THE World Travel & Tourism Council (WTTC) revealed the results of its 2009 Economic Impact Research at the ITB Berlin last month.
'This year, the task of assessing travel and tourism trends and drawing up forecasts has been more challenging than ever because of all the uncertainties,” Jean-Claude Baumgarten, WTTC president and CEO said.
WTTC’s latest research shows that the travel and tourism economy GDP will contract by 3.6 per cent in 2009, and is expected to remain weak in 2010 with only marginal growth, of less than 0.3 per cent.
“Lower fuel costs will make a difference,” said Baumgarten, “as will lower general inflation, which should reverse part of last year's squeeze on households' spending power. But given how widespread and deep the current recession is, it is inevitable that travel and tourism will continue to be affected.”
'Indeed, as a relatively cyclical industry, its contribution to world GDP is expected to fall further in the next two years - from 9.6 per cent in 2008 to just over 9 per cent in 2010,” Oxford Economics' managing director, Adrian Cooper, added. 'Job losses are likely to be significant, with employment falling by around 10 million over the next two years towards 215 million in 2010, before recovering thereafter.”
A key message from WTTC is that travel and tourism is a major contributor to job creation and poverty alleviation - “a fact that policy-makers would do well to recognise and take into account in their short to medium term strategies,” said Baumgarten.
“The industry is not expecting a bail-out. It needs a supportive framework from government to help it weather the current storm. And governments would also do well to recognize travel and tourism’s potential to energise the economy once the current crisis eases,” he said.
Travel and tourism investment and corporate travel are expected to be the hardest hit this year. Real investment spending is forecast to decline by five per cent in 2009 and a further 1.25 per cent in 2010.
Residents’ travel and tourism spending is likely to be the least affected, but even here a decline of 2.75 per cent is projected for 2009, despite the substitution of domestic for some foreign travel.
'Nevertheless,' said Baumgarten, 'looking beyond the current crisis, travel and tourism is expected to resume its leading role in driving global growth, creating jobs and alleviating poverty.”
'Emerging economies are expected to be the main engines of growth,' Baumgarten added, 'generating hundreds of millions of new travellers from among the growing middle classes in countries like China, India and Brazil - boosting international travel, but also creating an increasingly vibrant domestic tourism sector.'
In developed countries, the increasing priority given to leisure activities can be expected to enhance demand for travel to existing and new tourism destinations once consumers regain confidence, while the popularity of short breaks - both domestic and international - will continue to expand in the medium to longer term.
Overall, the travel and tourism economy is forecast to grow by four per cent per annum in real terms over the next 10 years. By 2019, travel and tourism will account for 275 million jobs, representing 8.4 per cent of total employment across the world.