european tourism 2011 - trends & prospects

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A quarterly insights report produced for the Market Intelligence Group of the European Travel Commission (ETC) by Tourism Economics (an Oxford Economics Company)


  • 1.EUROPEAN TOURISM 2011 Trends & ProspectsQuarterly Report - Q4/2011

2. EUROPEAN TOURISM in 2011:TRENDS & PROSPECTS Quarterly Report (Q4/2011)A quarterly insights report produced for the Market Intelligence Group of the European Travel Commission (ETC)by Tourism Economics (an Oxford Economics Company) Brussels, January 2012ETC Market Intelligence Report 3. Copyright 2012 European Travel CommissionEuropean Tourism in 2011: Trends & Prospects (Q4/2011)All rights reserved. The contents of this report may be quoted, provided the sourceis given accurately and c learly. D istribution or reproduction in full is permitted forown or internal use only. While we encourage distribution via publicly accessiblewebsites, this should be done via a link to ETCs corporate website,, referring visitors to the Market Intelligence Section.The designations employed and the presentation of material in this publication donot imply the expression of any opinions whatsoever on the part of the ExecutiveUnit of the European Travel Commission.Published and printed by the European Travel Commission19A Avenue Marnix (PO Box 25), 1000 Brussels, BelgiumWebsite: www.etc-corporate.orgEmail: [email protected] No: 978-92-990059-4-1This report was compiled and edited by:Tourism Economics (an Oxford Economics Company)on behalf of the ETC Market Intelligence GroupPhoto : Bruno Medley - Fotolia.comEuropes tallest Christmas tree, Lisbon, Portugal. 4. European Tourism: Trends & Prospects (Q4/2011)1Foreword Last year will prove to have been a r ecord year for travel to Europe.Travel in Europe International visits are on pace to grow 6% for the year, surpassing the recovered fully inpeak set in 2008. The recovery is broad, with nearly every destination 2011... posting growth for 2011. Through November, European airlines served 5% more passengers than in 2010 and continue to expand access by adding capacity. Hotels also ... with airlines and indicate strong performance with a 3.2% gain in occupancy and a rate hotels postingincrease of 2.7% through November.strong growth. Not surprisingly, travel to European destinations has slowed in recent months. The combination of fiscal austerity and f inancial market stress brought about by the Eurozone debt crisis is affecting both consumer and However, both business behaviour. And, as discussed in this report, the spectre of aEurope and the global recession is not an insignificant risk as even emerging marketsworld are entering a have begun to slow.period of economic As a result, both regional and long haul travel markets face stiff headwindsweakness... over the next two years. Tourism Economics now forecasts visits to all of Europe are expected to decline just over 1% in 2012 and with just moderate growth of 0.8% expected for 2013. Countries in the EU are expected to experience the brunt of the contraction, especially Western and Southern Europe. presentingchallenges that will In consideration, our partnership is all the more important as we navigaterequire a concertedthe turbulent road head. These challenges require our commitment to workresponse.together to promote all of Europe to the world. We trust you will find the analysis in this report helpful as you track your own destinations performance and seek to anticipate future trends. Best wishes, Leslie Vella Chairman ETC Market Intelligence Group European Travel Commission, January 2012 5. 2European Tourism: Trends & Prospects (Q4/2011)Executive Summary Europe: Overnight Visitor Arrivals Travel to European destinations in 2011million600has exceeded the prior peak set in 2008. Impressively, 22 of 23 reporting countries500Previous Peak, 2008, 494 millionshow international visitor growth in 2011,ranging from 3% in the UK to more than400Non - EU20% in Latvia and Lithuania. And 24 of26 countries show gains in hotel300occupancy in 2011. EU200 Total international visits are estimated tohave surged 6% last year, while hotel 100occupancy rates rose 3.2%, indicatingthat domestic demand lagged behind0international demand.2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011Source: Tourism Decision Metrics / UNWTO While the travel recovery has been quiterobust, signs of eroding gains began toappear, as expected, in the second half of2011.Foreign Visits to Select Destinations 2011, year-to-date*, % change year ago Data on visitation and nights from 25TourMIS( as20well as hotel and airline industry dataprovide a consistent picture of the15pullback on growth in recent months. 