European Tourism in 2014: Trends & Prospects (Q4/2014) 1
EUROPEAN TOURISM in 2014: TRENDS & PROSPECTS
Quarterly Report (Q4/2014)
A quarterly insights report produced for the Market Intelligence Group
of the European Travel Commission (ETC)
by Tourism Economics (an Oxford Economics Company)
Brussels, February 2015
ETC Market Intelligence Report
Copyright © 2015 European Travel Commission
European Tourism in 2014: Trends & Prospects (Q4/2014)
All rights reserved. The contents of this report may be quoted, provided the source
is given accurately and clearly. Distribution or reproduction in full is permitted for
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The designations employed and the presentation of material in this publication do
not imply the expression of any opinions whatsoever on the part of the Executive
Unit of the European Travel Commission.
Data sources: This report includes data from the TourMIS database /
http://www.tourmis.info, STR Global, IATA, AEA and UNWTO.
Economic analysis and forecasts are provided by Tourism Economics and
are for interpretation by users according to their needs.
Published and printed by the European Travel Commission
Rue du Marché aux Herbes, 61, 1000 Brussels, Belgium
Website: www.etc-corporate.org
Email: [email protected]
ISSN No: 2034-9297
This report was compiled and edited by:
Tourism Economics (an Oxford Economics Company)
on behalf of the ETC Market Intelligence Group
Cover: Trakai Castle, Trakai, Lithuania copyright photoff, http://www.shutterstock.com/gallery-401758p1.html
Foreword
European tourism grew strongly and steadily in 2014
2014 sets European tourism on a record growth path. UNWTO
1 , the UN agency for tourism, estimates that
the European tourism sector grew by 4% last year, reaching a total of 588 million visits, a 22 million increase compared to 2013. For the fifth consecutive year, international tourism in the region has grown above the 2.4% average rate forecast for the period 2010-2025
2.
Data reported by ETC members through November-December 2014 exceed the positive trend reported by the UN agency. Two out of three ETC destinations report growth above the regional performance (top chart). As to be expected, most of them are emerging destinations who are investing in their tourism potential, such as Iceland (+24%), Latvia (+15%), Serbia (+12%), Romania and Czech Republic (both at +11%).
Among them, established destinations in Southern and Mediterranean Europe stand out. In the area, growth is led by large destinations such as Greece (+22%), driven by the recovery of business travel and price convenience, and Spain (+9%), whose vibrant sector earned the praise of its Prime Minister for its excellent contribution to the Spanish economy
3. Malta (+7%), Slovenia (6%), Croatia (+5%) and
Turkey (+5%) also contribute positively to the outstanding performance.
A profitable business all across the value chain
Positive trends are mirrored in performance indicators from the hotel sector. Confidence remains high within this sector, where data point to improved occupancy and profits. Average Daily Rates (ADR) rose at most destinations in Europe over the last 12 months, a consequence of significant growth in occupancy across the region.
Air traffic data for Europe also grew at a faster pace than the previous year (middle chart). Despite repeated disruptions caused by strikes in the last quarter of 2014, Passenger Load Capacity was reported at marginally higher rates than in 2013. Air passenger traffic between Europe and the Americas grew substantially thanks to a strengthening dollar and recovering economies in the euro area.
1Source: http://media.unwto.org/press-release/2015-01-27/over-11-billion-tourists-
travelled-abroad-2014.
2Source: https://ec.europa.eu/growth/tools-
databases/vto/documents?name_list=All&field_type_tid=9040&field_year_value=All&items_per_page=10&=Apply
3 Source: http://www.ifema.es/fitur_01/Prensa/NotasdePrensa/INS_048375
Foreign visits to ETC destinations in 2014YTD, % change year ago.
Europe: 4%
Source: TourMIS
-20
-10
0
10
20
30
Icel
and
Gre
ece
Latv
iaS
erbi
aR
om
ani
aC
zech
Rep
.S
pain
Lith
uan
iaIr
elan
d R
epM
alta
Slo
veni
aC
roa
tiaT
urke
yB
elgi
umG
erm
any
Pol
and
Eur
ope
Hu
nga
ryE
ston
iaB
ulga
ria
Aus
tria
Mon
tene
gro
Sw
itze
rland
Cyp
rus
Italy
Slo
vaki
a
Africa Asia/Pacific Europe LatinAmerica
Mid.East N.America World
0
5
10
15
202012 2013 2014 ytd
% year, RPK
Source: IATA
Annual international air passenger growth
Outbound travel from select markets to the world and EuropeAnnual average growth (%), 2014-19.
