The Committee appreciates the Tourism Administration’s (TA) goal of welcoming 12 million inbound tourists in 2024, a return to pre-pandemic levels and twice the number set for 2023. However, we also note that the tourism industry continues to face severe labor shortages as a result of pandemic-related business closures, raising concerns about Taiwan’s ability to meet the service needs of these tourists.

In 2023, Japan experienced a 21% decrease in international tourists compared with 2019, and Thailand saw a reduction of approximately 30%. Taiwan faced an even more significant decline of over 45%, demonstrating the need for targeted strategies to revitalize its tourism sector and regain pre-pandemic visitor levels. In addition, the tourism industry has been transformed by an increased focus on digitalization and sustainability, making it necessary for Taiwan to adjust its tourism promotion strategies and policies.

Considering its comparatively slow tourism rebound, Taiwan needs to urgently accelerate efforts to reposition itself as an attractive destination. With that in mind, the Committee provides the following suggestions:

Suggestion 1: Allow short-term access for foreign workers to entry-level jobs in the tourism industry to address labor shortages.

Insufficient staff levels adversely affect service quality, operating costs, and Taiwan’s reputation as an international tourism destination. Labor shortages result in longer wait times, scaled-back activities, and issues with maintenance and cleanliness of attractions and landmarks. International tourists with negative travel experiences may be deterred from visiting Taiwan again.

Furthermore, the Committee has noted a misalignment between the skills and desires of Taiwan’s unemployed population and industry needs. Numerous surveys and local news reports have revealed that the younger generation, a meaningful source of labor, does not feel incentivized to enter the tourism industry. Given this situation, Taiwan must develop a robust strategy to maintain service quality and cultivate talent in the hospitality sector.

The Committee suggests reassessing the deployment of migrant workers across industries and extending their employment opportunities to include the tourism and hospitality sector for the next three to five years, after which the success of these initiatives can be evaluated. Currently, migrant workers in Taiwan are limited to employment in manufacturing, caregiving, construction, and agriculture. We recognize the efforts of the Ministry of Labor (MOL) in opening the Long-term Retention of Migrant Workers Service Center dedicated to retaining skilled workers in Hsinchu County within those industries. We urge the MOL to expand those resources to include more sectors.

The tourism industry is grappling with a significant labor shortage as demand increases. Addressing this issue will require close cooperation between government and industry to effectively meet the growing need. Prompt action is necessary to prevent Taiwan from missing out on the growth opportunities available in the post-pandemic era and to enable the tourism sector to thrive in the coming years.

Suggestion 2: Improve tourism branding and marketing strategies.

An updated strategy with specific, measurable actions, budgets, and milestones is critical to help meet the government’s goal of welcoming 12 million visitors annually. The Committee encourages the government to reference regional best practices, such as those in Singapore, to position, promote, and inspire travel based on clearly defined approaches that yield the highest success rates.

Recommendations:

• Redefine Taiwan’s tourism mission, vision, and supporting marketing messages to resonate with modern tourism and drive success. We recommend that the government develop clear and concise statements for use in marketing. The TA unveiled its new slogan and brand strategy “Taiwan – Waves of Wonder” in May. Further efforts to introduce memorable, engaging marketing slogans and statements in connection to the updated brand could significantly enhance audience engagement and rejuvenate Taiwan’s brand image.
• Identify key feeder markets and allocate budget, resources, initiatives, and partnerships to these areas. Prioritize activities and investments that promise the highest return, ensuring that efforts are focused and effective in generating the desired outcomes for the tourism sector.
• Allocate a minimum of 30% of the total tourism promotion budget to promote destinations outside Taipei and adopt a more inclusive approach to promote Taiwan as a whole.
• Implement a high-frequency PR and marketing campaign that leverages renewed and improved marketing materials, videos, and intensive key opinion leader collaborations to increase visibility in key feeder markets. Efforts should highlight the diverse and appealing aspects of Taiwan, showcasing its unique offerings to attract more visitors and enhance its reputation as a premier travel destination.
• Conduct quarterly marketing performance reviews, providing updates to industry representatives and the public. The review should include the original targets set for each feeder market, the marketing resources or channels used, and results achieved, accompanied by an analysis for future improvement.
• Incorporate digital marketing strategies in policymaking and allocate budgets proportionally to digital marketing efforts, including the use of online digital platforms frequently utilized by neighboring countries’ tourism authorities. Given that online channels are now a primary resource for inbound travelers to discover Taiwan, search for flights and accommodation, and plan their trips, it is imperative and leverage these digital platforms effectively.
• Organize regular dialogue between the TA and the Committee to explore and address challenges related to tourism marketing.

