MARKETS - Singapore makes the grade

TTGasia, Oct 20 - 26, 2006 / No.1499

SINGAPORE – Singapore is having a bumper year with Japanese overseas school tours (OST) heading this way in record numbers. But ground agents handling the market said it must rapidly address some issues to continue reaping high marks from student groups.

JTB Singapore general manager, Mr Takashi Stanley Uno, said: “We have a 15 per cent increase in the number of Japanese public high school students this year compared to 2005.” NTA Travel Singapore, and World Holidays also reported healthier 2006 figures. Collectively, they handle the majority of Japanese OST inbound into Singapore.

Strained diplomatic ties between Japan and its neighbours, China and South Korea, led schools to head for “safe destinations” such as Singapore out of concern for students’ security. Mr Uno said once political tensions ease, “there may be a shift back to travel in China and South Korea, which are popular destinations”.

His comments highlight external developments boosting OST performance which may change, chipping away recent market gains. Recent economic and political developments also played an important role in driving student traffic here. Agents said some Japanese school groups diverted to Singapore from Australia when travel there became too costly due to airline fuel surcharges. Schools switched to cheaper places rather than ask parents to top up the amount.

Agents also raised issues that may signal rain clouds on the horizon.

NTA Travel Singapore managing director, Mr Shigeru Nakashima, explained: “The budget for public high schools’ OST is determined by each prefecture’s education board. For 2006, the average is ¥100,000 (US$841) per student, inclusive of air fare and accommodation.”

Singapore, becoming increasingly expensive, must address cost issues or find the price-sensitive student tour market drifting away. Mr Uno said: “Hotels are the biggest problem. Rates are rising rapidly....Malaysia and Thailand are also eager to get student tours and their hotel rates are much cheaper than Singapore. Maybe hotels here can offer student discounts.”

World Holidays general manager, Mr Chua Kim Song, added: “Hotels do not want to accept large groups next year because of yield management. If this continues, schools may go elsewhere, like Malaysia.”

>>Full article