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Travel and tourism

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Tourism is big business in Canada. In 2007 it accounted for $70.6 billion of spending in current dollars, a growth of 4% over the previous year, with most of that money coming from Canadians. Our spending on domestic travel in 2007 grew 7% from 2006, and accounted for 77% of the money spent in the sector.

But Canadians do not just like to travel within Canada; we enjoy visiting the United States, and in record numbers we also travel overseas. Indeed, for Canadian travellers, 2007 was record-breaking in a number of ways: it was the first time Canadians took more than 25 million overnight trips abroad, and our spending on those trips was the highest ever at $22.5 billion.

At the same time, Canada is an attractive destination for travellers from abroad, drawing more than 30 million visitors in 2007. That was three million fewer than in 2006 as our appeal to our major market, the United States, continued to decline. A strong Canadian dollar, border security, higher gasoline prices and a weakening U.S. economy were all part of the travel story.

Travel close to home increasing

When it comes to domestic travel, Canadians do most of their travelling within their home provinces. In 2006, 9 out of 10 domestic excursions were in-province: that was 188.9 million in-province visits and trips, compared with just 19.6 million between provinces. The majority of these, 119.2 million trips, were same-day visits. The remaining 87.2 million trips were for an average of three nights away from home, for a total of 265 million nights away. Slightly more than one-third of those nights were spent in commercial accommodation.

Whether visiting within their own province or in another, Canadians have two main reasons for their in-Canada travel: of the 206.4 million total domestic excursions in 2006, 182.6 million (88%) were either for pleasure or to visit friends and relatives.

Canadians enjoying higher loonie south of the border

Outside our own country, our number one destination is the United States. In 2007, Canadians made 42.6 million excursions there. More than half of that was same-day travel—24 2 million car visits, 3% more than in 2006.

But it was overnight travel that really heated up in 2007, rising 11% and, at 17.8 million trips, the highest level since 1992. In 2007, as the value of the Canadian loonie rose steadily against the American greenback—its value exceeded that of the U.S. dollar in September 2007 for the first time in 30 years—Canadians’ spending in the United States rose to $11.5 billion, up 13% from 2006.

Given its proximity to our most populous provinces—Ontario and Quebec—perhaps it is not surprising that New YorkState is Canadians’ favourite overnight destination. In 2007, Canadians made three million overnight visits to the EmpireState, 14% more than in 2006, and we spent $919 million, 20% more.

Given its winter appeal, Florida is Canadians’ second most popular state to visit. Florida is also where we spend the most money. Canadians took 2.5 million overnight visits there in 2007 and spent $2.8 billion, an increase of 18% over 2006.

In percentage terms, though, it was North Dakota that received the largest gains in Canadian visitors and Canadian spending in 2007: a 26% increase in overnight visits and a 51% increase in expenditures during these visits. Most of that money was spent after the Canadian dollar achieved and exceeded parity with the U.S. dollar.

Canadians travelling more overseas

Canadians are also travelling more overseas, with a record high 7.4 million overnight trips in 2007. This was an increase of 10% over 2006 and the fifth consecutive annual rise. In 2007, travel increased to every overseas region except South America and Oceania.

Among the regions of the world, Europe attracted Canadians the most, drawing 4.2 million overnight visits in 2007, followed by the Caribbean, with more than 1.8 million overnight visits. But on an individual country basis, Mexico predominated for a second year in a row. Canadians’ made more than one million visits to Mexico in 2007, up 21% from 2006. Canadians next favourite overseas destinations, in descending order, were the United Kingdom, France, Cuba and the Dominican Republic.

Growing numbers of overseas visitors

Just as we are travelling overseas more, growing numbers of overseas visitors are journeying to Canada. Travel from overseas nations to Canada rose for the fourth consecutive year in 2007, up 3% to 4.4 million overnight trips.

With 891,000 overnight trips, visitors from the United Kingdom remained Canada’s most important overseas tourism market. The number of travellers from the United Kingdom rose 6% over 2006. Even more came from Australia: their 208,000 overnight trips in 2007 represented a 17% increase over the previous year. Overseas tourists contributed a total of $6.0 billion to Canada’s economy in 2007, up 4% from 2006.

This increase in overseas travellers did not come close to compensating for the decline in U.S. visitors. Every year since 1999 has seen their numbers decline—down to 25.7 million in 2007. Americans’ same-day car trips here dropped to 11.2 million in 2007, down 19% from 2006, while their overnight travel fell 4% to 13.4 million trips, the lowest level in a decade. The impact of these declines on spending was marked: Americans spent $7.8 billion in Canada in 2007, down 5% from 2006 and the lowest level since 1997.

A record international travel deficit

The decline in numbers of foreign visitors to Canada, plus Canadians’ increasing travel outside the country, added up to a record high international travel deficit. In 2007, the travel deficit (the difference between spending by Canadians abroad and spending by foreigners in Canada) hit $10.0 billion. While Canadians spent $26.9 billion outside the country, 15% more than in 2006, foreign spending in Canada edged up just 0.1% to $16.6 billion.

The previous record high deficit of $6.8 billion was posted in 2006. In 2002, the deficit was $1.7 billion.

The effect of the decline in American visitors and their spending is more telling: Canada’s travel deficit with the United States climbed to $7.0 billion in 2007, $2.7 billion higher than in 2006. That broke the previous high from 1991 by almost $1.0 billion.