Suggestion 3: Develop ESG policies for the tourism industry.

The Committee urges the TA to develop a clear, tailored, and cohesive environmental, social, and governance (ESG) strategy for the tourism industry. This strategy should be relevant and specific while allowing flexibility for various hotel segments to implement alternative solutions in order to enhance consumer satisfaction.

We further urge the TA to coordinate with other ministries and stakeholders when drafting the strategy to ensure clear and cohesive guidelines that meet industry needs and address the industry’s challenges.

Recommendations:

• Work with industry to set differentiated standards for hotels and high-end services, such as Michelin restaurants, spas, and resorts. For example, guests booking luxury hotels typically expect amenities such as slippers to be provided. Instead of removing these amenities across all categories, it would be beneficial to allow high-end hotels to offer eco-friendly and locally-produced alternatives. Maintaining distinct amenities is crucial as they serve as one of the key differentiators between hotel classifications.
• Form a steering committee with representation from various tourism partners to advise on international ESG practices that safeguard high service levels. This group should consider industry-wide labor shortages, ensuring that ESG compliance solutions do not inadvertently exacerbate other challenges.
• Adopt impactful yet manageable actions, such as mandating the use of environmentally friendly takeout containers at food and beverage establishments to reduce hotel waste.
• Implement support programs that encourage businesses to adopt environmentally friendly practices rather than imposing outright bans on products. Programs should provide guidance, financial incentives, or resources to facilitate the transition to sustainable practices while helping businesses maintain service quality.

Suggestion 4: Advance digitalization in the tourism industry.

The industry is currently facing challenges in achieving high value and output, primarily due to a lack of technological empowerment and capital investment, hindering scalability. Digitalization and internationalization are the directions for transforming and upgrading the travel and tourism industry. Internationalization in particular is critical for Taiwan’s service industry to produce foreign exchange income. To significantly rejuvenate the tourism industry, it is essential to prioritize industry improvements supported through policy measures.

In the meantime, tourism helps boost consumption and GDP growth. Empowering the application of travel-related technology and digitalization is essential to effectively increase value and output in the industry. According to data provided by various electronic ticket system providers and room-booking transaction platforms, less than 20% of accommodations and less than 2% of travel experiences offered in Taiwan were sold online in 2022.

We urge the government to establish a national team that develops policies for and promotes the development of smart tourism digital infrastructure, such as AI customer service software leveraging a travel knowledge database to swiftly resolve issues related to bookings and services, as well as offer education and resources helping small businesses develop their own apps. A technologically empowered service industry will not only upgrade the industry itself but also drive increased inbound tourism.

Further efforts could include increased subsidies for charter flights and cruise ship transportation that utilize operational digital tools such as Software as a Service (SaaS), similar to the TCloud marketplace developed by the Administration for Digital Industries under the Ministry of Digital Affairs. Such a SaaS platform offers various software solutions that allow small businesses to operate efficiently without the need for large budget allocations typically required for branded software products. While the government may not need to develop these tools directly, it should take responsibility for surveying, collecting, and promoting digital tools that are both easy to use and cost-effective. Such strategic support would facilitate a substantial transformation in the tourism sector, enhancing its contribution to the broader service industry.