The flurry of low-cost airlines setting up in the region has got the Singaporean authorities thinking. With budget fliers come budget travellers, and they need to be catered for.
In the past, the Singapore Tourism Board had made clear it was courting tourists with dollar spending power. But times are changing, and in an economy where tourism accounts for 10 per cent of gross domestic product, there are many reasons why travellers on a budget should also be courted, especially as the industry has been identified as one of the pillars of the economic transformation of the country.
Of course, Singapore has had budget hotels for years (there are currently 110), but the city state has never been a cheap place to hang around, especially compared with the rest of the region. Most western backpackers tend to use it as a base for a couple of days to 'resource' themselves in a clean environment before hitting the Asian trail again.
But the advent of budget airlines in the region could bring a new wave of Asian backpackers who could revolutionise the tourism industry.
Up to now, budget travellers have ended up in the so-called backpacker triangle between Bras Basah, Bugis and Little India. But the Urban Redevelopment Authority is encouraging new hotels to spring up in other selected areas. Meanwhile, the tourism board has engaged the International Youth Hostel Federation about the possibility of setting up an association here.
One argument is that by letting budget hotels develop in more remote areas, like Woodlands in the north for example, backpackers will get a better feel and a less aseptic perception of the island.
This is a reverse of policy, as the authorities had previously restricted such hotels in residential areas to 'protect' residents from the 'long-haired' elements.
Smart companies are already positioning themselves for the anticipated hoards. Leisure operator Cathay Organisation Holdings is planning to open its maiden 'Hangout' hotel at Mount Emily next month.
But let's not get too excited. At S$60 (HK$272) per night and up for a room, backpackers here will still pay more than twice what they would in Bangkok or Bali (without the coconut beach view). The charge for a bed in a dormitory will be S$20. But if you stay at least three nights you will get free movie tickets and bowling at outlets run by Cathay, at least during the promotional opening period.