Year to forget for tourism as visitors fall by 15%

IRISH tourism experienced an “annus horribilis” in 2010, with a 15% fall in visitors — the poorest performing tourist season in over a decade.

The combined effect of the contraction of the overseas and domestic markets meant overall revenue declined by 13% to €4.6 billion.

Fáilte Ireland said the downturn in overseas visitor numbers to 5.6 million had led to a 14% decline in revenue to €3.3 billion, which meant Irish tourism had fallen back to levels last experienced in 1998.

Announcing the results of its annual review in Dublin yesterday, the chairman of the national tourism development authority, Redmond O’Donoghue, said it had been an “extraordinary, difficult year” which had been book-ended by extended periods of extreme weather coupled with the impact of volcanic ash from Iceland last spring on the aviation industry.

In addition to the sharp fall-off in foreign tourists, the domestic market also suffered, with the number of trips taken at home by Irish holiday-makers down by 4% to 8m, while revenue fell by 10% to €1.3bn.

The majority of hotels and guesthouses reported falling profits during 2010 as two-thirds of accommodation providers claimed they had lowered their prices last year.

The owners of guesthouses, B&Bs, hostels and self-catering accommodation were the worse affected, although hotels reported a 2% increase in occupancy levels.

However, the average room rate for urban-based hotels fell by 6% last year.

On a regional basis, Dublin suffered the biggest reduction in 2010, with overseas visitor numbers down by 17% — largely due to the sharp decline in tourists from Britain.

Looking ahead, Mr O’Donoghue said the 2011 tourist season was highly dependent on the performance of the British market which accounts for 45% of all overseas visitors to the Republic.

However, he welcomed the fact that Irish holidays now represented good value for money and recent international reports which rated Ireland as a top tourist destination for the coming year.

Mr O’Donoghue also praised tourism providers for showing great resilience as they endured falling revenues and profitability.

Fáilte Ireland chief executive, Shaun Quinn said it was difficult to predict tourism numbers and revenue for the year ahead.

However, Mr Quinn admitted that the season would rely on the overseas market for growth as the number of Irish people taking holidays at home had effectively peaked and revenue from this source was likely to fall further in 2011.

Mr Quinn said falling prices, the recent cut in air travel tax combined with a rise in British VAT rates and the growing strength of sterling against the euro make Ireland a more attractive option for British tourists.

However Mr Quinn expressed concern that 20% of tourism providers said they had no access to working capital, while a further 60% said they only had limited access to loans from banks. He also warned that local authority charges as well as energy costs remained a concern for the industry.

Mr Quinn said a third of tourism providers had reported a reduction in staffing levels last year with 20% expecting further decreases in 2011.

Fáilte Ireland is to increase its budget for business supports services by 50% with a renewed focus on mentoring, web design, skills development and overseas sales.