|June 24, 2008
- Three Dominicans on regional tourism board
- Tourism upward trend is irreversible
- Rule of law essential for investment
- US traveler has changed
|Three Dominicans on regional tourism board
The Annual Caribbean Tourism Summit opened this Sunday, 22 June in Washington, D.C. bringing Caribbean ministers of tourism and key hotel sector executives to the forefront of the attractive Washington, D.C. travel market and policy makers. The DR was represented at the event by its private sector, with three Dominicans on the board of the Caribbean Tourism Development Company (Caribbean Hotel Association private sector side) for the first time. Former president of the National Hotel & Restaurant Association (Asonahores), Enrique de Marchena is the newly appointed co-chairman of the CTDC, Haydee Rainieri of the Puntacana Group is the fourth vice president, and Reyson Pimentel of BlueBay hotels is the regional vice president for the Central Caribbean.
In his opening remarks, De Marchena highlighted the marked desirability of the region for international investors, pointing to continued investment by leading travel companies such as Raffles, Rock Resorts, Four Seasons and Ritz Carlton and Westin.
Allen Chastanet, co-chairman of the government sector in the CDTC stressed the need for governments to fully take on tourism as the region's most important industry and to come up with more financial support for CDTC activities. CDTC has been pushing the Caribbean branding.
The meeting of Caribbean Hotel Association and Caribbean Tourism Organization under the umbrella of Caribbean Development Tourism Company was moved to Washington, D.C. after President Fernandez met with Allan Chastanet at a New York Counterpart-CMEX press educational meeting. Nevertheless, no one from the Dominican Ministry of Tourism attended the event.
|Tourism upward trend is irreversible
The former Chairman of the US Federal Reserve, Alan Greenspan told the audience at the Annual Caribbean Tourism Summit gathered in Washington D.C. that despite the problems, tourism by its nature is on a long-term upward trend. He assured delegates from 33 Caribbean nations that Americans would continue to travel to the Caribbean in increasing numbers.
Greenspan forecast that "what we are seeing with respect to globalization is an ever- increasing breaking down of barriers. There is an inevitable trend towards the sovereign barriers coming down and people moving", he said. Even with the rise in the price of jet fuel, remarked Greenspan, the real cost of transportation has been going down. He forecast that technology and advances would keep recreational tourism going. "When you are dealing with an industry with momentum in an upper direction, you can absorb shocks and come back," he said. But he made the point that travel for the first quarter of 2008 is at levels similar to 2006, despite all the problems.
Greenspan attributed the spiking price of oil to speculation. He said that prices initially rose when analysts foresaw that the actual investment in drilling and infrastructure to ensure the required levels of crude supply remained flat, and thus the reserve buffer was being eaten into, which moved prices up. "We have had a very dramatic rise in demand to hold inventories, but the supply of inventories is growing very gradually, and therefore prices have taken off," he said. This spurred the investment community to get involved and hold inventories for three to six years into the future.
He said that speculation was good, because it contracted consumption for the first time. He explained it removes the peak of what the price of oil otherwise would have been.
Another advantage is that by getting prices to move off faster, we are getting a contraction of consumption for the first time, and the ultimate price at which oil would have risen if there had not been the contraction.
"If you took speculation out, prices would rise slower but when you ran into real serious problem when the buffer would go to zero, they would zoom up," he said.
He forecast, "We are going to see ever-increasing aviation fuel prices, ever more efficient jet engineers, and seeing as there is a substantial demand for exotic metals in jets and engines that save fuel, eventually we will get the per mile cost down."
|Rule of law essential for investment
Alan Greenspan, former chairman of the US Federal Reserve, told the Caribbean government and business representatives gathered for the Annual Caribbean Tourism Summit in Washington, D.C. that the rule of law is the most important element in attracting investors to the region.
"When I look beyond a three, four or five-year period for forecasting purposes, I found that the most useful way of determining who is going to prosper, is not looking at demographics, potential trends in investment and productivity, but asking where the rule of law is most stable. What history tells us is that time and time again, capital moves to those areas that are safe. This means where you can get your money out quickly," he said.
Greenspan highlighted the fact that areas where there are strong property rights attract capital. "You need to assure investors that property rights will be respected. You need to communicate to investors that they will get back the capital they have invested in facilities, and will get a reasonably good return."
Greenspan said that education is "secondary." Rule of the law is the historically most important factor for attracting investment, he said.
He suggested that the Caribbean should avoid skipping the normal stages of development, and accelerate them instead. He said that the Caribbean has the extraordinary advantage of being near a large population to the north that considers them valuable. "The true potential of the Caribbean has not yet been tapped," he said.
|US traveler has changed
Prospects for US travel are changing, says Ron Erdmann, deputy director for travel at the US Department of Commerce. He warned the Caribbean about a dramatic shift in the characteristics of travelers from 2006 to 2007. He urged markets to take heed because travelers will go to destinations that offer what they want.
He said that recent research had found that the Internet continues to dominate as the No. 1 source of information, with 45% of travelers referring to the Internet to decide where to go for vacation. This compares to 25% who relied on travel agents, 27% who relied on airlines, and 15% who relied on friends and relatives.
He explained that tourists are planning their trips far in advance and not waiting for the last minute to make a decision. Their research shows that average planning time has increased to 93 days.
Furthermore, he said that there is a marked decline in the number of tourists who are traveling on packages - going from 29% in 2006 to 16% in 2007. On the other hand, there is a heavy market of repeat travelers who are taking multiple trips during the year to leisure destinations. He said that 57% of travelers are on leisure trips, 29% are visiting friends and relatives, and 10% are on business trips. The average trip for the American traveler is nine nights, which is up from eight days.
Another major change he urged the Caribbean marketers and policy makers to keep in mind is that the taxi has become the dominant way for travelers to get around within the islands, followed by rental car. More tourists are booking taxis instead of tour excursions to see the islands at their leisure. This makes it necessary for educational programs to be in place and good road signage to be available.
The study showed that there has been an increase in interest in visiting small towns and touring the countryside, and a decline in dining, shopping, watersports, sunbathing and casino gaming.