NTOs review projections

RISING fuel costs and global economic concerns are sending tourism offices to have another look at their projections.

LA INC, the Los Angeles Convention & Visitors Bureau, said it was reviewing its arrival projections from long-haul markets. At the same time, it has expressed optimism that traffic from China will still be moving, if only because the US has just opened its doors to Mainland China tour groups.

“Due to the recently signed MOU, there’s a pent-up demand to travel to the US at the moment,” said Jamie Yang Lee, LA INC director for China. They have grounded expectations though. “We feel that the quality of travel products would be affected such as the receiving operators would put the group in less expensive hotels, reduce meal allowance and create more tour options and shopping,” she said.

As of June, New Zealand’s arrivals fell by about two percent based on the same period last year. Tourism New Zealand (TNZ) chief executive, George Hickton, traced this to “global economic uncertainy” and “US election”. The country’s arrivals from the US fell by about 12 percent year-on-year.

The NTO is pinning its hopes on its neighbour and biggest source market to even out the figures. TNZ will launch “What’s On” in Q3, which targets Australia, in partnership with regional tourism organisations.

The escalating cost of fuel will definitely have an impact on the long-haul market but for less obvious reasons. While the price tag on travelling is hard to overlook, Enrique Ruiz de Lera, National Tourist Office of Spain director for South-east Asia, Australia, New Zealand and India, said that Spain’s market is divided by those that are price-sensitive and those that are not. So they could still expect movements from the latter.

He stressed that what could really affect travel movements is if more carriers decide to their frequency in reaction to the rising cost of fuel.

Another concern for him is the growing consciousness of environmental issues.

Long-haul travel is starting to be viewed as being environment-unfriendly by some people, including travellers from Australia and New Zealand. In 2007, Ruiz de Lera’s area of responsibility sent about 250,000 travellers to Spain. The biggest came out of Australia at 60,000.

“Some people think twice, even for corporate or business trip to Europe,” he said.

Spain attracted about 60 million visitors last year, 80 percent of these from short-haul markets.

The Hong Kong Tourism Board (HKTB) is sticking to its original eight-percent growth in arrivals by year end. “In calculating the 2008 yearly visitor arrivals projection, the HKTB already considered thoroughly the possible impact of a strain of market factors including the slowdown of the world economy, fuel price increase, inflation, the Olympic Games,” a spokesperson said.

HKTB is projecting to receive 30 million visitors by 2008.

From January to June 2008, Hong Kong received more than 14 million visitors which represented an increase of nine percent over the same period last year.

“Based on the current growth trend, we are cautiously optimistic about reaching the forecast,” the spokesperson said. “The HKTB also included in its yearly business plan summer booster promotional campaign targeting the Mainland China and other short-haul markets, so as to minimise possible impact brings upon by these market factors.”

Having said this, HKTB stressed that the tourism industry is vulnerable to changes in the external environment and, as such, it will continue to monitor the market conditions closely, so as to adapt the strategies and strength of its overseas promotions flexibly.

Australia received 2.3 million arrivals during the first five months of the year, a similar trend year to-date. Of these, a total of 373,000 came from China (which posted a 12-percent growth year-to-date), Korea, Hong Kong and Taiwan.

“From a global perspective, Australia is considered a dream destination by international travellers and it is our continuing challenge to turn that desire into reality. Addressing the issue on high traveling cost, it has been happening not only to Australia, but to every destination around the world. In terms of travelling, cost such as fuel price, currency appreciation and inflation have also been increasing significantly, which may affect people’s travel intention, particularly on long-haul journey,” said Brian Boote, Regional Marketing & Insights manager, North Asia.

TA is batting for a conservative onepercent increase in its arrivals by year-end. Australia’s visitor arrivals in 2007 hit 5.6 million.

“TA has been developing innovative and effective marketing campaigns to trigger people’s intention to visit Australia,” he said, adding that a global tourism marketing campaign was recently announced leveraging on the movie, Australia.