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World travel expected to rise 4% to 5% in 2006

In 2005 international tourism sustained the sharp upturn that began in 2004 in spite of the various tragic events it had to contend. According to preliminary results presented today by the United Nations specialized agency, the World Tourism Organization (UNWTO) the number of international tourist arrivals recorded worldwide grew by 5.5% and exceeded 800 million for the first time ever.

Although 2005 was certainly a tumultuous year, international tourism has fared amazingly well. Despite various terrorist attacks and natural disasters, such as the aftermath of the Indian Ocean tsunami and an extraordinarily long and strong hurricane season, the recovery, which started in 2004, continued firmly through 2005. Even though the disruptions experienced definitely left traces locally in the short-term, they did not substantially alter the global or regional traffic flows.

Based on detailed results for a large number of destinations included in the January issue of the UNWTO World Tourism Barometer the number of international tourist arrivals in 2005 is estimated at 808 million, up from 766 million in 2004. This corresponds not only to an increase of 5.5%, but also means a consolidation of the bumper growth achieved in 2004 (+10%). Although growth was more moderate, it still almost 1.5 percentage points above the long-term average annual growth rate of 4.1%.

UNWTO Secretary-General, Francesco Frangialli commented “The tourism sector has gained substantially in resilience over the past years. In spite of the turbulent environment we live in nowadays, destinations worldwide added some 100 million international arrivals between 2002 and 2005.”

Prospects for 2006

For 2006 the current pattern of gradually slowing growth is expected to continue. In cooperation with the Fundación Premio Arce of the Universidad Politécnica de Madrid a short-term forecast has been elaborated according to which international tourist arrivals worldwide are expected to grow between 4 - 5% in 2006. Growth is projected to be around one percentage point lower than in 2005 but still somewhat above the forecast long-term annual growth rate of 4.1%.

This outlook is supported by the continued good shape of the world economy in most parts of the world and the improved prospects for the eurozone economies, in particular its most important source market Germany.

Three major uncertainties remain for 2006. First, it is likely that terrorism will continue to be present. However, experience shows that its impact lately has been rather limited and short-lived. Travellers overall have assumed the risk and have been undeterred by external threats. Secondly, rising energy prices, inflation and interest rates might finally change the economic scenario. This has not been much of a problem until now, as the price hike has mostly been an expression of the strong economic growth and the corresponding demand for energy. Should this situation continue and affect economic growth in Asia , the tourism industry could start feeling the impact.

Finally, the further spread of avian flu could be a serious threat for the tourism sector. Avian flu has been present in the world for several years now and it is currently limited to birds and isolated cases of people living in very close contact with infected animals. As yet no transmission of the virus between humans has been detected and it is hard to say whether, when and where such a mutation will occur. For the moment there is no reason to change travel plans as long as recommendations issued by national and local health and veterinary authorities are respected.

“Panic is always a bad advisor”, says Mr. Frangialli. “What we can do is to monitor the situation closely and prepare for it, should it happen. In spite of the current uncertainties I am confident that world tourism and all its stakeholders will weather the storm - if it does come - in the best way possible.”

( www.business-standard.com)

 
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