Top ten insights for 2010

1. Top ten insights for 2010 April 2010

2. 1. Inbound tourism recovering, but only slowly • We forecast inbound visits to Britain to grow by 1% and visitor spending to increase by 4% • We will not return to the record visitor numbers seen in 2007 until at least 2011 • UNWTO forecast global growth of 3% in 2010 after 4% decline in 2009 • IATA anticipate global air travel back to pre-recession levels by summer 2010

3. 2. Economic recovery will be fragile • Asia is growing strongly • Demand for oil could see prices stay high • Europe and North America is lagging behind • Many countries face a debt crisis • UK may be in the firing line after Election • A ‘double-dip’ recession in the UK cannot be ruled out • Small businesses still struggling to secure finance

4. 3. The decade of austerity starts here • Public sector broadly immune from recession in 2008 and 2009 • Likely to see substantial public sector spending and job cuts in 2011-12 • Industrial strife possible across many sectors • Consumers will face higher taxes • Challenging environment in which to call for APD hike due in November to be withdrawn • Other ‘green’ taxes or infrastructure decisions may impact on tourism’s potential to grow

5. 4. Geopolitics • Global tourism came through a pandemic relatively unscathed • Terrorism, and the threat of terrorism, remains a risk to many countries • Measures to ensure air travel is secure must be implemented in the least burdensome way • Equally true for visa regimes • Tensions in Iran and the wider Middle East are running high – helping to keep oil prices high • Situation in Thailand is unstable

6. 5. Britain can still exploit the ‘value’ message Volatility is the watchword for 2010

7. 6. Leisure travel remains more resilient than business travel • Corporate travel budgets remain under strain • Volumes may start to return, but yields from business travel will lag • Exchange rate will help sustain growth in inbound holiday tourism • The ‘staycation’ effect was real and could persist in 2010, but good weather may be key

8. 7. Competition for international tourism remains fierce Destinations with positive growth in 2009 Turkey, South Africa, Cuba, Peru, Cambodia, Bahrain, Montenegro, Morocco

9. 8. Britain has unique strengths • With authenticity a crucial ingredient for destination success Britain must leverage our core strengths while broadening our appeal • Our Culture and Heritage offer underpins up to £4.5bn worth of inbound visitor spending pa • Can further exploit our natural scenic beauty as this is less well known overseas than our culture and heritage • London and Britain will become increasingly the focus of global media as 2012 Games approach

10. 9. Barriers remain to be overcome • Despite exchange rates many still perceive Britain as an expensive destination • Perceptions of the ‘welcome’ Britain offers are mediocre among those who have not visited • Perceptions of food and weather are poor among non-visitors, but not seen as significant barriers to visit • Many Brits still think/find booking an overseas holiday easier than booking domestic break

11. 10. With right support tourism can be a growth industry for Britain • Visitor Economy is worth £115bn today, £188bn by 2020 • Gross Value Added could grow by 3.5% pa through to 2020, compared with overall economic GVA growing at 2.9% pa • Potential to support an additional 250,000 jobs by 2020 • Inbound spend has potential to grow at 4.4% pa, domestic spend 2.6% pa over next decade • Inbound visitors contribute £3bn pa in taxes