Tourists are flocking back to Southeast Asia — but the robust recovery is showing signs of cracks

After more than two years of border controls, Southeast Asia is finally starting to feel like it used to.

Singapore, Thailand and Malaysia are the most popular destinations for flights this year, according to the flight data analytics firm.

Singapore, which had the most inbound flight bookings in the region this year, saw its bookings rise from 30% in January to 48% by the end of June. The Philippines saw an increase in bookings from 20% at the start of the year to 40% by the end of June.

The number of international visitors to Southeast Asia more than doubled from 63 million in 2009 to 139 million in 2019.

The industry accounts for between 20% and 25% of GDP in Thailand, Cambodia and the Philippines, according to the Asian Development Bank.

Cirium’s chart on the absolute number of flight seats booked in 2022 in Southeast Asia and Nepal.

The travel research firm Check-in Asia said that the Pandemic was more devastating in Southeast Asia than the rest of the world. Domestic travel was restricted.

He said that North America and Europe had some tourism and travel flows.

Travelers in Singapore, Thailand, Indonesia, Malaysia, Vietnam, and the Philippines are no longer required to take Covid-19 tests.

Stanley Foo, founder of the local tour operator Oriental Travel & Tours, said business has picked up after Singapore dropped its pre- travel testing requirement. Travelers are spending more and booking longer vacations.

The company got around 20 tour bookings a week before the Pandemic. It now handles 25 bookings a week, some for trips up to 10 days. The average cost of a custom tour rose from $2,000 to $4,000 to $6,000 today.

Foo said it was because of the revenge travelling. For the last two years, they have saved up.

Foo said that since tourists are spending more time in Singapore, he and his team of tour guides are taking clients to places outside the usual tourist itinerary.

People are spending more time planning their journeys as well. She said they are making sure they are covered for unforeseen changes.

He said that tourists are from all over the world.

Foo said that Chinese nationals were among his company's biggest clients before the economic downturn. Non-essential travel out of the country is limited by China.

With China largely closed, tourism operators in Southeast Asia will target Japanese, South Korean, and in particular, Indian, tourists to make up for the shortfall of Chinese visitors, said Check-in Asia’s Gary Bowerman.

According to the Asian Development Bank, more than 30% of tourists to some Southeast Asian nations were from China.

According to Lu, the traffic decline in China has worsened in April due to restrictions on air travel to and from the country.

John Grant, chief analyst at the travel data company OAG, said that Asia's travel recovery lags behind other continents because of its reliance on international visitors.

More than half of flight capacity in Southeast Asia is measured by scheduled airline seats. Europe and North America have returned to their pre-pandemic capacities.

Inflation, interest rates, and a potential recession are some of the global challenges facing Southeast Asia.

According to the International Air Transport Association, the price of jet fuel was up 128% from a year ago. Grant said that it does not appear to have impacted demand since people have two years of demand left.

If fuel surcharges coincide with inflation, that could change in a hurry.

Emerging economies will devalue their currencies against the U.S. dollar, making imports more expensive and reducing how much travelers can spend on holidays.

Most people aren't canceling their plans just yet.

Singapore-based travelers are already planning year-end holidays, while others are booking trips in September and October, according to Lavinia Rajaram.

Air ticket prices may go down if airlines get their capacity back to pre-covid levels.

In the second half of the year, there will be more conventions and exhibitions being held in Singapore, where companies can engage agencies like his to conduct side tours for business visitors.

Air carriers may have to turn away tourists if they can't find enough workers to serve them.

The first two years of the Pandemic caused many workers in the air travel industry to leave. According to the global air transport association Aviation Benefits Beyond Borders, the number of jobs in the aviation industry decreased by 50% at the end of 2011.

The summer travel season in Europe and North America is frustrating due to flight cancelations and delays. Low pay and poor working conditions have made it unattractive to work at airports and airlines.

The travel chaos in other parts of the world that has yet to hit Southeast Asia is something officials hope to avoid.

The Changi Airport Group wants to fill 250 vacancies by the end of the year. The airline said in an email to CNBC that it had selected more than 800 cabin crew from several thousand applications.

Demand for air travel remains uncertain as Malaysia progresses into the endemic phase of Covid-19 according to the Malaysian Aviation Commission.

Singapore Airlines said passenger capacity averaged around 61% of pre-pandemic levels in the first quarter and expects a rise to 67% in the second quarter of 2022, the airline said in a statement in May 2022.

There were cracks in the ground. According to local media reports, Changi Airport Group had to retime some flights in April because of a staff shortage.

The Hari Raya Aidilfitri celebrations in late April and early May were delayed because of a lack of workers, according to Malaysian media.

airlines have been denied additional slots to land or take off because airports didn't have enough manpower to accommodate the extra flights

The plan is to get back to pre- Covid levels but with China uncertainty, it will be difficult.