‘Tourism is a vital sector to the economies of Member States’. So said CARICOM Heads of Government in the communiqué that followed their recent inter-sessional meeting in Georgetown, Guyana.
Taken at face value the statement is unremarkable, even obvious; but the language chosen, its inclusion, and the recommendations made in relation to the challenges the industry faces, suggest that tourism’s significance to the region’s long term economic growth and stability has at last been formally recognised.
Tourism is a sector that has rarely been discussed in depth at the highest political levels of CARICOM. There are many cultural and other reasons why, but over many years much greater importance has been given to industries that are in terminal decline and globally uncompetitive.
Now however, with the active encouragement of the Caribbean Tourism Organisation (CTO) and the Caribbean Hotel and Tourism Association (CHTA), and with the support of several heads of government and tourism ministers, the industry is, it seems, about to be given the attention it deserves at a pan-Caribbean level. At the February 16-17 meeting, detailed proposals aimed at advancing a regional tourism agenda in a strategic way were presented by CTO’s Director General, Hugh Riley, based on a paper jointly developed by CTO and CHTA.
In Georgetown, the region’s leadership embraced the industry, acknowledging ‘the importance of transportation and facilitation of travel, human resource development, the creative industries and marketing as well as competitiveness and financing for the sustainability of tourism’.
In an important new departure, they agreed that public-private sector partnerships, guiding the development and marketing of tourism for the Caribbean, were needed, and had to be more effective.
To achieve this, they agreed to support the establishment of an Interim Tourism Working Group that will include the CARICOM Secretariat, CTO and the CHTA, and have as its mandate the co-ordination of all stakeholder groups to develop solutions to the challenges the industry faces.
The political leadership of the Caribbean has also called for the preparation of a pilot, region-wide public relations and marketing initiative for 2017/2018, for consideration when they next meet in Grenada in July; for the part of the Council for Trade and Development (COTED) dealing with transportation to convene, as a matter of urgency, a meeting to address air transport issues, including those related to the tourism sector; and requested that the future regional marketing of tourism include the eco-tourism product of Belize, Guyana and Suriname.
In a subsequent statement, CTO and CHTA applauded all of this, describing the CARICOM Heads’ decisions as ‘progressive and positive’. They also made clear that they would begin work immediately on developing detailed information on the regional industry’s competitiveness and financing needs, and the other steps required to ensure future sustainability.
If there was any doubt about the challenges Caribbean tourism faces, this was made clear a few days later when CTO revealed the industry’s results for last year.
Although the headline figures were positive, with stop-over arrivals increasing by 4.2% in 2016 to 29.3m – a figure higher than the global average rate of growth of 3.9% for the year – and cruise passenger arrivals up by around 1.3%, to approximately 26.3m, it is clear from the detail that the underlying trends are concerning.
Firstly, growth across the region has been, and is, uneven. While some nations recorded significant increases – Cuba, Turks and Caicos, Guyana and Belize – and others did relatively well, the Dutchspeaking Caribbean and some Anglophone nations saw an average 20% decline in their arrival figures.
Secondly, and perhaps significantly, the raw visitor numbers say very little about the type of traveller, where they went, their length of stay, what they spend, or the economic benefits that each nation retains.
Thirdly, traditional markets such as Canada have weakened significantly, occupancy rates in hotels are in decline, there is increasing pressure from disrupters such as Airbnb to take hoteliers’ market share, and inter-regional travel remains difficult and costly, holding back, for example, the growth of two-centre vacations and inter-regional tourism.
And finally, hotels, which are among the region’s most significant direct and indirect employers, saw a decline in their income compared to 2015. According to Smith Travel Research, all key industry measurements for the region other than the number of available rooms are in decline: in 2016 revenue per available room contracted by 2.6% to US$134.48; occupancy fell by 1.6% to 66.7%; and the average daily rate (ADR) fell by just under a Dollar to US$201.50.
These are worrying developments.
If increasing numbers of visitors decide not to stay in hotels at a time when the region’s overall hotel stock of rooms is growing; if there is strong interest in cruise tourism on larger ships at lower prices; geographically proximate markets like Canada are in decline; and much of the recent positive growth can be attributed to the US opening to Cuba, the longer-term outlook is not that bright.
Today, while some anti-tourism sentiment still prevails in the region, it is evident that the industry has become the one on which almost every nation depends for GDP growth.
As nations from Cuba to Belize have demonstrated, it is an industry that can quickly create employment, generate tax revenues and foreign exchange, and stimulate indigenous entrepreneurial activity. However, to survive it must be fiercely competitive on a global basis, and requires a complex mix of skills and services if a country, or the region, is to succeed in ways that are sustainable.
One answer must be better regional marketing. Unfortunately, in the past, addressing this issue has foundered on the willingness of governments and the industry to make available the resources necessary to promote the region as a whole over other global destinations.
It has also been the case that the industry’s needs, from training to ease of travel, have not yet seeped into the DNA of the many bureaucracies in the region, which by their action or inaction can make or break the industry’s competitiveness.
It is therefore to be hoped that when CARICOM Heads of Government next meet, their welcome understanding of the need to give greater priority to tourism can be rapidly translated into implementable region-wide action.
David Jessop is a consultant to the Caribbean Council and can be contacted at firstname.lastname@example.org Previous columns can be found at www.stagingcaribbean.wpengage.uk February 26th, 2017