Overseas visitor revenue falls 12% below target

REVENUE from overseas visitors to Ireland has fallen almost 12% behind targets for tourism, according to a report.

A mid-term review of the Government’s tourism policy has highlighted how spending by foreign tourists struggled to keep pace with official projections for 2006, even before the recent global economic downturn.

The report by the Tourism Strategy Implementation Group also warns there is uncertainty about the growth prospects of key overseas markets over the coming years, particularly Britain and the US.

The group’s findings show revenue from foreign tourists to the republic in 2006 was more than €400 million behind projections, with spending reaching only €3.38 billion in real terms instead of the target of €3.85bn.

Total overseas revenue grew at a slower rate than projected, with the exception of mainland Europe.

The average revenue generated by visitors from the US and Canada has fallen by 20% since 2002, largely due to the fall in the exchange rate, high domestic inflation and shorter average stays.

However, revenue from Irish people holidaying within the republic was almost 20% ahead of target at €775m in 2006.

The number of tourists from Britain has also lagged behind official targets by over 6%, although visitor numbers from other key markets such as continental Europe and the US remain ahead of target.

The report claims the original targets contained in the policy document, New Horizons for Irish Tourism: an Agenda for Action 2003-2012, will be difficult to achieve due to the current international economic climate and the recent Irish slowdown.

It notes Ireland is facing increased competition as Central Bank figures show competitiveness fell by almost 25% between 1999 and 2008 due to rising costs and exchange rate factors.

It claims greater productivity with a focus on “value for money” will be key to future success.

On a more positive note, inflation in the hotel and restaurant sector has lagged behind overall inflation levels in the past year. But concern was also expressed that tourism workers may not have the depth of local knowledge and communication skills that enhances the experience of visitors, as official figures show 30% of all hotel and restaurant staff are foreign nationals.

Tourism Minister Martin Cullen welcomed the report and announced the creation of a high-level group to further review the Government’s tourism policy, chaired by former C&C boss, Maurice Pratt.