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 Travel & Outdoors | July 2006 
Central American Tourism Boom
 LatinBusinessChronicle.com
| | Attractions like the Tazumall ruin in Chalchuapa are boosting tourism arrivals in El Salvador. |
Thanks to an ambitious plan aimed at boosting El Salvador as a destination for business and pleasure, the Central American country is now one of the fastest growing tourism markets in Latin America.
"El Salvador is the big success story, achieving a growth of nearly 23 percent in arrivals from January through April, attributed to the enthusiastic support of all stake-holders in the destination's tourism, including the country's President," the Geneva-based World Tourism Organisation said in its latest World Tourism Barometer, released last week.
The WTO credits El Salvador's National Plan for Tourism Development to 2014 for the impressive numbers last year and so far this year. During all of 2005, El Salvador registered 1.1 million visitors, an increase of 19.5 percent from 2004. That was the second-highest growth rate in percentage terms in Latin America last year (behind Venezuela). In the first quarter this year, arrivals were up by 20.0 percent. That was again the second-best performance (behind Paraguay).
The increase has had a clear impact on the economy. Last year, El Salvador received $543 million in tourism revenue. That was a 61.0 percent increase in local currency terms.
However, El Salvador wasn't the only Central American destination seeing strong tourism growth. Big winners last year also included Nicaragua, Costa Rica, Panama, Guatemala and Honduras. In fact, Central America posted the highest growth rate worldwide last year: 14.1 percent. By comparison, Asia-Pacific grew by 7.8 percent, Europe by 4.0 percent and the US by 7.2 percent.
All in all, Latin America received 65.4 million international visitors last year. That was an increase of 7.9 percent from 2004 and better than the world average of 5.6 percent. In addition to the strong growth in Central America, the increase was boosted by South America's growth of 11.6 percent.
"The stronger US economy, greater consumer awareness of the region's tourism attractions and, most importantly, improved airlift, are cited as the main reasons for the good growth overall," the WTO says. "In addition, more aggressive marketing and promotion in key and emerging source markets, with an increased emphasis on cooperative efforts with the private sector, have also seen good returns on investment. "
15.4 million Americans traveled to Latin America by air last year, according to Office of Travel and Tourism Industries at the US department of Commerce. Mexico was the top destination, accounting for 5.6 million visitors.
Latin America represented the best growth market for the Air Transport Association of America (ATA). RPM (Revenue Passenger Mile) to and from Latin America grew by 5.7 percent last year, which was higher than the growth registered in to/from Europe (2.6 percent) and to/from Asia (3.9 percent). Measured by RPK (Revenue Passenger Kilometre), Latin America had the second-highest growth worldwide (after the Middle East).
MEXICO
Mexico is the main driver behind Latin American tourism, accounting for a third of all arrivals in the region. Mexico last year received 21.9 million tourists. While it boosted arrivals by 6.3 percent last year, that represented the highest real increase: 1.3 million more visitors. Mexico is also a leading destination worldwide. Last year, it ranked seventh, ahead of such destinations as Germany and Austria. Top Mexican attractions include Cancun, Acapulco, Puerto Vallarta and (for business travel) Mexico City.
But this year, Mexico posted a decline of 4.0 percent in the first quarter. The country is still recovering from the damage brought by Hurricane Wilma, which hit the Yucatan Peninsula last October, the WTO points out. "However, there are encouraging signs in Mexico as April was the first month to show positive growth in terms of international arrivals since November 2005," the WTO says.
Some 20,000 rooms in Cancun were operational by the end of April. By comparison 27,000 were operational prior to October 2005. "Hotels are currently running at around 80 percent occupancy - up from an average of 72 percent in 2005 - which is a remarkable achievement given the hurricane season's impact," the WTO says.
BRAZIL AND ARGENTINA
Brazil, Latin America's second-largest tourism market, registered 5.3 million international arrivals last year, an increase of 11.8 percent from 2004. The WTO does not have any first quarter arrival figures for Brazil, but data on tourism receipts show continued healthy growth of 20.5 percent measured in local currency terms. That compares with growth of 14.7 percent in the first quarter last year.
All in all, Brazil registered tourism receipts of $3.9 billion last year, the second-highest figure in Latin America after Mexico. Top attractions include Rio de Janeiro, Bahia and (for business travel) Sao Paulo.
Argentina, Latin America's third-largest tourism market, registered 3.9 million international arrivals last year, an increase of 12.7 percent from 2004. During the first quarter this year, arrivals grew by 11.9 percent. The increase last year led Argentina to replace the Dominican Republic as the region's third tourism market. But even more impressive, Argentina substantially boosted its earnings from tourism last year - by 30.1 percent in local currency terms. Total receipts were $3.3 billion, the fourth-highest figures in Latin America. Top attractions include Buenos Aires, Patagonia and the Iguazu Falls.
