International tourism: recovery confirmed, growth remains uneven

International tourist arrivals grew by seven per cent in the first four months of 2010, according to the latest issue of the United Nations World Trade Organisation (UNWTO) World Tourism Barometer. This growth confirms the recovery trend beginning in the last quarter of 2009 and comes despite the challenging conditions of recent months.

While April's results were affected by the weeklong closure of European airspace, globally, the pace of recovery is faster than initially expected, driven largely by emerging markets. For the full year 2010, UNWTO forecasts international tourist arrivals to grow by three to four per cent

2010: January-April results

International tourist arrivals increased by seven per cent in the first four months of 2010. The three per cent increase registered in April marks the seventh month of growth in international tourist arrivals after 14 consecutive months of negative results. Still, growth slowed down slightly in April as a consequence of the closure of European airspace for a week, due to the ash-cloud following the eruption of a volcano in Iceland. Although only around 30 countries have reported May data, the vast majority are positive, clearly pointing to a continuation of the current pace of growth.

The overall positive trend during the first four months of 2010 is reflected in the rise of the UNWTO Tourism Confidence Index. Fifty per cent of the experts participating in the UNWTO Panel of Tourism evaluate the period January-April as "better" or "much better". This compares to 34 per cent for the period September-December 2009 and is the best rating since January-April 2008 - before the onset of the global economic crisis.

Positive outlook, challenges remain

UNWTO maintains its January forecast for international tourist arrivals in 2010 at +3 per cent to +4 per cent. Current growth rates suggest that end-year results are likely to be closer to four per cent, and may even exceed it. Much depends on the results of the upcoming summer high season in the northern hemisphere, particularly in Europe.

As the peak tourism season for the world's leading regions in the northern hemisphere starts, short-term prospects are promising. The UNWTO Confidence Index for May-August 2010 is even higher than the one for January-April 2010.

Nevertheless, challenges remain and the sector still has a long way to go to make up lost ground. Increasing unemployment continues to be a major cause of concern and, as anticipated by UNWTO, it is now clear that public deficits represent a clear challenge.

This is particularly relevant for advanced economies and could affect leading outbound markets. The phasing-out of stimulus measures, combined with austerity measures and the rise in taxation introduced by many governments, have become main factors to be considered. The tourism sector itself may be confronted with increased taxes, given the expected rise in United Kingdom departure tax (November 2010) and Germany's intention to introduce a new air tax as part of its budget-cutting plans. UNWTO cautions against the potential adverse effects of one-sided decisions on taxation which might harm the tourism sector.