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2004 to close with 70 Million more International Arrivals

Travel News Asia 8 November 2004

With still a couple of months to go, it is already clear that 2004 will go into history as a very strong year for tourism. World Tourism Organization (WTO) Deputy Secretary General Dr. Dawid de Villiers said today at the World Travel Market that according to an initial projection, the number of international tourist arrivals is heading for a new all-time record, as growth for the entire year is estimated to reach around 10%.

After three subdued years with an accumulated growth of less than 1%, international tourism is firmly on its way to convincingly bounce back this year. According to the monthly tourism data for the first eight months of 2004 collected by the World Tourism Organization from over 120 countries for the October 2004 issue of the WTO World Tourism Barometer, in the months February to July international tourist arrivals worldwide grew by double-digit figures compared to the same months of 2003, while in January they grew by 9% and in August by 6%. For the entire January-August period growth is estimated at 12%, corresponding to an increase by some 58 million arrivals. Of course it has to be taken into account that this leap is primarily a reaction to last year’s depressed figures due to the Iraq war, terrorism, SARS and the weak economy. Nevertheless, compared to corresponding months of 2002, the previous record year, the increase still amounts to 42 million (+9%).

Results are positive for all regions. Asia and the Pacific, hardest hit by the SARS outbreak last year, led growth with an exceptional increase of 37% in the first eight months of the year, while North America (+12%) returned to positive figures after more than three years of losses. The three other subregions of the Americas maintained the positive performance of the past year, and the growth of the region as a whole is also estimated at 12%. The Middle East (+24%) has convincingly overcome the disruption caused by the Iraq conflict and is reckoned to have recorded almost a quarter more international arrivals up to August. The North African destinations of Morocco and Tunisia have driven growth in Africa and lifted the growth rate of the region to an estimated 9%. Tourism growth in Europe was comparatively more modest, but at a rate of 6%, still quite above the usual rate for the region.

Growth has been strongly fuelled by the pent-up demand resulting from the constraints of the past three years. The long-awaited economic recovery did finally materialize and the geopolitical situation is no longer perceived as much of a problem. Consumer and business confidence is back. The first is clearly reflected in the soaring demand reported by the various destination countries, with leisure tourism still performing stronger than business tourism, although the latter is also picking up. Furthermore, 2004 has shown a gradual recovery of long-haul traffic, which is noticeable in stronger demand for air transport on overseas routes, premium accommodation, and in visits to world capitals. The cruise industry continues to perform extraordinarily well. The return of business confidence is confirmed by the evaluation of tourism performance by the participants of the WTO Panel of Tourism Experts, which has consistently been on the rise since the beginning of 2003. One noteworthy development is the marked improvement in both the evaluation and the prospects expressed by representatives of the activities of Transport, Accommodation & Catering and Tour Operators & Travel Agencies reported in the latest issue of the WTO World Tourism Barometer.

WTO Deputy Secretary General Dr. Dawid de Villiers said: “We knew that prospects for 2004 were good, but the strength of the rebound has even surprised us. We are confident that the tourism sector is back on the right track after three difficult years. It is encouraging to see that destinations and industry have regained confidence. Once again the tourism sector has shown its extraordinary resilience and its ability to overcome difficulties, and in many cases it has even emerged stronger.”

Outlook for the remainder of 2004 and 2005

During the remainder of 2004 growth is obviously expected to slow down, as the baseline figures corresponding to the last four months of 2003 are already much stronger. The estimates for the first eight months of the year are of course quite exceptional and can only be judged correctly in the light of the negative or very weak figures recorded in the same period last year. Nonetheless, even compared to 2002, all regions still show positive figures. Asia and the Pacific’s current results up to August are still 17% higher than the first eight months of 2002, the Americas are up 7% and Europe 5%, while the Middle East and Africa in 2003 already equalled or surpassed 2002 results.

A projection based on the data available for the first eight months, combined with a fairly conservative estimate for the remaining four months of 2004, indicates growth for the full year of 2004 of close to 10%. The last time a comparable percentage has been recorded was 20 years ago in 1984, when international tourism recovered from the persistently weak economy of the early 1980s due to the second oil crisis. In absolute numbers the increase corresponds to an estimated 65 to 70 million more arrivals. All regions will share in this increase, although not to the same extent. Almost half of all new arrivals will be recorded in Asia and the Pacific, which already took a share of 27 million of the 58 million new arrivals up to August. Europe, which is indeed growing at a slower pace but on a much larger base, will record the second largest share (16 million more arrivals already in the first eight months). The Americas, the Middle East and Africa, which respectively gained 9 million, 4 million and 2 million international arrivals up to August, will together take about the same share as Europe. The WTO is to present an in-depth analysis of 2004 in the January 2005 issue of the WTO World Tourism Barometer scheduled to be issued at the end of January on the occasion of the Spanish tourism fair FITUR.

For 2005 expectations are more moderate. The first challenge will be to consolidate this year’s bumper results. One of the major questions is how much pent-up demand is still in the pipeline. Leisure tourism is expected to sustain its growth, while business tourism will recover further. The economic conditions are favourable. Healthy economic growth is anticipated for both established and emerging source markets, inflation is contained and interest rates have not yet risen much. High oil prices are a factor of concern, but so far, they have not greatly affected the economy at large or tourism in particular. For international tourism at this point in time, worldwide growth is anticipated to meet or just slightly undershoot the WTO long-term forecast of 4% a year.

According to WTO Deputy Secretary General Dr. Dawid de Villiers, “It appears that tourism business is very much back to normal and we expect to see that trend reinforced in the year to come. An interesting finding from the last survey of the WTO Panel of Tourism Experts is that a clear shift could be observed from a focus on external factors and crisis management back to a renewed focus on the internal competitive factors of destinations and products such as product development, training and promotion.”

See other recent news from: World Tourism Organization

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