The new policy sets out a range of objectives and aims to grow tourism over the next decade so that, by 2025, revenue from 10m overseas visits will increase to €5bn, enabling employment in the sector to rise to 250,000.
The tourism policy statement has three main targets to be achieved by 2025. They include revenue growth from €3.5bn to €5bn, employment to rise from 200,000 to 250,000 and overseas visits to grow from 7.6m annually to 10m.
Mr Donohoe declared these to be “ambitious targets for growth in overseas visits and associated revenue, and increased tourism employment”. But are they?
Not according to the Irish Tourist Industry Confederation which regards the targets to be far too modest and believes they should be revised upward, and for any new government to be more ambitious for an industry that actually employs 224,000 people throughout the country.
The ITIC is something of a broad church. As the umbrella group representing airlines, ferry companies, the hotels federation, tour operators, B&Bs, and visitor attractions, it operates at the coalface of the tourism industry, so its members know what they are talking about.
Recent CSO figures show that overseas earnings from tourism have risen already to €4.2bn per annum, a figure that makes something of a mockery of the “ambitious” target of €5bn by 2025.
Paul Gallagher, ITIC’s chairman, makes the point that this amounts to less than a 2% aggregate annual growth which is only about half of what they think is achievable.
As he puts it: “Imagine the food or pharmaceutical or IT industry accepting a 2% annual growth target? Why should we in tourism be any less ambitious? A figure of 4% annual growth should be eminently achievable for tourism — this would equate to €6.2bn annual expenditure by overseas visitors and crucially would create an additional 50,000 jobs.”
Instead of restricting targets the incoming Government should expand them and recognise that an already successful indigenous industry can make an even greater contribution to economic and employment growth.
In fact, the tourism industry is something of a victim of its own success and one of the issues facing it is managing growth. This is most apparent in Dublin which has seen a surge in visitor numbers while the supply of hotels has remained static.
The Government’s decision in 2011 to reduce the VAT rate from 13% to 9% has been the biggest engine of growth for tourism over the past five years, with surveys showing that it also helped create 33,000 jobs since then.
That enlightened approach to a vital part of our economy should now be replicated with a more ambitious policy.