Analysis

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Overview of trends 2009

The economic crisis and the threat of H1N1 pummel worldwide international tourism

According to the United Nations World Tourism Organization (UNWTO), in 2009 international tourist arrivals continued on the downward trend that prevailed in the second half of 2008. It wasn't until the fourth quarter of 2009 that arrivals picked up and began to show increases from the previous year. These increases were not enough to offset the losses sustained in the earlier quarters.

Two major events are considered to have attributed to the decrease in international tourist arrivals. The UNWTO reported that the global economic recession and the threat of an influenza pandemic (H1N1) contributed to the losses realised in the first three quarters of 2009.

According to the UNWTO, international tourist arrivals dropped 4.2% in 2009 to 880.0 million. Decreases were observed in all regions of the world with the exception of Africa with 3.1% growth. This is a worldwide decline of 39.0 million arrivals from 2008.

Inbound tourism has become one of the major trade categories, and in 2009 the tourism sector accounted for about 30.0% of all service exports worldwide, and 6.0% of overall exports of goods and services.

The 2009 international tourism receipts dropped 5.7% to US$852.0 billion, representing the first year of decline since 2003. During that year, unrest in the Middle East and a SARS (Severe Acute Respiratory Syndrome) outbreak were blamed for the reduction of international tourism receipts.

The UNWTO has suggested that since international tourism receipts and international tourist arrivals follow a similar trend, the slowdown in receipts is likely due to the low numbers of arrivals and not due to a reduction of expenditures.

On a regional level, in the first three quarters of 2009 all regions experienced contracting international tourist arrivals. The hardest hit has been Europe, the largest market, which suffered a reduction in international tourist arrivals of 5.7%. This brings the number of visitors down by 27.5 million from 2008 results to 459.7 million. After losing 7.0% of their international tourist arrivals in the first half of 2009, Asia and the Pacific rebounded recording an overall loss of 1.6% from the previous year's totals.

Regions are ranked using two major indicators, international tourist arrivals and receipts. The top three destinations for both arrivals and receipts were France, Spain and the United States. Although France ranked third in terms of receipts, generating US$49.4 billion, it was the number one tourism destination in terms of arrivals, hosting 74.2 million tourists in 2009. In contrast, Spain ranked third in terms of arrivals with 52.2 million visitors yet held second position in terms of receipts with US$53.2 billion. The United States ranked first in terms of receipts with US$93.9 billion, but was in third position in terms of international tourist arrivals with 54.9 million tourists in 2009.

Canada's position in this global arena has remained steady for the past few years. In terms of arrivals Canada ranked 14^th and for international tourism receipts Canada ranked 15^th. In 2009, Canadian expenditures in foreign countries were US$24.2 billion, down US$3.0 billion from 2008. Despite the curb in expenditures, Canada was still ranked eighth in international tourism expenditures in 2009.

Overnight travel from the United States to Canada hits 24-year low

United States residents made about 11.7 million overnight trips to Canada in 2009, down 6.7% from 2008 and the lowest level since 1985. This was the fifth consecutive annual decrease in overnight travel by United States residents and the sixth in seven years. The downswing began in 2003, during the height of the Severe Acute Respiratory Syndrome (SARS) crisis.

June 2009 saw the implementation of the final piece of the Western Hemisphere Travel Initiative (WHTI). The WHTI was legislation passed by the U.S. Government requiring a passport by all individuals, including U.S. citizens, to enter the United States at all border crossings. Previously, a passport had not been required by American or Canadian citizens entering the United States by car.

Overnight travel by residents of overseas countries declines

Overnight travel by residents of overseas countries other than the United States decreased for the first time in six years in 2009. Travellers from overseas countries made about 3.9 million overnight trips to Canada, down 12.8% from the previous year. This was the lowest level since 2004.

The first three years of the decade (2000-2003) had seen a decline of 25.6% of overnight trips from overseas countries. These years were notable for the events of September 11, 2001 and the SARS crisis in 2003.

Canadians continue to travel abroad

Canadian residents took 26.2 million overnight trips abroad in 2009, a decrease of 3.1% from the record high set in 2008. This was the first time in six years that overnight travel outside the country decreased. Despite the decrease, 2009 was still the second highest year on record.

Overnight travel to the United States decreased 5.0% from 2008. Canadian residents took 18.0 million overnight trips to the U.S., the fourth highest year on record.

Travel to overseas countries reached a high of 8.2 million overnight trips, up 1.3% from 2008. Travel to non-U.S. destinations has steadily shown an upward trend, falling only six times since record keeping started in 1972. The last decline was in 2002 (-3.1%) and since then, overnight travel overseas has increased 75.8%.

Same-day car travel from the United States hits bottom

United States residents made 7.8 million same-day car trips to Canada in 2009, down 13.9% from 2008 and the lowest number since record keeping started in 1972. Back then, Americans made 21.0 million same-day car trips to Canada.

