Smart Tourism Ecosystem Development Readiness in Southeast Asia

This brief tracks how Southeast Asian countries are using smart technologies to make their tourism sectors more competitive, inclusive, and sustainable, and outlines the complex financing and infrastructure challenges they face. The brief shows how integrated technology can be harnessed by the tourism sector for uses from e-visas to smart waste management and cashless payments, benefiting businesses, consumers, and destinations alike. With Thailand topping its smart tourism readiness table, the brief explains how countries should look to narrow the digital divide, tweak policies, and pull in private sector financing to provide tourists the convenient digital solutions they increasingly expect.

to web-based digital interactions that take place before and after travel, a key feature of smart tourism ecosystems is the use of technology to interact with visitors while they travel, in real-time, to shape their experience and collect various types of consumer data.For example, the MySentosa application in Singapore uses real-time consumer data such as waiting times and crowd levels at attractions, allowing visitors to adjust their itineraries in real-time. 4able 1 provides other examples of how smart technologies can be applied across various tourism domains.Data management and analysis.Platforms combine, visualize, and analyze tourism and non-tourism data from public and private sources using Big Data techniques, artificial intelligence, and automation to formulate data-driven policies.
Early warning detection systems.Systems of meteorological and geological sensors to detect adverse weather conditions, tsunamis, and other disasters, providing critical lead time for emergency response.

Infrastructure and sustainability
Managing tourism flows.Smart traffic lights, sensors, and cameras collect real-time data about tourist flows and congestion in tourism destinations, to guide infrastructure planning and investment and improve overall destination management.
Smart waste management.Smart bins with sensors monitor waste levels and provide real-time data through a cloud-based system to optimize waste collection.
Energy-efficient tourism buildings.Smart heating, ventilation, and air conditioning systems reduce energy consumption.
Environmental monitoring.Sensors, smart cameras, and other geographic information systems to monitor water and air quality, wildlife, or natural features to aid in data-driven management.
Marketing Big Data analytics.Big Data to gather and analyze visitor demographics, travel choices, and spending patterns to inform tourism marketing strategies.
Social media analytics.Smart technologies that analyze social media data to identify patterns and trends in visitor's behavior and preferences.
Predictive analytics.Technologies that anticipate future demand to guide marketing strategies.
Search trend analytics.Technologies to analyze search engines and identify consumer preferences.
Visitor reviews and ratings.Visitor reviews and ratings analysis drawn from social media and review platforms to inform campaigns and product development.

Drivers
Tourist and industry demand.Accustomed to using technology in their daily lives, tourists expect smart tourism systems offering convenient and personalized services before, during, and after trips. 5Enhanced health controls and social distancing during the coronavirus disease (COVID-19) pandemic accelerated digitalization and the adoption of smart solutions, raising expectations for accessible digitally driven operations. 6Private sector tourism businesses such as hotels, tour operators, and transportation companies are responding to this demand by adopting smart solutions to offer seamless, safer, and integrated experiences for tourists, while also benefiting from the operational efficiencies that digitalization offers. 7 Digitalization in tourism policies and strategies.Regional and national tourism policies and strategies increasingly emphasize digitalization and smart approaches (  Both factors use quantitative indicators to ensure comparability and objectivity in the assessment process. Each indicator was scored based on a scale of 0 to 100, with 0 representing the lowest score and 100 the highest.However, due to differences in how each indicator was ranked in the underlying indexes, four separate scoring standards were developed to convert the original ranking into a common scoring system for the purpose of comparison (Table 3).Scoring Standard 1 was applied to indicators that were ranked between 0 to 100 in the underlying index.In this scale, a score of 100 represented the best possible score.For example, an existing ranking of 66 would yield a score of 80 in the benchmarking.Scoring Standard 2 was used for indicators that were ranked on a scale that exceeded 100 points, and a score of 1 represented the best possible score.For example, if a country ranked 35, they received a score of 80 in the benchmarking.Scoring Standard 3 was applied to indicators that were ranked from 0 to 10.
Here, a score of 10 signified the best possible score.If a country ranked 7, they received a score of 80 in the benchmarking.Scoring Standard 4 was applied to indicators that used a percentage.
Here, a score of 100% signified the best possible score.If a country had 60% for the indicator, they received a score of 80 in the benchmarking.
Each factor score was derived from the average of the indicator scores under it.The final country score was determined by taking the average of the two-factor scores.Both factors were assigned equal weight.The other five countries assessed displayed moderate readiness to develop smart tourism ecosystems, with Viet Nam scoring 67 and Indonesia scoring 66, followed by the Philippines (56), the Lao PDR (53), and Cambodia (50).