Source: Tourism Economics
0
2
4
6
8
10
Ru
ssia
US
A
Ca
nad
a
Mex
ico
Arg
entin
a
Bra
zil
Indi
a
Ch
ina
Jap
an
UA
EWorld Europe
Long-haul markets lead growth, on top of a strong regional market
Factors that contributed to a successful year include: the recovery of major source markets, marketing efforts in promoting travel outside the main season and themed promotional activities. Many destinations benefitted from increased travel from Europe’s top markets, such as France, Germany, Italy and the UK. Data point to a recovery during short breaks, in addition to the main holidays, as suggested by increases in overnights, shorter lead times and more last-minute bookings. While growth from Germany and the UK is consistent with economic trends, the behaviour of the French and Italian markets clearly reflects the hedonic nature of travel consumption. In 2015, the Eurozone recovery is expected to finally pick up the pace (+1.3%), which bodes well for the regional market remaining a stalwart supporter of growth.
Data paint a bleaker picture for the Russian market, especially as the crisis in Eastern Ukraine shows no sign of abating. Outbound travel from this market is expected to mirror the deep economic recession expected in 2015, largely caused by the devaluation of the Rouble and falling price of oil, and associated with capital flight in emerging markets. A recovery of the market is expected in the medium term (bottom chart on previous page), as illustrated in ETC report “European Tourism amid the Crimea Crisis”, although the twin impact of falling oil prices and a possible renewal of sanctions will further weaken the market throughout 2015.
In the US, accelerated economic growth, the appreciation of the dollar against the euro and decreasing air fares have contributed to strong performance in this market. Consumer spending is expected to become stronger, backed up by an improved labour market and sustained GDP growth, as reflected in an average growth of +5% per year through 2019. A similar optimistic outlook is reported for China, a market sized at 26 million arrivals to long-haul destinations in 2014, and whose growth in Europe is projected at a substantial rate of 6% per year over the next few years. Third-tier long-haul markets, such as Argentina and the UAE, also show positive prospects in the short term, while the picture remains gloomier for Brazil and Japan, as a reflection of a deteriorated economic situation. For the latter, the Japan National Tourism Organization reports a steady decline in outbound travel from Japan, at a level currently below 2011 volumes.
Sailing through rough seas?
A number of factors bode well for another positive year in Europe’s tourism sector. Due to lower energy prices, a weaker euro, continuing reforms, and a likely new round of stimuli from the European Central Bank, it is reasonable to expect continued growth from the regional market. Nevertheless, adverse risks may partly offset favourable risks as the year progresses. Following the January events in Paris, the threat of more terror attacks in Europe may produce ripple effects to other European destinations. Markets in Asia, where safety is a key factor for travel-related decisions, and the USA may prove particularly vulnerable to increasing tensions. Growth prospects for the Eurozone may also fail, under the threat of intensified adverse risks, such as deflation and persisting unemployment.
Dark clouds may be gathering over the waters on which European tourism is sailing and slow down its growth. For 2015, the ETC expects the European tourism sector to continue at a cruising speed around its long-term annual average growth, forecast at a rate between 2% and 3%.
Valeria Croce, ETC Executive Unit
ETC Market Intelligence Group
European Tourism in 2014: Trends & Prospects (Q4/2014) 1
© European Travel Commission, February 2015
2014 Tourism Performance Summary
Emerging Europe continues to live up to its name with strong arrivals growth across the majority
of its reporting constituents, namely Latvia, Serbia, Romania, and Czech Republic, all of which
have so far this year enjoyed in excess of 10% growth. Latvia and Serbia both reported arrivals
growth from Russia according to YTD figures to September and November respectively. This
contrasts starkly with the fall in Russian arrivals that most other countries have observed due to
a combination of factors, namely a tumbling rouble, falling oil prices, and the response to
sanctions related to the Russia-Ukraine crisis. However, with only data to September, the
marginal growth in Russian arrivals to Latvia (0.6%) is unlikely to be evident in final end-year
data given the fall in oil price and the relative value of the rouble against the euro. Latvia has
shown itself to be a diverse destination, maintaining momentum despite a fall in nights and only
very weak arrivals growth from Russia, its largest source market.
Growth in arrivals from Russia to Serbia have been much more robust; YTD data to November
shows growth and is unlikely to see less than full year double digit growth from Russia. Taken
together with strong double digit arrivals growth from many other large source markets such as
Austria, Switzerland, France, Poland, and Sweden, to name only a few, it is no surprise to see
Serbia as a top performer amongst ETC+3 countries.
Spain continued to demonstrate its appeal as a European destination, with growth in arrivals to
September of 9.2%. Moreover, in terms of visitor nights, Spain saw the largest increase
compared to the same period (January to September) in 2013 of 12%. Italy struggled to find
visitor nights growth early on in the year, but data to October suggests a strong summer which
made up for this shortfall and restored Italy’s visitor nights growth back into positive territory.
