The latest data from the Philippine Statistics Authority showed that tourism direct gross value added – the measure of economic output directly generated by tourism-related industries – fell to 8.1 percent of gross domestic product (GDP) in 2025 from the revised 8.7 percent in the previous year.
The figure marks the lowest tourism share to GDP in three years, or since 2022 when the industry had just started recovering from the pandemic.
Notably, the tourism industry’s contribution to the economy has yet to return to pre-pandemic double-digit growth levels.
The decline came largely from weaker inbound tourism expenditure, or spending by foreign visitors in the country, which dropped 6.4 percent to P698.46 billion from P745.99 billion a year earlier.
Separate data from the Bureau of Immigration, as cited by the Department of Tourism, showed that total foreign visitor arrivals – including returning overseas Filipinos – reached 6.48 million in 2025.
A discussion paper by the Philippine Institute for Development Studies said the recovery in inbound tourism expenditures had been gradual. It further explained that full recovery in the industry has yet to be realized as growth in visitor spending value added and sectoral investments remain tempered.
Domestic tourism expenditure, however, continued to grow and partly cushioned the decline in foreign visitor spending. Spending by local travelers rose 3 percent to P3.26 trillion in 2025 from P3.16 trillion in the previous year.
In contrast, outbound tourism expenditure, or spending by Filipinos traveling abroad, increased by 3.5 percent to P357.93 billion.
Meanwhile, employment in tourism industries reached 7.7 million persons in 2025, up 2.5 percent from 7.5 million in the previous year. That brought the share of tourism-related employment to total employment in the country to 15.7 percent.
The PIDS report acknowledges that the Philippine tourism industry had made advancements over the years, but these were still insufficient to erase the country’s standing as a regional laggard.
“Persistent issues, such as inadequate infrastructure, weak interconnectivity between tourism circuits, environmental sustainability concerns, and policy fragmentation must be addressed to address tourism’s full potential,” it added.
Despite its huge potential, the tourism sector in the Philippines continues to underperform, especially when compared to our neighbors. If we cannot use global crises as an excuse because it affects all the players in the sector, how are we allowing the other countries that we are supposed to be directly competing with to leave us so far behind?*