DOMINICAN REPUBLIC
The Dominican Republic, Latin America's fourth-largest tourism market in visitors and third by receipts, registered 3.7 million international arrivals last year. That was an increase of 7.0 percent from 2004. During the first quarter this year, arrivals grew by 7.6 percent. Although it lost its previous third ranking in arrivals to Argentina last year, it kept its third place in receipts. Last year, the Dominican Republic received tourism revenue of $3.5 billion, an increase of 11.5 percent. Only Brazil and Mexico had higher revenues. Top attractions include Casa de Campo, Punta Cana and Juan Dolio.
In addition to continued strong demand from traditional markets, the Dominican Republic is seeing increased arrivals from new markets such as Russia, the Ukraine, Poland and Bulgaria, the WTO says. It also says new destinations within the Dominican Republic will help boost tourism this year.
Nearby, Cuba also boosted arrivals. The Caribbean country, Latin America's fifth-largest tourism market, registered 2.2 million tourists last year, an increase of 12.1 percent from 2004. However, during the first quarter arrivals were up by a mere 2.5 percent, according to the WTO. Unlike the other Caribbean and Latin American nations, Cuba receives few American tourists due to the US embargo against the island. Top attractions include Havana and Varadero.
CENTRAL AMERICA
While El Salvador has seen the strongest growth in Central America, Costa Rica remains the top tourism destination in the region. Last year, the country received 1.7 million visitors, an increase of 15.6 percent from 2004. Tourism receipts last year grew by 14.2 percent to $1.5 billion, by far the highest revenues of any Central American tourism market.
The WTO has no first quarter data on Costa Rica, but reports that anecdotal evidence shows a disappointing performance. However, its prospects are good. "Costa Rica is one of the fashionable destinations in the region for increasingly environment-friendly Europeans," the WTO says. Top attractions include Monteverde, the Chirripo National Park and San Jose.
Guatemala, the second-most popular destination in Central America, registered a total of 1.3 million visitors last year, an increase of 11.4 percent. During the first quarter, arrivals grew by another 12.2 percent. Receipts, meanwhile, grew by 12.8 percent last year to $869 million and were up by 21.0 percent in the first quarter this year. Top attractions include the the Tikal ruins and Antigua.
Honduras remained the third-most popular destination in Central America. Last year it received 749,000 tourists, an increase of 11.4 percent from 2004.
Nicaragua has also seen strong growth and managed to pass Panama in terms of arrivals. Last year, Nicaragua received 712,000 international tourist arrivals, up 15.9 percent from 2004. Top attractions include the Granada, Montelimar and Corn Islands.
Panama received 702,000 tourists, an increase of 13.0 percent. Top attractions include the Panama Canal, Boca Grande and the Contadora and San Blas islands.
However, Nicaragua and Panama may again change places this year. During the first quarter this year, arrivals declined by 1.0 percent in Nicaragua, while they grew by 16.3 percent in Panama. The decline in Nicaragua is largely due to a new visa fee charged on visitors from neighboring Costa Rica, the WTO says.
PERU AND COLOMBIA
Peru received a total of 1.5 million tourists last year, an increase of 16.4 percent from 2004 and the fourth-highest growth rate in Latin America last year. During the first quarter, visitors were up by 15.5 percent, the third-highest growth rate in the region. Tourism revenues reached $1.2 billion last year, an increase of 15.0 percent. In the first quarter they grew by another 14.3 percent. Top attractions include the Machu Picchu ruins, Cuzco and the Nazca lines.
Colombia grew even more than Peru last year, by 18.0 percent, to 933,000 arrivals. In the first quarter it grew by another 12.1 percent. That follows strong growth in 2004. The increase is due to the improved security, combined with more marketing, the WTO says. Last year, Colombia received tourism revenue of $1.2 billion, an increase of 15.1 percent. Top attractions include Cartagena and the San Andres and Providence island group.
The other Andean nations have shown mixed results. Venezuela posted Latin America's highest percentage growth in arrivals last year: 24.3 percent. However, this year tourism has been affected by infrastructure problems. "Venezuela's tourism ...continues to be affected by the collapse of a viaduct on the highway between Caracas and the airport," the WTO says. "The journey takes four hours and weekend travel to the interior is suspended."
But the WTO praises efforts by the Venezuelan authorities to enhance and diversify the country's tourism product.
Ecuador, home to the famous Galapagos Islands, boosted tourists last year by 5.1 percent to 861,000. However, during the first quarter this year, it saw a 8 percent decline. Tourism receipts grew by 5.1 percent last year to $486 million, but declined in the last three quarters of the year. "Sustained development in Ecuador's tourism has been somewhat comprised by the social, political and economic situation in the country," the WTO says.
Ecuadorian president Lucio Gutierrez was ousted in April 2005 by congress and replaced with Alfredo Palacios, who has been plagued by frequent cabinet changes.
OUTLOOK
Latin America is expected to see continued healthy growth in the short term as well. Like the rest of the world, the region faces challenges like rising oil prices and the threat of the avian flu. But more efficient airlines and success in isolating the avian flu could keep both those challenges from negatively affecting tourism travel to Latin America.
"Central and South America are bullish about prospects from Europe, especially given the strong euro," the WTO says. |
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