World Travel Market 2017: The Long Shadow Of Brexit & Catalonia:

DSC_0293Have you decided yet where you will be going on holiday in 2018? If you have already chosen Italy, then you are among the 60% of UK residents for whom that country will be the preferred destination next year – ahead of the USA (54%), Greece (48%) and Cuba (24%). These statistics were published in the World Travel Market (WTM) 2017 Industry Report to coincide with the opening of WTM at London’s Excel Centre (6th – 8th November), which was attended by around 51,500 senior travel industry professionals, as well as government ministers and the international media.

DSC_0295Several Italian cities – Rome, Milan, Venice & Florence – feature in Euromonitor International’s top 100 Global Rankings 2017 and the country’s “strong tourism performance” is mainly thanks to its wide range of attractions and the fact that it is perceived as being relatively stable compared to many of the other options available elsewhere in the world. For the same reasons, according to the WTM Report, this has been a “bumper year” for Greece and the prospects for 2018 are even better.

DSC_0296Although Spain remains a popular vacation venue, in the opinion of Olivier Jager, Chief Executive Officer of the travel industry analysts ForwardKeys, it could be adversely affected by the current turmoil in Catalonia. The Travel Daily News International correspondent, Tatiana Rokou, on 31st October quoted Jager as emphasizing that “domestic political unrest almost always deters visitors and that is what we are seeing now – a 22% collapse in international flight bookings for Catalonia”. Because many visitors arriving there then proceed to visit and explore other parts of Spain, any further decline “will be of great concern as travel and tourism represents such a large proportion of the Spanish economy, over 14% of GDP”.

DSC_0299During WTM, the staff at the Catalan stand, which was positioned on the corner of the extensive Spanish pavilion, put on a brave face and did their best to conduct “business as usual”, handing out colourful maps of the region and leaflets promising “a top notch programme of activities in Barcelona as part of the Year of Cultural Tourism 2018”. However, their chief tourism official, Patrick Torrent, acknowledged in an interview with Associated Press at WTM that (as depicted by Travel Industry Today) “ the freedom fight come with a price” and that the region will probably see a 10%-12% fall in tourist numbers during the 4th quarter of 2017, a level of decline equating to around 450 million euros, with the large bulk of the fall related to a drop-off in business travel to events such as conventions”.

 

IMG_1551As both The Daily Telegraph and Bloomberg Politics have pointed out, Catalonia – along with the Madrid region, Valencia and the Balearic Islands – is a net contributor to Spain’s tax and spending accounts: “It pays about 8.8 billion euros more than it receives, a longstanding complaint of the separatists”. The Economist magazine noted in its November 4th edition that “more than 1,800 companies, among them CaixaBank, Banco Sabadell and Freixenet, have been prompted to move their legal domicile out of Catalonia since 1st October”– a trend, the deposed Catalan President Carles Puigdemont told Sky News from Brussels on 11th November, that has been encouraged by Spanish Prime Minister Mariano Rajoy, who is fiercely opposed to the region’s push for independence.

DSC_0304There are, so the Global Risks Insights journalist, Niall Walsh, contended on October 10th, “some striking parallels between the proposal for Catalan independence and the Brexit vote in 2016: An increase in business risk generated by a climate of uncertainty, rising political and social instability and a fresh challenge to the effectiveness of the European Union”. The WTM Industry Report 2017 has concluded that Brexit threatens to undermine London’s dominant position as a place to do business and that “competing cities that have emerged in an attempt to steal it’s crown include Paris, Frankfurt, Stockholm, Dublin and Amsterdam”.

More than half (53%) of all travel trade respondents – states the Report – believe Brexit will have a negative impact on their companies and that it has already damaged the UK’s reputation as a holiday destination. Over 20% of European Union citizens working for British tour operators have apparently already left the UK “because of the long-term uncertainty over their status” and 50% of these organizations are having difficulties recruiting new EU employees. The British Hospitality Association has highlighted “how crucial EU workers are to UK firms, especially because of their language and service skills – and warned that there are not enough British people with the right expertise to replace them”.

DSC_0305An equally gloomy assessment was issued on 6th November by the Chartered Institute of Procurement & Supply (CIPS). Under the headline “EU businesses say goodbye to UK suppliers as Brexit bites into key relationships”, it asserted that the uncertainty has meant that 20% of UK companies with EU suppliers have found it difficult to secure contracts that run after March 2019 , 8% say they have already lost contracts as a result of Brexit and 35% feel unable to prepare due to the lack of progress on a future trade agreement between the UK and the EU.

The CIPS Chief Executive, Gerry Walsh, considers that “it is already too late for scores of UK businesses who look like they will be deserted by their European partners.” They simply can’t keep their suppliers and customers waiting , he declares, while the negotiators get their act together: “The lack of clarity coming from both sides is already shaping the British economy of the future – and it does not fill businesses with confidence. The clock is ticking”. Yet despite all this apparent despondency, 31% of those questioned by WTM predicted that Brexit will have no prejudicial consequences at all and 16% that, on the contrary, it could prove to be extremely positive.

IMG_1545

DSC_0285

DSC_0307IMG_1548

 

 

Filed under: Travel | Posted on November 14th, 2017 by Colin D Gordon

Comments are closed.

Categories

Recent Posts

Archives

Copyright © 2017 Colin D Gordon. All rights reserved.