Regional Results
Factor 1. Enabling environment attained a regional average score of 55.Thailand attained the highest score at 71, followed by Indonesia (69), Viet Nam (63), the Philippines (57), Cambodia (49), and the Lao PDR (49).In terms of tourism competitiveness, Thailand and the Philippines received favorable ratings due to their ranking in the 2021 World Economic Forum Travel & Tourism Development Index. 15 In relation to smart tourism, Cambodia and the Lao PDR have a smaller share of tech-savvy tourists among their primary markets.Conversely, Indonesia stands out with high level of tourist tech-savviness, suggesting that visitors to this country may be more receptive to embracing smart tourism offerings.
The enabling environment scoring also considers gender and rural digital divides.Regarding equality between men and women's internet usage, the Lao PDR and the Philippines ranked highest.The regional average score for rural digital divide, which measures the disparities in online engagement between urban and rural individuals, was 40 with a range of 20 to 60.Low digital equality scores undermine establishing countrywide, equitable smart tourism ecosystems across and within primary, secondary, and rural tourist destinations.
Regarding the legal environment for businesses, which refers to the extent to which institutions enable businesses to adopt digital solutions, Thailand scored highest.When it comes to availability of financing solutions for smart tourism development, which is particularly important for MSMEs, all countries assessed scored low-averaging just over 35.On the other end, the role of start-ups in supporting digital development has a more positive outlook.Five of the six countries assessed scored 80 for this indicator.
Factor 2. Technological readiness had a regional average score of 62. Thailand scored 73, followed by Viet Nam (72), Indonesia (64), the Lao PDR (57), the Philippines (55), and Cambodia (51).Mobile phone subscriptions are nearly universal, with five of the six countries scoring 100 for this indicator and the Lao PDR following closely with a score of 80. Household internet access in urban areas scored highly, with Indonesia, the Lao PDR, Thailand, Viet Nam, all obtaining a score of 100, followed by the Philippines (80) and Cambodia (60).For rural areas, the regional average was 70.Thailand achieved a score of 100, followed by Viet Nam, the Lao PDR, and Indonesia all scoring 80. Cambodia and the Philippines both scored 40 for household internet access in rural areas, highlighting accessibility challenges remain in underdeveloped and remote areas.The benchmarking exercise also found high average monthly costs to purchase internet services across the region.The Philippines scored 20, indicating comparatively high costs, while Viet Nam scored 100, indicating the most affordable internet access in the region.The remaining countries received scores ranging from 40 to 80, indicating varying levels of affordability.Mobile access affordability, which considers both the cost of mobile subscriptions and devices, is comparatively low for all the six focus countries, ranging from 20 to 60 with an average score of 50.Taken together, high internet and mobile access costs deter microenterprises and lower-income residents from using online resources.
Internet penetration, which measures actual internet usage rather than just accessibility or availability, had scores ranging from 40 to 100.Meanwhile, average internet speeds in the Philippines, Thailand, and Viet Nam scored 100.Indonesia and the Lao PDR scored 40 and Cambodia scored 20.For mobile internet average speed, the regionwide average was 40.Viet Nam stands out with relatively higher mobile internet speed, scoring 100.High speeds are a smart tourism competitive advantage and slow speeds pose challenges as they undermine businesses' ability to employ smart features and inhibit visitors' ability to engage with them.E-visa availability was also considered.Cambodia, Indonesia, the Lao PDR, and Viet Nam all received scores of 100 because visitors from at least 158 countries are eligible to for e-visas.The Philippines received a score of 20 given its e-visa facility was open for only a few select markets in 2023.
All countries assessed scored low regarding digital talent availability, with a regional average score of 50, ranging from 40 to 60, reinforcing the need for technology-related skills training and capacity development.
Considering the average regional scores for indicators ranking highly (i.e., 71 or greater), regional strengths to build on include high mobile phone usage and internet access in urban areas, 4G coverage, digital gender equality, startup capacity, and tourist tech-savviness.On the other hand, regional average scores of 40 or lower indicate there is an urgent need to pay more attention to strengthening digital talent availability, the legal environment for businesses, financing options for technological development, improving access to digital payments, and closing the rural digital divide.

