Council of Puerto Princesa, on the other hand, conducts two-day
enhancement seminars for tour guides. A budget of P100,000 coming from the city
government is appropriated for this. Likewise, the office is active in recognizing the
PATGA and links it with other tourism associations in Puerto Princesa.
Programs in support of the industry being implemented by the provincial government
include the following: Travelmart ( a national gathering of those in business) where the
provincial government share its booths with tourism stakeholders who are encouraged to
put on display their brochures and flyers.
Specific projects being implemented and/or planned by the Local Government Units are
the following:
Table 12.12 LGU Projects
LGU
City Government of Puerto Princesa and the
Philippine National Police

Programs Implemented
Scubasurero Program (2009) a clean up drive of
the waters and corals.

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City Government of Puerto Princesa

Enhanced Integrated Tourism Program

Also, the city government of Puerto Princesa through its CTO has five projects with ABS
CBN Foundation. These are the Fireflies watching in Inagawan, Ugong Rock tour for
spelunking, River cruise in Bacungan, Pambato Reef and Dolphin Watching. In the latter
project there are four boats,( 1 ABS CBN, 1 DOT, and 2 private-owned). The City
Government bears some expenses as counterpart while ABS CBN is in charge of
promotion. This is in line with ABS-CBNs Bayan in Juan project where local community
people are trained as community guides.
Another project of the city government through the City Tourism Council is in opening a
Batas Center. Batas is a native tribe. This project involves putting on display cultural
items made by the tribe. Besides putting them on display, there will be an activity center
that can be shown to tourists. The tourists can even try their hands in doing some of the
items. Cultural presentations will also be regularly shown.
Through Ordinance 171, which is the tourism code of Puerto Princesa, not just anybody
could put up a travel agency. Requirements are spelled out in the code. Tour guides are
licensed, standards for hotels and accommodations have to be maintained and grounds for
penalties for violators are identified. The city government is ISO-certified since three
years ago.
12.4.1.3 Industry associations
Table 12.13 summarizes the policies/support programs/interventions/projects being
implemented and/or planned by industry/trade associations.
Table 12.13 Interventions of Industry/Trade Associations
Industry/Trade Association
Programs Implemented
HOBBAI
Joint project to eliminate starfish- crown of thorns
which are disastrous to corals.
Palawan Geographic Society (members are divers)
Coordinate diving tours with them.
Association of Tourist Accommodation of Puerto
Pooling together of manpower (plumbers,
Princesa
handyman); lobby with the mayor when there are
problems with travel and tour operators; airport
billboard information are provided to tourists at the
airport; conflict resolution; promotion of members
during expos and fairs.
City Tourism Council
Training of boatmen and boat owners on the
maintenance of boats.

There are two boat associations in province. These are the HOBBAI, and the Sabang
Ferry Association. HOBBAI looks with pride its recognition by the Puerto Princesa City
Government as the only authorized association to ferry tourists in the Honda Bay Area.
HOBBAI is linked to tour operators, which means that the Honda Bay area becomes a
part of tour itinerary. Because of this, boat operators are doing their best to protect the
environment. In this regard, the boat operators even hire personnel to watch over the
coral sanctuary so that they could be protected from possible damage and harm that could
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be done by tourists. The boatmen and operators are also trained to impress on the tourists
the importance of not touching the corals or taking from their natural environment.
Among the future plans of the HOBBAI is to put up a TV in the waiting area for the boat
ride and show some informational materials on TV on how corals live, and how they
could be protected. This was then a plan of the ABS-CBN Bayan Foundation but for
some reason, this did not materialize. The association is however, bent on pursuing this
plan.
Aside from the plan previously mentioned, the association plans to continue and even
pursue with much vigor its business where it has invested in mask and snorkeling
equipment for rental of divers.
Interviewees
1. Felisa Torres, president, City Tourism Council ; owner- Bulwagang Princesa Tourist
Inn and Restaurant, 04 February 2010
2. Joel Valera, regional director, DTI Region IV-B MIMAROPA, 28 January 2010
3. Myrna Rosco, president, HOBBAI, 03 February 2010
4. Christian Cuvinar, van owner: Gabay sa Turismo sa Palawan, Member, Association
of Transport Service Operators of Puerto Princesa (ATSOPP), 05 February 2010
5. Normie Moreno, boat owner/operator and Vice-President, HOBBAI, 03 February
2010
6. Ligaya Austria, owner, Lola Itang Restaurant and Pension Inn; president, Association
of Tourist Accommodation of Puerto Princesa, 05 February 2010
7. Pacifico Lumauag, owner/manager, Island Paradise Tours and Convention, 2009
President, Palawan Chamber of Commerce and Industry, 04 February 2010
8. Eva Valledor, owner/manager Binuatan Creations; president, Tourist Association of
Souvenir Shops, 02 February 2010
9. Mida Mahilom, head, Hotel and Restaurant Management Department, Holy Trinity
College, 05 February 2010
10. Janrex Lorilla, licensed tour guide and president, Tour Guide Operators of Puerto
Princesa, 05 February 2010
11. Corazon Timones, city tourism officer, City Tourism Office, City Hall, Puerto
Princesa City, 04 February 2010
12. Maribel Bui, chief tourism officer, Provincial Tourism Office, Palawan, 01 February
2010
13. Melanie Mariano, hotel property manager, Legend Hotel, 04 February 2010
14. Rosenda Fortunado, provincial director, Department of Trade and Industry Palawan,
02 February 2010
15. Ada Mae Jayme, trade and industry specialist, Department of Trade and Industry
Palawan, 02 February 2010
16. Oscar M. Agbay, provincial director, Oriental Mindoro, Department of Trade and
Industry Oriental Mindoro, 28 January 2010

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References
1.
2.
3.
4.
5.
6.

Provincial Planning Development Office, Annual Investment Program, CY 2010


City Tourism Office, Puerto Princesa
Provincial Development Investment Program, 2009-2014
www.dot.gov.ph
www.visitmyphilippines.com
www.wowphilippines.com.ph

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