Foreign tourist arrivals surge

• Foreign tourist arrivals reached 1.83 million as of March 2026, up 10.4% year on year, with South Korea (20.4%), the USA (18.7%) and Japan (8.3%) among the leading source markets.
• South Korea arrivals recovered to 62.9% of 2019 levels in 2025, remaining the top source market. The Philippines aims to sustain this growth through enhanced airline partnerships, collaborations with travel agencies and campaigns showcasing diving, golf and experiential tourism.

New supply enters the market

• Hotel inventory increased by 304 rooms in Q1 2026 with the opening of Somerset Valero Makati and Alino Hotel in Quezon City. An additional 4,000 rooms are expected to open in Metro Manila by year-end 2026.
• Foreign brands lead the hotel pipeline, reflecting strong market confidence alongside local developers, with approximately 6,500 new rooms expected to open by 2030.

Hotel performance remains solid

• Metro Manila hotels showed strong momentum in Q1 2026, with ADR and RevPAR both increasing year on year, signalling healthy demand dynamics and effective pricing strategies.
• The average daily rate for Metro Manila hotels stood at PHP 8,034 in the first quarter, reflecting a year-on-year uptick of 0.3% in 2026.

Outlook: Tourism faces short-term pressures

• Philippine tourism may face reduced travel demand and disrupted regional travel patterns in the short term. Nonetheless, the sector remains resilient and is well positioned for recovery as geopolitical tensions ease.
• Hotel occupancy rates are expected to face temporary softness due to current market conditions. Despite near-term pressures, hotel supply expansion remains robust, with new rooms scheduled to enter the market by year-end.