Increasing Confidence in 2010 Recovery for the Tourism Sector
The conditions of the tourism market are starting to indicate stronger prospects for a recovery in 2010. These include macroeconomic upward revisions from the IMF together with preliminary international tourism figures until August this year. This suggests some moderation in the declining results of the first half of this year. In addition, the UNWTO Panel of Experts Confidence Index reflects stronger confidence in market conditions. International arrivals declined by 4 per cent in July this year, a relative improvement when compared to decreases of 10 per cent in May and 7 per cent in June. Many destinations show a similar pattern of a gradual change for the better, particularly in Asia, Europe and the Middle East.
The negative trend in international tourism that emerged during the second half of 2008 intensified in 2009 under the impact of the rapid deterioration of the world economy, combined in various destinations with the effects of the influenza A(H1N1) outbreak this spring. Based on preliminary results from about 140 destination countries, international tourist arrivals worldwide are estimated to have declined by 7 per cent in the period January to July 2009, compared to the same period last year.
In absolute terms, the number of international tourist arrivals worldwide reached 500 million in the first seven months of 2009, down from 540 million in the same period of 2008. Arrivals in 2009 are currently between the levels of 2007 and 2006. The first seven months of the year generally account for roughly 57 per cent of the total annual number.
Though much uncertainty persists, there are signs indicating that the turning point may also have been reached in the tourism sector. Data for July show a relative improvement and for countries that already reported data for August, these two high season months have not in general been as depressed as the first six months of the year. Other industry indicators from air transport and accommodation sectors corroborate this upward trend.
“As the latest economic data and prospects indicate that the world economy may be starting to emerge from its most severe recession of the post second world war period, in tourism too there are signs that confidence is returning and that demand is improving for both business and leisure travel” said Taleb Rifai, UNWTO Secretary-General.
The economic conditions, combined with the uncertainties brought about by the influenza A (H1N1), are expected to continue impacting tourism demand – at least in the short term. As decline rates are anticipated to ease during the remainder of 2009, international tourism is forecast to decrease within a range of -6 per cent and -4 per cent this year. And though many sub-regions might return to growth in the last months of 2009, this will not be enough to compensate for the losses felt so far. Growth for the full year is projected to be negative in all regions, except for Africa.
These results reflect international tourist arrivals only, for which comprehensive data is currently available. Domestic markets, highly important for many destinations and actively stimulated by numerous governments during the crisis, are expected to have done comparatively better. Still, this will not compensate for the losses in international markets. As in previous crises, tourism earnings are expected to suffer somewhat more than arrivals as consumers tend to trade down, stay closer to home and travel for shorter periods of time.
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