New Tourist Spending Trends Report Shows Visa Cardholders Spent US$17.3 billion During Visits to Asia Pacific Countries in 2003

Visa cardholders visiting Asia Pacific countries are spending more than ever, purchasing goods and services worth US$17.3 billion in 2003, up from US$16 billion in 2002 and US$14 billion in 2001, according to a comprehensive new report examining trends in regional tourism spending, released today by Visa.

The new report, entitled "Recent trends in spending by visitors to Asia Pacific", provides insights and data that can be used by merchants and policy makers to determine the goods and services they offer, the markets they should target, how they should present goods and services, and how they might better insulate their businesses from market downturns.

The report shows that the two largest spending countries of origin in the region in 2003 were the United States (US$3.26 billion) and the United Kingdom (US$2.62 billion). These countries are followed by Japan (US$1.81 billion), Hong Kong (US$1.07 billion) and Australia (US$970 million). In total, these top five locations accounted for 56 percent of the total Visa Asia Pacific spend by international cardholders. The highest spend on a per transaction basis was by cardholders from China (average US$253 per transaction). By comparison, the United States and United Kingdom averaged US$135 and US$141 per transaction respectively.

"Tourism is the fastest growing economic sector in terms of foreign exchange earnings and job creation. Global tourism is the world's largest export earner and an important factor in the balance of payments of most nations," said Visa Asia Pacific Executive Vice-President, James Murray.

"Last year, nearly 90 million travelers visited Asia Pacific. This report captures detailed data from Visa's vast payment network that allows a thorough analysis of tourism spending trends around the region. The information will give the region's governments, tourism authorities and other interested parties a better understanding of who their overseas visitors are and on what they are spending, and in doing so, help improve tourism activity and economic growth in the region."

The report highlights the trend of cardholders shopping for a diverse range of goods and services in different countries. For example, spend by Visa cardholders at arts and craft stores in China has been growing steadily over the last five years, in Hong Kong international Visa cardholders spend more on clothing, while in Australia cardholders spend more on education services relative to other destinations in Asia Pacific. Electronic and computer-related goods are relatively popular in Japan and Singapore.

On a per transaction basis, in Australia, New Zealand, Thailand, Singapore and Malaysia, education attracted the highest spend. In contrast, in Hong Kong it was household goods that topped this category; in Japan it was accommodation; and in China, mail order transactions attracted the highest spend per transaction in 2003.

Online transactions account for a minority of tourism-related spending. On average, 91 percent of the US$17.3 billion international Visa spend in Asia Pacific (US$15.7 billion) occurred in person between cardholders and merchants, as opposed to over the telephone, Internet or through mail-order transactions.

The growing importance of intra-regional tourism to Asia Pacific countries was also highlighted, with Asia Pacific-based cardholders making up 45 percent of the total Visa spend in 2003, up from 39 percent in 1999. In the same period, the proportion of total Visa card spend in the region by cardholders from North America and Europe declined from 58 percent to 53 percent.

Murray said, "The interesting feature about the tourism industry is that intra-Asia travel is a good barometer for the health of the global travel industry - a strong intra-Asia travel market means a strong global industry. What this report shows is a healthy Asian tourism industry."

Other key spending patterns identified in the report include:

-Retail stores (US$4.22 billion) and accommodation providers (US$3.26 billion) attracted 59 percent of Visa Asia Pacific spend by international cardholders, followed by sports and leisure activities, transportation, and restaurants and food.

-Across the region, the report found that education goods and services produced the highest average spend per transaction (US$661), followed by accommodation services (US$214) and transport services (US$202).

-The most popular destination markets for in-person VISA spend in 2003 were Australia (US$3.31 billion), Thailand (US$2.05 billion), Hong Kong (US$1.33 billion), Japan (US$1.28 billion) and China (US$1.19 billion).

"Visa's analysis of tourism spending represents a key element of our commitment to support the Asia Pacific region to strengthen its competitiveness in attracting tourists. Going forward we will continue to work very closely with tourism bodies around the region as well as our wide network of merchants to stimulate tourist inflow and spending in the region," Murray said.