Country Assessments
Each country assessment was informed by benchmarking indicators and consultations with national tourism organizations during February to May 2023.Country consultations qualitatively explored strengths, weaknesses, opportunities, and threats regarding smart tourism development and the experience gained from select smart tourism development initiatives.
Cambodia.Cambodia has a promising landscape for smart tourism ecosystem development.Opportunities to build on include strong digital inclusion, moderate tourist tech-savviness, and high 4G mobile coverage.However, critical issues to be addressed include strengthening the legal environment, expanding financing options, narrowing the urban-rural digital divide, and expanding rural household's access to the internet.
The Roadmap for Recovery of Cambodia Tourism During and Post-COVID-19 2021 outlines strategies such as promoting smart tourism investment projects, launching digital apps that offer multilingual guides, travel services, and online payments, and establishing digital support networks that include free Wi-Fi for tourists at major destinations.Additionally, there's an emphasis on developing telecommunications infrastructure in rural destinations. 16Cambodia has also made progress with digital payments.In July 2022, The National Bank of Cambodia launched a standardized QR code payment system called KHQR.KHQR users can pay or receive payments in Cambodian riel or United States dollars. 17Consequently, cashless payment adoption in Cambodia is rising. 18donesia.Indonesia shows a strong integration of digital technologies to support smart tourism and bridge the urban-rural and gender digital divides.However, challenges to be addressed include improving computer access, expanding financing options, reducing broadband internet costs, and increasing the average broadband internet speed and mobile internet speed.
Ongoing efforts to foster digital inclusion include the Indonesian Ministry of Tourism and Creative Economy Indonesian Tourism Village Award national program, introduced in 2021 to promote and recognize locally generated creative digital content and digital adoption. 19Indonesia is also working to improve internet affordability and broadband and mobile internet speeds.Initiatives like the $540 million SATIRA-1 satellite launch in June 2023 are poised to revolutionize connectivity, projecting speeds up to 150 gigabytes per second by 2024.SATRIA-1 is expected to provide free internet connections for 150,000 public facilities including schools, hospitals, and government buildings, transforming technological readiness for smart tourism in rural and secondary destinations across Indonesia. 20Lao People's Democratic Republic.The Lao PDR's strong scores in digital gender inclusion, urban and rural internet access, and availability of e-visas all contribute to its current and future smart tourism  readiness.However, headwinds to address include the need to narrow urban-rural digital divides, increase smart tourism financing options, improve computer access, and expand access to digital payments.
The Lao PDR promotes partnerships to foster smart tourism ecosystem development, particularly in urban and primary destinations.Notably, the LCR Ticket application, launched in March 2023, allows passengers to purchase rail tickets online using Chinese, Lao, and English languages.Developed by a subsidiary of China State Railway Group and available on iOS and Android devices, passengers can book domestic tickets within Lao PDR and international tickets between the Lao PDR and the People's Republic of China. 21Passengers may use multiple forms of e-payment and receive a QR confirmation code to redeem tickets at departure train stations. 22Meanwhile, in Vientiane, a sophisticated bus locator and traffic observation system utilizing GPS technology and Wi-Fi packet sensors, was started in 2015 to modernize public transport and reduce congestion.This techdriven approach allows passengers to use smartphones for real-time bus location updates, boosting public transport usage and enhancing urban planning with accurate, real-time data.Known as Lao-BusNavi and accessible at http://lao.busnavi.asia,the system represents a significant advancement in tackling Vientiane's traffic issues. 23ilippines.The Philippines demonstrates strong gender equality, high average broadband internet and 4G coverage, and good transaction infrastructure supporting online access to finance.Additionally, the Philippines has high digital talent availability.Smart tourism development issues to be addressed include closing the urban-rural digital divide, expanding financing options, lowering broadband costs, and fully launching an e-visa facility.
To bridge the urban-rural digital divide, the Department of Tourism (DOT), in collaboration with the Tourism Promotions Board Philippines, has allocated about $2 million to local government units (LGUs) nationwide for smart tourism projects.These funds facilitate creation of local tourism websites, mobile apps, and digital marketing tools, alongside the integrated Visitor Information and Travel Assistance (VISITA) platform. 24In 2023, a similar facility 25 was created by the Land Bank of the Philippines to extend credit to LGUs and DOT-accredited tourism enterprises for establishing or enhancing primary tourism support facilities, infrastructure, and services; including automation and digitalization initiatives for tourism services.The Philippines also began offering e-visas to select countries in the second half of 2023, 26 helping raise tourism competitiveness and enhancing smart tourism readiness. 27Finally, the Philippines is working with development partners to improve various elements of the smart tourism ecosystem.For instance, in partnership with the ADB, the recently approved Davao Public Transport Modernization Project (2023) will leverage technologies to establish a smart transportation system including bus priority traffic signaling, a bus operation control center, an automated fare collection system, and Wi-Fi connection in buses, terminals and depots, and other public waiting areas. 28 Thailand.Thailand's strengths include its high tourism competitiveness ranking, legal environment for business, high internet penetration, high average broadband internet speed, and widespread digital talent availability.Additionally, tourist digital savviness, low gender digital divides, and wide availability of rural internet access all set a sturdy foundation for smart tourism ecosystem development.
Thailand's recently upgraded e-visa processes allows applicants from 90 countries to apply for and obtain tourist visas using the Thai E-Visa Official Website. 29Challenges to be addressed include expanding MSME financing options, improving computer access in low-income areas, decreasing mobile access costs, improving rural digital equality, and increasing mobile internet speeds.
The ThailandCONNEX Platform is a good-practice tripartite partnership between the Digital Economy Promotion Agency, the Tourism Authority of Thailand, and the private company Travizgo Technology Co., Ltd. 30 The platform comprises three components.First, the National Digital Tourism Platform is an online business-tobusiness marketplace allowing tour operators to sell their products and services to domestic and international partners.Second, the National Digital Tourism Token facilitates the use of Blockchain and Tokenomic design principles to incentivize and reward repeat transactions.Finally, the National Digital Tourism Data Bank is a centralized system that warehouses data on entrepreneurs in the tourism industry, providing data that can be used by the government to support policymaking and targeted assistance programs.and access to electronic payments, and improving digital talent availability.
Viet Nam has initiated programs to address some of these challenges.For example, the Rural Tourism Development Program in New Rural Development is an initiative to develop the rural digital tourism economy. 32The goal is to have at least 50% of recognized rural tourist spots promoted digitally and using digital technologies by 2025.To achieve this, at least 70% of rural tourism establishment owners and 80% of rural tourism workers will receive digital skills and entrepreneurship training.A database and digital mapping of rural tourist attractions is also underway. 33