Same-day car travel by U.S. residents has fallen every year since peaking at 27.3 million in 1999, with six of the last seven years experiencing double-digit declines.

A combination of factors may have contributed to this latest downswing in same-day car travel from the United States, including the after effects of the financial crisis of the fall of 2008 and the resultant economic difficulties experienced in the United States. The implementation of passport requirements by the U.S. Government at all border crossings also likely contributed to fewer trips.

Same-day car travel to the United States down

Canadians made 20.9 million same-day car trips to the United States in 2009, a 13.3% decrease from the previous year and the lowest figure since 2002.

The majority of the decrease was in the first three-quarters of the year, most likely the after-effects of the economic downturn from the previous year.

United States market

Overnight business-related travel dropped sharply as U.S. residents took 1.7 million trips, down 11.5% from 2008. United States residents made 6.3 million overnight trips to Canada for pleasure purposes in 2009, 8.7% fewer than in 2008. Overnight trips to visit friends and relatives however, increased 2.0% from 2008.

Pleasure travel includes holidays and vacations, visiting a second home, cottage or condo and attending events and attractions. Business travel includes attending meetings, conventions, conferences, trade shows and seminars, and participating in other work-related matters.

Car travel represented 60.4% of overnight trips from the United States, while overnight travel by plane represented 28.1%. Both declined compared to 2008.

The 6.7% drop in overnight travel from south of the border resulted in a decline in spending by United States residents. Americans spent $6.1 billion in Canada, down 7.5% from 2008. U.S. residents stayed 47.4 million nights in Canada, an average of 4.1 nights per overnight trip, unchanged from the previous year. Average spending per night remained stable at $129.

Overnight travel from top states down

Overnight travel from 14 of the top 15 states of origin, including the top five, declined in 2009. The state of New York, the largest source of American tourists travelling to Canada, saw a 5.6% drop in overnight trips, to 1.7 million. Among the top 15 states of origin, Michigan recorded the biggest drop in overnight travel to Canada (-11.7%) while Texas posted the only increase (+0.6%).

Ontario the most popular destination for overnight travel by U.S. residents

Of the 11.7 million overnight trips from the United States to Canada in 2009, about 5.8 million included an overnight visit to Ontario. British Columbia was the second most visited province, with 2.9 million overnight visits. Most provinces saw declines in overnight visits from the United States.

Overseas market

Residents of overseas countries made 3.9 million overnight trips to the country in 2009. This was a decline of 12.8% from the previous year.

2009 remained a challenging year for many countries, as their economies attempted to rebound from the financial difficulties that started in the fall of 2008.

Residents of overseas countries spent $5.4 billion on overnight trips to Canada, 13.9% less than the previous year. They stayed 67.5 million nights in Canada, or 17.2 nights per overnight trip. Overall, residents of overseas countries spent $80 per night on overnight trips to Canada.

Over half of all tourists from overseas countries come from Europe

Europeans made 2.1 million overnight trips to Canada in 2009, a 10.4% decrease from 2008. Over half of all tourists from overseas countries came from Europe.

Every region posted a decrease in the number of visitors to Canada.

United Kingdom largest overseas market by far

The United Kingdom remained Canada's most important overseas market, with its residents making 686,000 overnight trips to Canada in 2009, despite an 18.1% decrease compared to the previous year. About one in six tourists from overseas countries came from the United Kingdom.

Among the top 12 overseas markets, Mexico posted the largest decline with a 37.3% drop from 2008. In the spring of 2009, Mexico was hit with several cases of the H1N1 flu. Later that year in July, it became mandatory for Mexican residents to have a visa to enter Canada.

Japan also continued its downward trend falling from fourth to fifth place among the top overseas markets to Canada with 30.4% drop in overnight travel to Canada.

The top four overseas markets to Canada in 2009 were the United Kingdom, France, Germany and Australia respectively.

Ontario remains most visited province

Travellers from overseas countries made 1.8 million overnight visits in Ontario in 2009, the most in any province and nearly 500,000 more than in second place British Columbia. Quebec rounded out the top three with 993,000 overnight visits. Nearly one in three overnight visits to Quebec were by residents of France.

Outbound market

Travel abroad decreased in all major categories in 2009. Business travel, which accounted for 10.6% of overnight trips outside Canada, decreased 12.8%. Business visitors from Canada on overnight trips spent an average of $176 per night, nearly twice as much as people on pleasure trips ($89), and three times as much as those visiting friends and relatives ($57).

Nearly seven out of ten overnight trips by Canadian residents in 2009 were to the United States. However, Canadians travelling to overseas destinations spent an average of 15.6 nights out of the country compared to an average of 7.9 nights in the United States. As a result, spending by Canadians on overnight trips abroad was almost evenly split between the United States and overseas countries.

