Response to "(Canadian) Tourism Woes under Recognized" and "Liberal oversimplistic view of Tourism Industry"

I need to take a break from my coverage of ITB Berlin and the Bloggers Summit to write in response to two pieces that have been written in recent days about Canadian Tourism that deal with the issue of government (or party) support for the industry. These two articles stimulate debate on the matter and therefore I feel the need to dive in myself.

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The first piece, "Tourism Woes under Recognized," appeared in the CTC's Tourism Daily bulletin on February 29. The article deals with an article from the Cambridge Times by Ray Martin in which he quotes Ms. Susan Cudahy, the general manager of the Waterloo Regional Tourism Marketing Corporation: "The tourism sector is in the same boat as the manufacturing sector these days, you just don't hear about it as much," Cudahy told members of the city's economic development advisory committee recently. "The tourism sector is hurt, thousands of jobs have been lost and it's not coming back."

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My first comment is about the thousands of jobs that have been lost. Whenever I read a statement like this one I want to know where are the numbers and data that back up the statement. For some years now I have been hearing from different parties in the industry that the Canadian Tourism industry is hurting. However, other than the SARS problem back in 2003 and even with the high dollar in recent months, I have to disagree with statements like these. While it is true that some businesses have been hurt by the decline in US visitations over the last several years, most of these are businesses that depended on cross border same day visitos. As Ms. Cudahy mentions in the article from the Cambridge Times, nowhere is this more evident than in Niagara Falls. However, those businesses are only a small part of the canadiant tourism industry. To back up my position I present to you official data from the CTC about the state of the industry in dollars:

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Total Tourism spending in the third quarter of 2007 was up 5%

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In 2006 Total tourism expenditures reached $66.8 billion, an increase of 6.5% over 2005.

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Total tourism results were positive across all tourism commodities, with spending on accommodation up 7.6%, passenger air transportation up 9.5%, and food and beverage services up 6.3%.
Spending by Canadians traveling in Canada reached $50.3 billion, up 10.1% from 2001.

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Foreign spending had a decline of 3.2% from the previous year, totaling $16.5 billion. This decline was a result of the 2.7% drop in international overnight visitors, primarily impacted by fewer American visitors.

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Total tourism employment reached 633,600 full and part-time jobs in 2006, up 1.9% from the previous year. (source Canadian Tourism Performance)

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The figures above paint a very different picture from the one Ms Cudahy refers to (tourism sector is in the same boat as manufacturing - thousands of jobs have been lost). The reality is that in manufacturing there is a definite and documented contraction where in Ontario and Quebec alone over 100,000 jobs have been lost in the last few years, whereas in the tourism sector there are times and places where not only it is true that no jobs have been lost, but to the contrary - this season in Whistler, for example, the lack of toursim workers was such that the entire village is mostly run by Australian and British young people (if your were in Whistler, January 26, Australia Day, you would have visually confirmed this statement).

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In conclusion, we cannot, as an industry cry wolf to the government, when no wolf really exists. The issue of the high Canadian dollar is of concern, but it has not hit the industry as badly as it has the manufacturing sector. Recall that 75% or so of the industry's revenues come from domestic tourism (see The Year ahead...)

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On the second piece, "Liberal oversimplistic view of Tourism Industry," Ron Taylor's article on this blog. I must say that politics is politics no matter what party is involved. I agree with the fact that it may be naive to think that China will flood our country with tourists if we were to get the ADS. For one thing, in order to reach 700,000 visitors from China annually, it would require 3,181 flights from China with 220 passengers each - or 8.7 flights every single day. The lift is not there and I don't think it will be for a long time.

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As for the Chretien legacy and the issue of whether or not it was antagonistic to the US, I don't really want to get into a political debate. Suffice it to say that Mr. Chretien's decision not to support the Iraq war is the same reason why Senator Obama is getting so much support on his bid for the US presidencial candidacy. As for the tories and the alleged mismanagement of negotiations with China, to me is just more politics where the opposition tries to use anything to make the government look bad. The Liberal critic for Tourism says that "The Harper government’s lack of a nuanced approach to China" hurts the ability to negotiate. My personal opinion is that sometimes, when it comes to the issue of human rights, nuances are not possible. Should Canada beg for ADS and turn a blind eye to human rights issues for the sake of trade?

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Feel free to join this debate by leaving us your comments.

Regards,
Jaime
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