Good Practices
Access to finance and skills.Narrow digital divides.In addition to scaling up government and private investments for essential ICT infrastructure, expanding skills training and capacity development for destination managers and tourism businesses, particularly women-owned enterprises, is needed to boost smart tourism capacity and digital literacy in lagging areas.Like Singapore 's Hawkers and Seniors Go Digital programs, partnerships between technology firms, business associations, and government can assist MSMEs and vulnerable populations overcome technology knowledge and skills gaps.
Promote regional knowledge sharing platforms.Countries in Southeast Asia would benefit from more exposure to global smart tourism good practices and opportunities to share their own smart tourism experiences and good practices with one another.For example, the ASEAN Digital Awards (formerly the ASEAN ICT Awards) recognize exceptional organizations, businesses, and individuals who have pioneered innovative products or services that contribute significantly to the region's digital landscape. 40n addition to the five existing award categories, the platform could be expanded to include one or more categories focused on smart tourism ecosystems.The European Commission's online Smart Tourism Destinations regional knowledge hub and competitions offer replicable lessons.

CONCLUSION
Smart tourism ecosystems improve destination competitiveness, and can facilitate greater inclusion and sustainability.In Southeast Asia, countries prioritize different aspects of smart tourism ecosystem development in their national digitalization and tourism policies and have made progress in enhancing readiness for digital transformations.However, challenges remain.To overcome these, countries should enact policy reforms and deploy public resources to catalyze private finance for ICT infrastructure and service expansion, expand access to smart tourism financing solutions for MSMEs, boost skills training investments in lagging areas, and use regional platforms to share relevant knowledge and experiences for further improving the smart tourism ecosystem legal and policy environment.
The views expressed in this publication are those of the authors and do not necessarily reflect the views and policies of ADB or its Board of Governors or the governments they represent.ADB does not guarantee the accuracy of the data included here and accepts no responsibility for any consequence of their use.The mention of specific companies or products of manufacturers does not imply that they are endorsed or recommended by ADB in preference to others of a similar nature that are not mentioned.By making any designation of or reference to a particular territory or geographic area in this document, ADB does not intend to make any judgments as to the legal or other status of any territory or area.