Like Spain, Italy’s reputation as a European destination precedes itself, however, its future
success is perhaps a bit more fragile than Spain’s, posting growth figures of 1.2% and 0.5% for
visits and visitor nights respectively.
2014 growth suggested by strong YTD figures in all but one reporting country should help stave
off the winter freeze. With the majority of countries reporting data to November and full-year
data available for three of these, we can surmise that reported trends are indicative of full year
performance. Iceland has been a front-runner since the beginning of the year, maintaining
impressively high levels of arrivals growth throughout. Off-season marketing campaigns,
increased presence in TV and film, and currency movements favouring the foreign visitor have
all contributed. The recovery in Greece continues, as the second strongest performer in terms
of arrivals growth. Hotels data for Athens support the idea that business demand is partly
responsible for this performance, reducing the recent reliance on the Greek islands for growth.
Greece should continue to grow if its economy grows in 2015 as it did in 2014, however,
uncertainty relating to its status within the EU may act as a stumbling block.
-10
-5
0
5
10
15
20
Spain
Latv
iaP
ort
ugal
Neth
erlands
Serb
iaS
weden
Denm
ark
Czech R
ep
Norw
ay
Lithuania
Belg
ium
Malta
Germ
any
Pola
nd
Luxem
bourg
Cro
atia
Hungary
Esto
nia
Slo
venia
Sw
itzerland
Italy
Austr
iaF
inla
nd
Cypru
sS
lovakia
Foreign visitor nights in select destinations2014, year-to-date*, % change year ago
Source: TourMIS *date varies (Jan-Sep) by destination
-11.1-10
-5
0
5
10
15
20
Icela
nd
Gre
ece
Latv
iaS
erb
iaR
om
ania
Czech R
ep
Spain
Irela
nd R
ep
Lithuania
Malta
UK
Slo
venia
Turk
ey
Cro
atia
Germ
any
Belg
ium
Pola
nd
Hungary
Esto
nia
Bulg
aria
Sw
itzerland
Monte
negro
Austr
iaC
ypru
sItaly
Slo
vakia
Foreign visits to select destinations2014, year-to-date*, % change year ago
Source: TourMIS *date varies (Jan-Dec) by destination
24.1
-13.0
22.2
2 European Tourism in 2014: Trends & Prospects (Q4/2014)
© European Travel Commission, February 2015
Only Austria, Finland, Cyprus, and Slovakia have seen falling visitor nights and, of these, only
Slovakia has a fall in both visits and visitor nights when compared to the same period one year
prior.
Cyprus saw arrivals from Russia, its second largest source market based on 2013 arrivals
figures, increase by 4.6% compared to the same period in 2013. However, this was not enough
to offset a 2.2% fall in visits from the United Kingdom, Cyprus’ largest source market from which
it received twice as many visits in 2013 as from Russia.
Finland’s full year performance is likely to be muted; YTD data to October has shown a large
negative impact on visitor nights from Russia, its largest source market. Visitor nights from
Germany, its third largest source market, have also fallen marginally compared to the same
period last year. While it is possible that data for the final two months of 2014 will reveal visitor
nights growth from Germany, in the case of Russia the opposite is likely to be true due to
depreciation of the rouble relative to the euro which we know continues throughout the months
of November and December.
Slovakia’s performance shows some tentative sign of improvement according to YTD data to
September. Trends in both visits and visitor nights are marginally better than data from earlier in
the year. STR Global hotel data also shows massive improvement in demand and occupancy in
the final months of the year offsetting earlier falls. Final data for 2014 may end higher than the
falls implied in available arrivals and visitor nights data for the year to September.
