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Tourism banking on recovery

Posted by CaribShout on August 27, 2009 at 9:00pm

Signs that the international recession may be bottoming out has led to cautious optimism in Caribbean tourism circles that the worst for the industry is over. In stock markets in Europe this week, for example, many exchanges hit 2009 highs on rising hopes for economic recovery. "We are confident now that the bottom of this recession seems to be in sight," said Hugh Riley, the newly-confirmed secretary general of the Caribbean Tourism Organisation (CTO). The downturn had led to a difficult 12 months or so for tourism in the Caribbean, with visitor numbers falling in most markets. But Mr Riley told BBC Caribbean that a survey this month of airlines and tour operators revealed that enquiries about Caribbean travel had increased. He hopes that these materialize into bookings before long. "We still have the challenge of getting through the next few weeks before the winter (season) begins," he cautioned. "But we do believe we have reason to be optimistic." Profits decline In its latest tracking data report, the World Tourism and Travel Council said the pace of contraction globally had moderated across all regions, but said that arrivals were still down 6.1% on a year ago. Caribbean hotel

Some hotels have been forced to cut rates to survive the downturn In the Caribbean, the International Monetary Fund has predicted that revenues from tourism - a key earner for several nations - could fall by an average 15% this year. Last week, an Atlanta-based company, PKF Hospitality Research said the region's hotels had an average drop in profits of 16% in 2008 and there will be "further profit deterioration" this year. The report found that steep discounts and special offers did not offset a 4% decline in visitors to the tourism-dependent area. The PKF report also predicts that about 50 planned hotel projects are likely to be delayed because developers are struggling to source financing. It noted that a number of hotels have been forced to close, including the Four Seasons on Great Exuma in the Bahamas. At least there is good news for that resort - the Jamaica-based Sandals said it would buy the high-end 500-acre property and reopen it in January 2010. Price cuts Sandals Chief Executive Officer Adam Stewart said: "It has been a very tough year for everybody ... but our company will definitely come back stronger when things come back." "The challenge for us is to ride out this wave," Antigua and Barbuda's Tourism Minister John Maginley told the Miami Herald. "We think people will come back." The industry has been forced to offer incentives, including hotel discounting and free airport transfers, to entice visitors. Mr Riley says this has helped the Caribbean "to hold our own." "(CTO) member countries have, for the most part, remained visible, vocal, and have aggressively promoted themselves," he said. The region has certainly had to make a lot of noise over what it believes is its harsh treatment under Britain's soon-to-be-increased air passenger duty.. Beach construction

Some building projects have been put on hold Caribbean nations and UK airlines predict that the level of the tax on flights to the Caribbean will lead to a sharp downturn in travelers. In a report, industry specialist paper Aviation Daily said: "The CTO is all too aware of the likely consequences, having lost an estimated $100m in tourism revenue since 2007 following the implementation of a new US policy to require its citizens visiting the Caribbean to have a passport." New flights Jamaican Prime Minister, Bruce Golding, has led high-profile figures in lobbying British parliamentarians for a change in the classification criteria. Tourism ministers have also been active in seeking an expansion of American pre-clearance facilities to provide quicker immigration clearance for US visitors. Border pre-clearance is currently in place at four airports in the Caribbean and Atlantic - Aruba, Freeport and Nassau in the Bahamas, and Bermuda. Despite the relative gloom, some airlines have also announced new flights to the Caribbean, adding to its visibility in the marketplace. The latest is the low-cost carrier AirTran Airways which has filed applications with the US Department of Transportation to offer flights to Nassau, Bahamas, and Aruba from American cities. Mr Riley believes the region has used the downturn as usefully as it can. "We've been studying consumer behavior, trying to figure out what our best customers are doing, how they are seeing our product ..." The hope is that this information will help the Caribbean prepare much better for when the economic turnaround finally takes hold.

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