15
World Economic Forum.2022.Travel & Tourism Development Index 2021: Rebuilding for a Sustainable and Resilient Future.Geneva.

25
The Tourism Infrastructures and Services Mobilization (TOURISM) Lending Program of the Land Bank of the Philippines has allocated an initial program fund of P5 billion (approximately $89 million) for this credit facility. 26Rocamora, J. A. L. 2023.Philippines to soft launch e-Visa in China this August: DFA.Government of the Republic of the Philippines, Philippine News Agency.26July.

Table 1 :
Smart Technologies-Tourism Applications Domain Examples Destination management Real-time monitoring.Cameras and sensors monitor crowd levels and visitor flows to improve the visitor experience and safety.Monitoring data guides tourism development and management strategies.

Table 2 :
Policies and Strategies Supporting Smart Tourism in Southeast Asia country-level digitalization indexes along with relevant literature on the subject.The first factor assesses the enabling environment, with seven indicators covering tourism competitiveness and the legal, financial, social, and geographic aspects of digital inclusiveness.The second factor assesses technological readiness and includes 15 indicators associated with the availability, accessibility, and affordability of digital technology.
ASEANASEAN Declaration on Digital Tourism 2020 Use digital technology to transform the tourism sector and enhance cooperation among ASEAN member states to identify tourism opportunities and fill gaps in the digital transformation journey.
a L. Uppink and Soshkin, M. 2021.Travel & Tourism Development Index 2021: Rebuilding for a Sustainable and Resilient Future.World Economic Forum (accessed 23 April 2023).b g International Telecommunication Union.2022.Digital Development Dashboard: An overview of the state of digital development around the world based on ITU data (accessed 2 April 2023).h Cable.co.uk.2023.Global broadband pricing league table 2023: Study of broadband pricing in 219 countries reveals vast global disparities in the cost of getting online.i Tufts University.2021.Digital Evolution: Country Dashboard (accessed 25 April 2023).j World Bank and International Telecommunication Union.2021.Individuals using the Internet (% of population) (accessed 1 July 2023).k Ookla.2023.Speedtest Global Index (accessed 1 April 2023).l Indicator score derived by dividing the number of countries eligible for e-visa by 195 countries.Source: Author's compilation.

Table 4 continued
Benchmark and summary scores.The benchmarking assessment is presented in Table4.Thailand achieved a score of 72, signifying that it is entering high smart tourism ecosystem development readiness.

16
Government of Cambodia, Ministry of Tourism.2021.Roadmap for Recovery of Cambodia Tourism During and Post COVID-19.Phnom Penh.Ministry of Tourism and Creative Economy, Tourism and Creative Economic Agency.2023.Anugerah Desa Wisata Indonesia 2023. 20South China Morning Post.2023.Indonesia launches 'most powerful' satellite with SpaceX to boost high-speed internet coverage.20 June.Vongphachanh.2023.Laos-China Railway Ticketing App is Now Officially Online.The Laotian Times.15 March. 22Global Times.2023.Laos enters era of online train ticket sales with new app.14 March.
-step guidance on digital solutions and employee training.34TheHawkersGoDigitalprogram-launchedbymultiplegovernmentagenciesand street vendor associations during the COVID-19 pandemic-provides cash incentives for street traders to adopt digital payments.It also trains vendors how to join and make the most of online delivery platforms.35Singapore'sSeniorsGoDigitalprogramempowersolderpersons to use technology for communication, government services and lifestyle apps, and e-payments and digital banking.36Regionalknowledgesharing.Smart Tourism is a European Union initiative implemented by the European Commission.One of its core pillars is to help establish a framework for the exchange of best practices between European destinations and foster cooperation and new partnerships.Related to this, the European Commission has launched two competitions.TheEuropean Capital of Smart Tourism award recognizes outstanding achievements by European cities as tourism destinations in four categories: sustainability, accessibility, digitalization, and cultural heritage and creativity.Similarly, the European Green Pioneer of Smart Tourism award recognizes smaller destinations that have successfully implemented strategies to boost sustainable tourism through green transition practices.37These,andotherinitiatives, are disseminated on the European Union-supported Smart Tourism Destinations website, a regional content and knowledge hub with information about various destinations and how they are implementing smart and sustainable solutions.38EuropeanCommission.2023.Leading examples of Smart Tourism Practices in Europe.
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