The Perfect Storm

Caribbean tourism is caught in the perfect storm. Tourism, the lifeblood of many Caribbean economies, continues to show strong resilience despite the many challenges that the vulnerable industry has been forced to endure as a result of a number of unprecedented and spiralling events over the last two years. London-based World Travel & Tourism Council (WTTC)  Jean-Claude Baumgarten said its overall optimistic assumptions for the tourism industry seems to be panning out. “Which means, we’re looking at a difficult 2003, as opposed to a disastrous 2003 for most countries. It seems strange to be happy treading water, but it could have been much worse.” . Long term, the WTTC is confident that the resiliency of Travel & Tourism will bounce back. Top line forecasts for the next ten years show a 4.6 per cent annualised real growth of demand; 3.6 per cent real growth in Gross Domestic Product and a 2.2 per cent growth in employment. Likening the current global environment to a “Perfect Storm” - a combination of terrorism, consumer wariness and bad economy, war impact and SARS - “ we’re being hit by waves of enormous size and they are coming from every direction.”

Baumgarten added, “ Just like the perfect storm in the North Atlantic that took its toll, claimed its victims and created its heroes, this perfect storm will do the same. Some of our colleagues have closed their doors and some will be stronger for having survived. But just like the real perfect storm, this one too will blow itself out.”  With the devastating 9/11 terrorist events in the United States, Gulf War 11 and SARS, the fall-out in the tourism industry in the Caribbean has been catastrophic to say the least; resulting in the closure of guest houses and hotels and the spin-off effects these have had on employment, both direct and indirect and on the general economy. But the worst may yet be over. The Caribbean Tourism Organisation (CTO) in its latest outlook for 2003 is optimistic that Caribbean tourism now appears to be past the lowest point of the downswing and showing signs of recovery. “ In short, there are clear possibilities for further growth in the near term. The international travel industry has once again demonstrated its resilience and the Caribbean tourism sector appears set for continued recovery in 2003,” according to the CTO. The weakened US dollar has also made the region’s tourist prices more attractive for Europeans and Canadians, while making trans-Atlantic travel more expensive for Americans and encouraging more of our North American neighbours to consider the Caribbean as an alternative destination. According to the CTO’s figures, tourist arrivals to Caribbean destinations during winter 2003 from January-April increased by an estimated seven per cent over winter 2002.

The Caribbean registered an overall increase of around seven per cent in arrivals from the United States while arrivals from Canada increased by an estimated 21 per cent. The European market is also showing signs of recovery from dramatic declines with arrivals registering overall growth of six per cent during the first three months of this year. Cruise passenger visits during winter 2003 increased by an estimated five per cent. The highest increases continue to be recorded among destinations in the Western Caribbean due to the relocation of cruise ships back to the US due to the 9/11 attacks.  The trend is also reflected in the sharp increases recorded by the new cruise destinations of Turks & Caicos and Belize. Tom Murray, Americas Vice President of InterContinental Hotels said the Caribbean region is well positioned to take advantage of the inevitable upturn in the travel and tourism market. Speaking at the recent annual Caribbean Hotel Industry Conference (CHIC) in Punta Cana, Dominican Republic, Murray said the region’s proximity to its major inbound market, the United States, its viability as a long-haul destination for European customers, the safety factor and politically stable governments will each contribute to the Caribbean recovery. “But perhaps the best thing the Caribbean has going for it, is the opportunity to brand this region as a whole,” he said, explaining that brands, branded companies and branded destinations will be well-positioned to flourish when the tourism industry rebounds.

The Caribbean Hotel Association Charitable Trust (CHACT) has launched a US$16 million Life Needs the Caribbean brand campaign to market and promote the Caribbean as a single destination. Murray said by accentuating the positive characteristics of the region, understanding the importance of branding, and keeping the focus on guests, “we can ride out any storm ... and emerge more successful than ever when the skies do, eventually, clear up.” CTO’s Secretary General Jean Holder is already planning ahead for the new dawning of the Caribbean tourism industry by promoting Sports Tourism as a new niche market in diversifying the traditional product of sun, sea and sand. Sports Travel Magazine estimated in 1998 that sports-related travel and tourism market is worth US$118.3 billion. Closer to home, a CTO survey of departing visitors after a Test Match in Barbados in the 1998 West Indies/England Cricket series, showed some outstanding economic results. During the week immediately after the game some 8,300 or 15 per cent of departing visitors in the survey, indicated that they had come to Barbados for cricket. With an average stay of 10 days, these visits translated into US$24 million to the Barbadian economy. “ The tourism industry has therefore been challenged to provide year round jobs for its employees and a more even stream of revenue. This means that, given the growing dependence on tourism as an economic sector, empty hotels after May, financial droughts in September and October and lay-offs of staff for significant periods, are no longer acceptable,” said Holder. He said the Caribbean must understand the “incredible opportunities and challenges” posed to the Caribbean when it hosts the 2007 World Cup Cricket Series in which sixteen teams from around the world will be engaged in competition for 40 days.