2009 has seen the worst recession since the
1930s, with global GDP contracting by an estimated 1.3%. While
there are tentative signs that the economic cycle is now turning,
driven by unprecedented policy stimuli, reviving credit markets
and recovering asset prices, recovery is expected to be gradual –
and a second dip into recession early next year cannot yet be
"As a result, travel and tourism
economy GDP is
now forecast to decline by 5.5% in 2009," said Jean-Claude Baumgarten, President & CEO of the World Travel & Tourism Council
(WTTC), announcing WTTC's latest forecasts at the World Travel Market
in London this week. Baumgarten was joined by Adrian Cooper, Managing
Director of Oxford Economics, WTTC's research partner.
"This means that travel
and tourism's contribution to global GDP
will fall this year to less than 9.3% from 9.6% in 2008," Baumgarten noted, "and this is also down from the 9.4% predicted
at the start of 2009."
"Moreover," he added, "activity in
2010 is likely to be flat at best."
updated forecasts from WTTC and Oxford Economics show that there
has been no change in the projected long-term trend growth of 4%
per annum forecast for travel and tourism over the coming decade,
making it a key engine of expansion in the longer term.
the aftermath of the financial crisis that started last summer,
the global economy contracted at its steepest rate in post-war
history," said Adrian Cooper. "However, recent indicators suggest
that the global economy has passed its trough and some forecasts
for 2010 are now being upwardly revised."
"Key recovery drivers are
unprecedented monetary and fiscal stimuli, reviving
credit markets and recovering asset prices," Cooper
explained. "But there are good reasons for caution and a
second dip into recession early in 2010 – what we call
the double-dip scenario – cannot yet be ruled out."
Travel and tourism economy GDP
growth in 2008 slowed to 1%, according to WTTC, as significant
momentum was lost in the second half of the year, and the
deterioration intensified early in 2009, resulting in:
International air passenger traffic contracting by 6% year on year
in the first eight months of 2009;
• Monthly data for 68 countries
covering 80% of global tourist trips showing overnight visitor
arrivals on a similar path (January to September growth is
estimated at 6% year on year); and
• Widespread losses across all
regions, although currency effects and domestic tourism have
provided some support.
Nevertheless, there are tentative
recovery signs for the industry with the most recent data
indicating that the worst has passed. Given the
deeper-than-expected global recession and tourism indicators for
the year so far, the contraction in travel and tourism activity is
now expected to be larger than anticipated in January. Corporate
travel cuts, household curtailment of leisure travel (especially
international trips) and the postponement of investment plans for
tourism infrastructure have all been as bad as expected.
"Travel and tourism clearly continues to face challenging times,"
said Baumgarten, "especially if the tentative recovery underway
loses momentum or if the A(H1N1) influenza pandemic were to
intensify and become more virulent."
"In the face of such
difficult circumstances, travel and tourism requires the global
policy environment to be supportive," Baumgarten stressed.
"Policy-makers therefore need to be wary about placing extra
burdens on this previously dynamic sector at this crucial time
when profitability is already under severe pressure."
the challenging times facing travel and tourism are ignored by
governments," he said, "then its role in employment creation and
poverty reduction could be seriously undermined."
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