According to October 2010 statistics, there has been an estimated 30 percent increase in the number of Singaporeans visiting the U.S. compared to a year ago, surpassing the decline in 2009. Figures are now back on the rise, paralleling a strong recovery from the global economic crisis that precipitated a 24 percent decrease in the number of Singaporeans visiting the U.S. in 2009. Industry figures estimated nearly 140,000 Singaporean travelers to the United States in 2010. A record breaking US$70 million in sales at the recent B2C NATAS travel fair further reflects industry growth.
These numbers correspond with Singapore’s 14.7 percent growth in 2010 - the second largest increase in the world and largest among industrialized economies. With a modern economy and a GDP per capita of US$43,867 in 2010, Singapore ranks in the top 20 and top 50 for overall tourism expenditures and inbound tourists to the U.S. respectively.
Due to its small size, domestic tourism is virtually nonexistent in Singapore. This deficiency, paired with a high standard of living, promotes a culture that enjoys overseas travel. As such, competition for the Singaporean tourists’ dollar is strong. Although the U.S. is an attractive destination for the Singaporean traveler, it must compete with traditional tourist streams to Europe, in addition to the affordability of Asian destinations as a result of flourishing low-cost regional airlines.
Despite its small size and a population of 5.1 million people, Singapore was the 13th largest trading partner and 10th largest export market for the United States in 2010. American firms generally find Singapore conducive to business, with many utilizing the island city-state as a gateway to the region. There are slightly more than 1,500 U.S. firms (which is around a fifth of all the MNCs) in Singapore, many of which have located their Asia Pacific headquarters here.
The Government of Singapore (GOS) reports that its citizens are traveling overseas more frequently. Higher disposable income and an increase in work-related travel have provided Singaporeans with a greater opportunity to travel. Outbound travel from Singapore has grown steadily since 2000 from four million departures by sea, air or land to slightly more than seven million in 2010. Since Singapore is a small island with numerous air connections, air travel accounts for most of the departures. According to recent statistics, more than three million Singapore residents aged 15 years and above made at least one trip overseas annually in the past two years.
Singapore maintains frequent and numerous connections with Asian and European countries as well as direct air connections to the United States. However, like most trade dependent economies, Singapore experienced the effects of the global economic downturn and overall growth was negative in 2009. Nevertheless, 2010 growth was solid at more than 14 percent and prospects are optimistic for 2011 as the highly resilient economy moves forward.
The U.S. did not make it in the top 10 destinations for Singaporeans in 2009, but it came in 8th for popular destinations in 2010 (top five: Japan, China, Europe, Taiwan and Korea). The average length of stay in the U.S. is more than 2 weeks and most Singaporeans generally visit one or two U.S. States during their trip. Singaporeans tend to visit either the west coast or the east coast. Consequently, popular destinations include Los Angeles, San Francisco and New York City in that order. Orlando and Las Vegas are also popular cities due to their mega tourist attractions.
Singapore’s Immigration & Checkpoint Authority started using the new biometric passport system in 2007 that relies on fingerprint technology. The system will help ensure that Singapore continues to participate in the U.S. Visa Waiver Program, which will enable Singaporeans to travel to the U.S. with convenience. Singaporeans will not need visas to enter the U.S. in most circumstances; however, travelers on extended business, employment and education trips will require a visa.
As of January 2009, the Electronic System for Travel Authorization (ESTA) is the new online initiative under the Visa Waiver Program (VWP) – see https://esta.cbp.dhs.gov for more info. All nationals or citizens of VWP countries who plan to travel to the United States for temporary business or pleasure under the VWP will need to receive an electronic travel authorization prior to boarding a U.S.-bound airplane or cruise ship. On September 8, 2010 a fee of US$14 was implemented for all visa waiver countries and valid for two years. Fees are collected when Singaporeans going on holiday or business meetings obtain clearance ahead of their journey through ESTA. Part of these fees will go towards the funding of the Corporation for Travel Promotion (CTP) that was set up in 2010 to function like a national tourism organization.
The internet has transformed the travel industry, especially in a highly wired country like Singapore. The ease of online booking allows for a much more organized process of planning and booking. Based on industry estimates of 2009 travel, 40 percent of bookings were completed online after office hours or at night when traditional travel agents are closed. This is up from 35 percent in 2008. It seems that less people are going to travel agencies (unless for pre-paid travel packages which are still highly popular) while the percentage of individuals who go directly to the airlines seems unchanged.
In 2010, approximately 140,000 Singaporeans visited the U.S., an increase of 30 percent over the previous year. This places Singapore among the 50 top markets for inbound tourists. The U.S. - Singapore Free Trade Agreement and the visa waiver program are the major drivers behind such figures, along with the weakening of the U.S. dollar against the Singapore dollar. As of March, 2011 the exchange rate was approximately S$1.25 to US$1. Similarly, receipts from Singaporean tourists in the U.S. peaked at US$552 million in 2008. However, in 2009, the number of Singaporeans who visited the United States fell to 107,000 and as such, the receipts also dropped to just over US$382 million.
As Singaporeans sought to survive the hard times, work was increasingly given a higher priority over leisure due a difficult job market. As a result, more embarked on multiple short holiday getaways throughout the year, instead of taking a few longer trips. This meant more intra-Asian travel rather than long haul trips to the U.S. and Europe. However, consumer confidence is on the rise and Singaporeans are undeterred by the higher cost in travel packages and air tickets. At the recent NATAS fair in February 2011, more than US$70 million worth of travel deals were snapped up by 65,000 visitors which was an increase from last year.
The proliferation of low-cost or budget airlines has also affected Singapore’s travel industry. Tourists may now think twice about long haul travel to the U.S. and Europe since air fares to nearby countries like Thailand, Vietnam, India and China have dropped considerably. Even Australian cities have been added as destinations for these budget airlines. As such, the major airlines with loyalty mileage programs are going the extra mile for frequent fliers. These airlines are reserving more choice seats, providing faster check in and giving preferential treatment in the event of delays for their best customers.