THE global travel and tourism industry will grow marginally slower in 2013 than previously indicated, according to the World Travel & Tourism Council (WTTC).
WTTC forecasts that the total contribution from travel and tourism to the world economy will be 2.9 per cent in 2013, down from the 3.2 per cent growth initially forecast in February of this year.
The latest economic research shows that the main indicators for travel and tourism are positive for 2013. International tourist arrivals have grown 5.3 per cent in the year from January to August with all regions experiencing some degree of growth, growth appears to be driven mainly by resurgence in arrivals in Europe and (to a lesser extent) the Middle East and airline passenger traffic is up 4.9 per cent overall, and with the exception of Asia-Pacific, performance across hotels remains generally positive with occupancy rates growing across all regions, according to year-to-date data for July.
However, the reduction in growth is driven by reduced investment growth in the economy as a whole, impacting on the industry and slowing global economic growth. Oxford Economics, WTTC’s research partner forecasts global economic growth to be 2.1 per cent in 2013, a slight downgrade from the 2.4 per cent forecast at the start of the year.
David Scowsill, president and CEO, WTTC, said: “Travel and tourism which generates nine per cent of global GDP and supports 260 million jobs, or one in 11 of the world’s jobs.”
As per the research, international tourism expenditure exceeded WTTC expectations with estimated growth of 4.0per cent in 2013. This growth is partially offset however by weaker growth in domestic tourism expenditure and investment, now expected to grow 2.8 per cent rather than the 3.2 per cent predicted at the start of the year. Travel and tourism in South East Asia leads the world with estimated growth of 8.9 per cent, an upgrade from the 6.8 per cent growth predicted at the start of the year, and bucking the trend in many other regions of downward revisions.
Investment spending for the total global economy has been revised down, due in a large part to weaker confidence aggravated by the developments in the US (particularly the tapering of Quantitative Easing and the budgetary cut-backs) and cooling growth in China. Although the travel and tourism investment revision from 4.2 per cent to 3.1 per cent is significant, it has not been downgraded as much as the overall economy due to other positive industry indicators.
Long term growth forecasts of 4.2 per cent per annum growth over the 10 years to 2023 are retained as demand from and within emerging markets will continue to rise in significance.
Scowsill continued: “It is clear that the industry is performing resiliently in the face of continued economic uncertainty, with all regions showing a degree of growth in international arrivals. The economic and social contribution of travel and tourism is well understood across the world, but WTTC calls on Governments of all political persuasions to consider how the value of their industry can be used to drive economic growth and create jobs.”