The global Travel & 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 & Tourism to the world economy will be 2.9% in 2013, down from the 3.2% growth initially forecast in February of this year.
The latest economic research shows that the main indicators for Travel & Tourism are positive for 2013 with international tourist arrivals have grown 5.3% 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 while airline passenger traffic is up 4.9% 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 in Travel & Tourism 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% in 2013, a slight downgrade from the 2.4% forecast at the start of the year.
David Scowsill, President & CEO, WTTC, said the Travel & Tourism is a growth industry which generates 9% of global GDP and supports 260 million jobs, or 1 in 11 of the world’s jobs. “In 2013, Travel & Tourism total contribution to GDP is expected to grow at 2.9% according to WTTC’s latest estimates.
This is lower than our previous forecasts but a much higher level of growth than the 2.1% expected for the global economy and continues to show the strength and resilience of the Travel & Tourism industry.”
Highlights of the latest research include:
International tourism expenditure exceeded WTTC expectations with estimated growth of 4.0% in 2013, compared with our previous estimate of 3.1%. The growth in international tourism expenditure is partially offset however by weaker growth in domestic tourism expenditure and Travel & Tourism investment, now expected to grow 2.8% rather than the 3.2% predicted at the start of the year.
Travel & Tourism in South East Asia leads the world with estimated growth of 8.9%; an upgrade from the 6.8% 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 & Tourism investment revision from 4.2% to 3.1% is significant, Travel & Tourism investment has not been downgraded as much as the overall economy due to other positive Travel & Tourism indicators.
Long term growth forecasts of 4.2% per annum growth over the ten years to 2023 are retained as demand from and within emerging markets will continue to rise in significance. Travel & Tourism will continue to grow, outpace growth of the wider economy and remain a leading generator of jobs.
“It is clear that the Travel & Tourism industry is performing resiliently in the face of continued economic global uncertainty, with all regions showing a degree of growth in international arrivals. The long-term prospects are positive with growth of around 4% for the next 10 years maintained,, added Scowsill.
“The economic and social contribution of Travel & 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.”