Many of today’s speakers called for a shift in focus from China – which experienced a slowdown of luxury goods spending in 2013 – and the Chinese passengers to ASEAN, whose GDP is the same as India’s, according to one of this morning’s speakers.

 

The 19^th TFWA Asia Pacific conference began this morning with the customary welcome and figure-heavy analysis from TFWA President Erik Juul-Mortensen.

 

Juul-Mortensen revealed Generation Research’s provisional 2013 results for the travel retail industry, to a packed out auditorium. According to Generation Research, GTR sales reached $60bn in 2013 with Asia Pacific accounting for 37.2% of the world market share.

 

Juul-Mortensen talked about the shift in the economic centre of gravity which has moved rapidly eastwards in the past 70 years as well as major upcoming tenders – Sydney and Incheon to name two – which will continue to change the travel retail landscape across the region.

 

An impressive number of delegates crammed into the large auditorium in Singapore this morning.

 

DECLINE OF LUXURY GOODS SALES

He said that success or failure of the ASPAC region weighs heavily on the the global economy. He spoke of the sharp decline of luxury goods sales affecting airports and that this could be a ‘timely signal’ to not just focus on China.

 

He highlighted emerging markets such as Vietnam, which recorded 7.4m international visitor arrivals (+12.1% YOY) in 2013, which the industry should start to look at more seriously.

 

Jaya Singh, President of APTRA began his presentation by thanking the former APTRA President, Sunil Tuli for his six years of service to the industry.

 

Singh then highlighted the exciting new developments in the Asia Pacific region, including those at Macao, Haneda and Changi Airports.

 

APTRA’S FOUR-PILLAR STRATEGY

He talked through APTRA’s four pillar strategy which will provide defence mechanisms from various existing or imminent threats to the travel retail industry, such as; illicit trade protocol allowances, labeling health warnings visibility restrictions, one bag rule, sin tax, LAGs and display restrictions.

 

TFWA President, Erik Juul-Mortensen.

 

He also talked about improving the region’s connectivity with the rest of the world and about the association’s new database which is ‘coming soon’.

 

Julia Gillard took to the stage to extol the virtues of a White Paper published by the previous government, called ‘Australia in the Asian Century’.

 

She mentioned the increased size of the middle class in Asia, which is of profound importance to Australia and the rest of the world. She said that China has grown by a factor of 20 in 25 years with a purchasing power set to eclipse the US.

 

$29.8BN TOURISM SPEND IN AUSTRALIA

“In this century, the region in which we live will become home to most of the world’s middle class. Our region will be the world’s largest producer of goods and services and the largest consumer of them,” said Gillard.

 

She said that we are living through enormous economic changes and leaving absolute poverty, in some Asia Pacific regions, behind. She said that Australia has a deep and growing engagement with China and therefore rejects calls from the US to try to contain it. “We welcome China’s rise,” she said.

 

She revealed that $29.8bn were spent by tourists in Australia in 2013 and the Chinese contributed $4.8bn (+16% YOY) to total overseas spend in the country.

 

 

“There is always more to do in attracting tourists,” said Gillard. “Development of a second airport in Sydney is key. Population growth is putting more pressure on our infrastructure which in turn makes for bad travel experiences, so this needs to be controlled.” She called for improvement in Australia’s hospitality training and a need for every nation to get the balancing act right between welcoming tourists and managing security issues.

 

 

TOUGH ACTION NEEDED

Her final point, about the 200-plus girls who were abducted by Boko Haram Islamists three weeks ago, and the fact that more action needed to be taken to return the kidnap victims, was met with a round of applause.

 

The penultimate speaker, was Robert Waloni Marketing and Business Development Director from Angkasa Pura Airports, standing in for Tommy Soetomo, President Director, who was too ill to make the journey to Singapore.

 

Waloni talked about the exciting and dynamic retail landscape of Indonesia pointing out that it has more than 200 airports, 34 of which are international. He said this would be a ‘decade of aviation’ for Indonesia.

 

He talked of developments in Bali and the company’s ever evolving partnership with its retail partners; Dufry, DFS, Flemingo and Heinemann. By 2020, Waloni says the company expects 121m passengers at Angkasa Pura airports.

 

Parag Khanna makes his point about Asia’s new silk roads.

 

‘THE NEW SILK ROADS’

He said that Angkasa Pura’s revenue from the non-aeronautical segment had reached 39% last year, up from 20% in 2010.

 

The conference’s final scheduled speaker was Parag Khanna Author and Strategist.  He called for the industry to look at things from a holistic point of view and also to think outside of the airports.

 

He talked up the importance and prevalence of ‘the new silk roads’; Asia’s high speed rail, knitting the enormous region together. “Connectivity between emerging market countries is growing at a staggering rate,” said Khanna.

 

The plenary conference closed with a message of thanks to the industry from Duty Free Philippines Chief Operating Officer Lorenzo ‘Enchong’ Formoso, relating to its support of DFP’s fundraising efforts following Typhoon Haiyan,

 

More to follow on today’s workshops, later this week.