World Tourism Organisation Barometer shows steadily improving conditions for International Tourism

The results of the new WTO World Tourism Barometer indicate that international tourism might be close to a turning point. Although the world economy is still rather weak, a change for the better is expected to take place in the second half of the year.

Initial data for 2003 clearly show the effects of the Iraq conflict and the SARS outbreak. Nevertheless, various destinations managed to post surprisingly good results, in particular, some of the recently most-afflicted destinations in the Caribbean, South America, and South Asia. With the uncertainty due to the geopolitical situation gradually falling away, the perspective is switching back towards economic prospects.

One of the innovative elements of the WTO World Tourism Barometer is its Panel of Experts. Over one hundred tourism experts from all over the world consulted during May also confirmed a more positive outlook for the coming period. While the panel gave the previous four-month period, January to April, an average score of 2.8 (on a scale from 1 to 5), the period from May to August was rated at 3.6 (a score of 4 meaning "better"). All regions share expectations of improvement over the four months to come. Prospects for Europe show a notable improvement, although the biggest jump is found in the Middle East.

Africa and the Americas were already upbeat about the past four months and maintain or even slightly improve their expectations for the coming four months. The outlook for Asia and the Pacific clearly reflects the concern over SARS. However, as the outbreak is virtually under control, prospects are also expected to improve quickly in this region.

According to the Secretary-General, Mr Frangialli, the optimism expressed by the WTO Panel of Experts is based on the expectation of a gradual improvement of the economic conditions, the reduction of uncertainty as a result of the relaxation of international tensions, and the waning of SARS.  However, late reservations and noticeable price sensitivity are expected to persist as main market trends.

Tourism performance in 2003

The first part of 2003 has been predominantly a continuation of the 2002 scenario with the long-awaited economic recovery further delayed because of the prolonged uncertainty due to the Iraq conflict. Some destinations, however, started the year with considerable growth (e.g. Caribbean, Asia, United Kingdom and South Africa), but mostly compared to rather depressed levels in the first months of 2002. The start of the war in Iraq in March caused an immediate plunge in demand, particularly in air traffic, interregional travel, and travel to  destinations perceived as close to the conflict zone. Very few destinations and sectors were immune from this new setback.

However, as Mr. Frangialli stressed, a significant difference was that, this time around, national tourism administrations, tourism boards, and tourism businesses were much better prepared and attempted to adapt quickly to the changing conditions. Measures primarily focussed on shifting or reducing capacity and rigorous cost control. In this respect, the emergence of SARS was much more unexpected and disrupted destinations and businesses far more severely. National tourism administrations (NTAs) have backed the sector with rapid action plans in several areas such as communication, promotion and marketing.

Tourism performance by region

Europe: The "wait-and-see" attitude of consumers, induced by the looming war and by the economic prospects in most of the advanced economies, resulted in declines in the majority of European destinations in early 2003.

With the start of the military intervention in March, most countries dived into the minus side. Nevertheless, March figures were also influenced by the fact that the 2003 Easter holiday - considered as the start of the tourism season for many European destinations - fell in April and not in March as it did in 2002. With the disappearance of uncertainty, expectations for  the summer season are reasonable to good, but with late bookings and  pressure on prices.

Americas: Tourism performance in the Americas varied significantly between North America and the rest of the continent. In particular, the United States has obviously been preoccupied with the Iraq conflict, fear of terrorism and the rather uncertain economic situation. The United States, Canada, and Mexico suffered two-digit decreases in March. Many other destinations in the region also saw declines in March, but far less pronounced. The Caribbean is showing  clear signs of resurgence, although this is not yet shared equally by all its destinations. With the significant improvement of the economic prospects in the Mercosur countries, particularly Argentina and Brazil, travel in the region is picking up. Prospects are evaluated positively by the sector, due to the fact that the length of the war was less than expected and signs of a gradual recovery of the economic situation in the United States are emerging.

Asia and the Pacific: The emergence of SARS mid March appears immediately as the main determinant in the evolution of tourism in Asia in the first months of 2003, seriously affecting not only the destinations under the World Health Organization (WHO) travel advisories, but the majority of the destinations in the region. The  results posted over the first three or four months of the year are, almost without exception, negative and particularly striking in comparison to the region's outstanding performance in 2002. The only destinations staying out of the turmoil are those in South Asia and in Oceania. The coming months will definitely still be under the influence of SARS, but with prospects of improvement as the number of newly reported cases and deaths is continuously declining and travel advisories for most regions are being lifted.

Africa and the Middle East: Destinations in the Middle East and North Africa show a rather similar pattern, obviously reflecting the impact of the war in Iraq. For example, Morocco, Tunisia, Egypt, Jordan, Qatar, and Lebanon all started the year with a substantial increase in January. February followed with a more moderate increase, while March  is showing sizeable drops. In April losses were already more limited, with certain destinations posting modest increases. All African countries that reported data for the corresponding months increased in January and February and decreased in March. South Africa maintained the good pulse shown in 2002 (+11%), with an increase of 9% in January and 7% in February. Even during the month of March, when most destinations around the world showed declines induced by the geopolitical tension, the country only saw a slight decrease of 0.3%.

The WTO World Tourism Barometer - a new project by the WTO Secretariat

The WTO World Tourism Barometer is a new activity of the Market Intelligence and Promotion section of WTO aimed at monitoring the short-term evolution of tourism and providing the sector with adequate and timely information. 

The WTO World Tourism Barometer is scheduled to be published three times a year (January, June, and October). It contains three permanent elements: an overview of short-term tourism data from destination  countries and air transport, the WTO Panel of Tourism Experts with a  retrospective and prospective evaluation of tourism performance, and selected economic data relevant for tourism.

The full version of the first issue of Barometer can be downloaded from: www.world-tourism.org