Ontario residents travelled the most outside the country, making 45.5% of all overnight trips abroad in 2009. Just over half of the provinces recorded a decrease in overnight travel abroad, with Prince Edward Island recording the largest drop as 27.3% fewer residents took trips abroad. Residents of the Canadian territories took 3.3% more trips abroad, followed by Saskatchewan with 2.9% more trips outside of the country.

Overnight travel to the United States down in 2009

Canadian travel to the United States reached 18.0 million overnight trips in 2009, down 5.0% from 2008. This was the first decline in overnight travel to the United States since 2003.

With the decrease in travel, spending on overnight trips south of the border declined 2.0% compared to the previous year to $12.7 billion. Canadians stayed 142.6 million nights in the United States, with average spending per night of $89, an average length of stay of 7.9 nights per overnight trip.

About three out of five overnight trips to the United States, or 10.8 million, were by car, while overnight travel by plane climbed to a high of 6.1 million.

Overnight visits decrease in most top 12 states

Of the top 12 states, ten had decreases in overnight visits by Canadian travellers in 2009, with two of them posting double-digit decreases. Canadians made 2.9 million overnight visits in New York State, down 4.3% from 2008 and more than in any other state. In New York State alone, Canadians spent $920.9 million and stayed 8.3 million nights. Despite being the most visited state, New York ranked fourth in dollars and third in nights spent during overnight visits by Canadians.

Canadians spent $3.1 billion in Florida, and stayed 47.4 million nights. Both figures were significantly higher than those for any other state. By comparison, in both cases, California came second, with Canadians spending $1.1 billion and staying 10.8 million nights in that state.

On average, Canadians stayed the longest in Florida (17.9 nights per overnight visit) and spent the most in Nevada ($191 per night).

More than one in three Canadians travelling overseas visit Europe

Canadians made 4.2 million overnight visits to Europe in 2009, more than to any other region. Far behind was the region of Bermuda and the Caribbean, with Canadians taking 2.5 million overnight visits there.

Although Europe was the most visited region, Canadians made 8.3% fewer overnight visits there compared to 2008. Oceania was the only other region to post a decline in travel by Canadian residents (-0.9%). Overnight travel to South America jumped 13.5%, as did travel to the Caribbean (+10.3%).

Overall, Canadians made 8.2 million overnight trips overseas, 1.3% more than the high observed in 2008. Canadians however, spent $11.3 billion on trips overseas, down 2.3% from 2008.

On average, Canadians stayed 15.7 nights per trip overseas and spent $88 per night.

Sun destinations dominate overseas travel

Canadians made 1.2 million overnight visits to Mexico, more than to any other country. Despite the outbreak of H1N1 and rising concerns over drug-related violence, Canadians made 7.5% more overnight visits to the country compared to 2008.

Both Cuba and the Dominican Republic rounded out the top three. Canadian residents made 979,000 overnight visits to Cuba (+5.1%) while the Dominican Republic welcomed 876,000 Canadians, a 14.8% increase from 2008.

Four countries among the top 12 recorded declines in 2009 including the United Kingdom, France, Germany, and the Netherlands. The 14.2% decrease in overnight trips to the United Kingdom however knocked the country from second place in 2008 to fourth in the rankings in 2009.

With a record number of overnight visits to Mexico, Canadians also spent the most on overnight travel in Mexico. Canadian residents spent $1.3 billion in Mexico and stayed 12.3 million nights.

International travel account

Canada's international travel deficit rose $87.7 million to $12.2 billion in 2009, the fifth consecutive increase.

The increase in the deficit (the difference between spending by Canadians abroad and spending by foreigners in Canada) was mainly the result of lower spending by foreigners in Canada.

Foreign spending in Canada was at $15.5 billion, down 6.2% from the previous year. At the same time, Canadians spent $27.7 billion outside the country in 2009, down 3.3% from the record high of $28.6 billion set in 2008.

Travel deficit with the United States goes down

The travel deficit with the United States decreased $187.4 million to $8.7 billion in 2009. This was the first time in six years that spending by Canadian residents in the U.S. decreased. Despite the decline, the annual travel deficit with the United States is still nearly twice as high as in 2006.

Travel spending in the United States dropped to $15.8 billion, a decrease of $749.8 million from 2008. In contrast, spending by American residents in Canada decreased $562.4 million over the same time period.

2009 was the first time in seven years that the Canadian dollar lost in value against its U.S. counterpart. In 2008, the average value of the Canadian dollar was 93.8 US cents; in 2009 it was, 87.6 US cents.

Lower Canadian spending overseas slows deficit with overseas countries

The travel deficit with overseas countries fell $275.0 million to $3.5 billion. While overseas spending declined $187.3 million, Canadian spending overseas decreased $462.4 million.

Canadian residents spent $11.9 billion in overseas countries in 2009. This was a 1.5% decrease from the record high of $12.1 billion set in 2008, and the first decline in overseas spending since 1991. Overseas spending in Canada was up 5.2 % from 2008. Spending by overseas residents in Canada has increased every year since 2003.