The outlook for the tourist industry in 2004 is positive and, if the hospitality sector provides visitors with good value for money, employment levels and profitability should continue to rise.
Tourism Ireland, which operates a joint marketing campaign for the Republic and Northern Ireland, has planned to increase tourist traffic by 4.4 per cent, bringing in a total of 7.7 million visitors in the coming year.
The projections published by Tourism Ireland may be exceeded, now that recovery in the world economy has strengthened and consumer confidence in our major markets has grown. If the industry is to thrive, however, costs must be controlled. For, as the Central Bank pointed out in its latest bulletin, the price of goods in Ireland now exceeds the EU average by 12 per cent. Value for money is a key ingredient of success. It will enable the industry to build on the recovery in tourist numbers that was experienced in 2003, following two years of sharp decline.
When Tourism Ireland and Fáilte Ireland unveiled their plans, senior managers from both organisations suggested the increased traffic would not necessarily lead to higher profits for the industry. Revenues remained flat last year, in spite of an estimated 4 per cent growth in the number of tourists, because rising costs and competition from overseas put downward pressure on margins. The strong euro made overseas visitors more cost conscious. And shorter breaks meant that tourists spent less time and money in the country.
In the coming year, almost €200 million will be spent by the Government and the industry in promoting tourism. Moving up-market and attracting wealthier visitors will be a major part of that campaign, with golf, angling and other sports receiving special attention.
A Household Travel Survey, conducted by the Central Statistics Office in 2002 and published last month, showed the importance of the home market, with some 4.6 million Irish holidaymakers leaving for foreign destinations and 2.8 million taking domestic holiday trips.
Ireland is well positioned to build on its strengths as the world economy recovers. In the first six months of 2003, the number of visitors from the United States grew by more than 5 per cent, while the increase in European visitors amounted to almost 8 per cent. Similar advances are expected this year. But it will take hard work and innovation. Past surveys showed that more than 50 per cent of our visitors were dissatisfied with high service charges, the cost of eating out and the price of drink. If the industry addresses those concerns in a determined way, it can look forward to a healthy future.