10 Three forces converged to bring about5this late-year trend: reversion to the meanfrom the ash cloud rebound in the first half 0 Montenegro RomaniaSlovakia Netherlands EstoniaAustria Latvia Malta CyprusHungaryBulgaria CroatiaItaly Lithuania SpainSlovenia Czech Rep. GermanyUKSerbiaBelgiumof the year; the second half of 2010 was-5relatively stronger than the first half socomparisons in 2011 were to a higherbase; and the Eurozone debt crisis beganto affect both consumer and businessSource : TourMIS, ETC, *date varies (Aug-Dec) by destinationbehaviour. The financial crisis in the Eurozone hascontinued to worsen in recent months.Problems in sovereign debt markets havespread from Greece, Ireland and Portugal Hotel Performance, Jan-Nov 2011to Spain and Italy posing a much more% change year ago10 OccADR () RevPAR ()severe threat of global financial contagion. 9 If the Eurozone authorities fail to arrest 8the alarming slide in financial and7business confidence, the consequences6would be severe. In the event of a 5Eurozone break-up, GDP could initially fall4by around 10% in the exiting countries 3and the attendant financial disruption 2would plunge much of the world, including 1the United States, back into recession. 0 Europe Eastern Northern SouthernWesternEuropeEuropeEurope Europe Source : STR Global European Travel Commission, January 2012 6. European Tourism in 2011: Trends & Prospects (Q4/2011) 32011 Tourism Performance SummaryThe expected late-year slowdown of travel to Europe came to fruition. Availabledata for visits and nights, and hotel and airline industry data all point to the samestory: the recovery of travel and tourism across Europe is fading. Arrivals andnights growth has tailed off for approximately 75% of destinations. Hoteloccupancy in Europe has increased 3.2% through November, but has slippedsince August.2011 Performance, Year to Date Tourist Arrivals and Nights Hotel Performance, Jan-NovInternational ArrivalsInternational NightsHotel Occupancy Hotel ADR (LCU)Country% ytd to month Country% ytd to month Country% ytdCountry% ytdLatvia 20.8 Sep Bulgaria19.9 SepIceland 18.6 Turkey 29.8Lithuania20.3 Sep Lithuania 19.5 SepEstonia 17.6 Lithuania15.8Estonia15.6 Oct Latvia17.7 SepLithuania 13.9 Estonia11.5Romania12.4 Oct Estonia 17.2 OctSlovakia 9.3 France6.6Ireland Rep12.3 Jun Sweden14.7 NovRomania8.5 Poland6.5Serbia 12.1 Nov Spain 13.7 NovCzech Republic6.7 Iceland5.8Cyprus 10.2 Nov Serbia13.6 NovSpain 5.7 Portugal 5.7Slovakia 10.1 Sep Montenegro12.0 NovHungary 5.5 Ireland5.2Slovenia9.0 Oct Portugal11.2 OctMalta 5.5 Netherlands5.0Czech Rep.8.5 Sep Romania 10.5 OctRussia5.4 Romania4.4Croatia 7.6 Aug Finland 10.4 OctPoland5.3 Austria4.1Malta 5.9 Nov Slovenia 9.5 OctNorway5.3 Belgium3.7Germany 5.5 Nov Czech Rep. 8.9 SepIreland 5.1 Italy3.5Poland5.5 Jul Luxembourg 7.3 OctItaly4.5 Russia3.4Hungary 5.2 Nov Croatia6.4 AugFinland3.0 Denmark 3.4Austria 4.6 Nov Slovakia 6.3 SepGreece 3.0 United Kingdom3.3Italy 4.6 Sep Cyprus 5.7 OctPortugal 2.9 Greece2.9Bulgaria4.5 Nov Germany5.5 NovGermany2.9 Malta 2.8Spain 4.5 Nov Poland 5.1 JulDenmark2.0 Finland 2.7Belgium 3.9 Aug Malta4.7 NovUnited Kingdom 1.7 Norway2.1Netherlands 3.0 Dec Netherlands3.0 DecBelgium1.3 Germany 1.3UK3.0 Nov Norway 2.8 NovNetherlands1.2 Spain 1.0Montenegro -0.1 Nov Denmark2.7 NovFrance 0.9 Hungary 0.7Hungary2.3 NovAustria0.4 Switzerland 0.3Belgium1.7 AugSwitzerland-0.1 Czech Republic -0.7Austria1.4 NovTurkey -0.8 Slovakia -1.3Switzerland -3.3 NovSources: TourMIS, ETC, STR GlobalBased on data available through 16 January, 2012.Measures used for nights and arrivals vary by country Foreign Visits to Select DestinationsForeign Visitor Nights in Select Destinations 2011, year-to-date*, % change year ago 2011, year-to-date*, % change year ago 2525 2020 1515 10105500Switzerland Luxembourg Montenegro MontenegroRomania Slovakia Netherlands RomaniaEstonia NetherlandsLatviaDenmark AustriaSlovakiaMalta Estonia PortugalNorwayAustria LatviaFinlandCyprus Malta Hungary Cyprus BulgariaCroatiaHungaryBulgariaLithuaniaSpain CroatiaItaly SwedenSloveniaCzech Rep. Lithuania SpainSlovenia Czech Rep.Germany Germany SerbiaUKSerbia BelgiumBelgium-5 -5 Source : TourMIS, ETC, *date varies (Aug-Dec) by destination Source : TourMIS, ETC, *date varies (Aug-Dec) by destination European Travel Commission January 2012 7. 4European Tourism: Trends & Prospects (Q4/2011)Global Outlook: Will the Eurozone crisis sinkthe global economy?The financial crisis in the Eurozone has continued to worsen in recent months,despite a series of attempts by EU leaders to stem it. Problems in sovereigndebt markets have spread from Greece, Ireland and Portugal to Spain and Italy posing a much more severe threat of global financial contagion.Spain and Italys bond yields have risen sharply,to around 7% in the case of Italy a level whichEurozone: Maturing government debt billionis unsustainable in the medium-term despite90 Portugal Italysignificant bond purchases by the ECB. 80 Greece SpainMoreover, Italy and Spain need to refinance a 70very large volume of maturing government debt 60in the coming months and rolling this over will be 50very difficult unless market conditions improvesubstantially. Given the size of Italian and 40Spanish debt markets, the consequences of a30failure to rollover this debt would be dramatic 20in our view this rollover risk now poses the 10singl