Country % ytd to month % ytd to month
Austria 1.8 Jan-Oct -1.0 Jan-Oct
Bulgaria 2.2 Jan-Nov
Croatia 5.3 Jan-Dec 2.2 Jan-Dec
Cyprus 1.5 Jan-Dec -2.9 Jan-Sep
Czech Rep 10.7 Jan-Sep 7.5 Jan-Sep
Denmark 8.1 Jan-Nov
Estonia 3.2 Jan-Nov 0.9 Jan-Nov
Finland -1.8 Jan-Oct
Germany 4.3 Jan-Nov 4.6 Jan-Nov
Greece 22.2 Jan-Sep
Hungary 3.9 Jan-Nov 2.0 Jan-Nov
Iceland 24.1 Jan-Dec
Ireland Rep 8.6 Jan-Nov
Italy 1.2 Jan-Oct 0.5 Jan-Oct
Latvia 15.2 Jan-Sep 9.9 Jan-Sep
Lithuania 8.0 Jan-Sep 6.1 Jan-Sep
Luxembourg 2.5 Jan-Oct
Malta 7.0 Jan-Nov 5.0 Jan-Nov
Montenegro 1.8 Jan-Nov
Netherlands 9.4 Jan-Sep
Norway 6.4 Jan-Oct
Poland 4.1 Jan-Nov 3.9 Jan-Nov
Portugal 9.6 Jan-Oct
Romania 11.0 Jan-Nov
Serbia 11.7 Jan-Nov 9.2 Jan-Nov
Slovakia -13.0 Jan-Sep -11.1 Jan-Sep
Slovenia 5.7 Jan-Oct 0.9 Jan-Oct
Spain 9.2 Jan-Sep 12.0 Jan-Sep
Sweden 8.2 Jan-Oct
Switzerland 1.8 Jan-Nov 0.6 Jan-Nov
Turkey 5.3 Jan-Nov
UK 7.0 Jan-Nov
Source: TourMIS, http://www.tourmis.info; available data as of 2.2.15
Measures used for nights and arrivals vary by country
See TourMIS for further data including absolute values.
Tourist Arrivals and Nights
2014 Performance, Year to Date
International Arrivals International Nights
European Tourism in 2014: Trends & Prospects (Q4/2014) 3
© European Travel Commission February 2015
Global Tourism Forecast Summary
Tourism Economics’ global travel forecasts are shown on an inbound and outbound basis in
the following table. These are the results of the Tourism Decision Metrics (TDM) model,
which is updated in detail three times per year. Forecasts are consistent with Oxford
Economics’ macroeconomic outlook according to estimated relationships between tourism
and the wider economy. Full origin-destination country detail is available online to subscribers.
2012 2013 2014 2015 2016 2012 2013 2014 2015 2016
data/estimate/forecast *** d d e f f d d e f f
World 4.5% 5.1% 5.0% 3.3% 4.7% 4.0% 4.8% 5.2% 3.3% 5.0%
Americas 4.9% 3.3% 7.5% 4.2% 4.7% 5.9% 3.0% 3.6% 4.6% 5.1%
North America 4.7% 3.9% 8.2% 4.2% 4.5% 5.3% 2.2% 2.8% 5.6% 5.4%
Caribbean 3.3% 2.2% 6.1% 3.3% 4.6% -1.5% -1.8% 5.0% 2.4% 5.1%
Central & South America 6.4% 2.4% 6.2% 4.6% 5.6% 9.4% 6.6% 5.8% 1.8% 3.9%
Europe 3.8% 6.0% 3.9% 1.3% 3.6% 3.7% 3.9% 3.7% 0.8% 3.7%
ETC+3 2.7% 5.7% 5.0% 2.5% 3.7% 1.7% 1.8% 4.9% 2.8% 4.1%
EU 2.9% 5.3% 4.5% 2.1% 3.4% 1.3% 1.5% 4.9% 3.0% 4.2%
Non-EU 7.1% 8.7% 2.0% -1.5% 4.0% 11.7% 11.1% 0.4% -5.5% 2.1%
Northern 3.9% 4.2% 6.6% 2.9% 3.9% 2.9% 3.1% 5.9% 2.7% 4.5%
Western 3.2% 5.2% 2.1% 1.6% 2.3% 3.3% 1.2% 4.8% 3.6% 3.9%
Southern/Mediterranean 1.5% 6.5% 8.0% 3.2% 4.4% -2.9% -0.2% 5.8% 1.4% 2.7%
Central/Eastern 7.8% 7.0% -0.7% -3.1% 3.6% 6.9% 9.3% 0.0% -4.1% 3.4%
- Central & Baltic 5.1% 5.8% 2.9% 2.0% 4.6% 3.0% 4.8% 2.7% 2.3% 5.4%
Asia & the Pacific 6.7% 6.1% 5.7% 5.9% 6.7% 7.3% 7.2% 6.3% 5.8% 6.7%
North East 6.0% 3.5% 7.3% 6.9% 6.8% 8.4% 7.5% 6.8% 5.7% 6.6%
South East 8.9% 10.2% 3.0% 4.5% 6.7% 5.5% 7.9% 2.5% 5.5% 6.8%
South 3.6% 6.7% 9.0% 7.9% 6.7% 4.7% 2.7% 15.9% 9.9% 8.1%
Oceania 2.4% 4.1% 6.3% 3.9% 5.3% 5.0% 5.3% 5.0% 2.7% 5.9%
Africa 8.4% -0.9% 4.7% 5.8% 5.1% 7.6% 2.0% 5.2% 5.7% 5.1%
Mid East -3.1% 4.0% 5.4% 6.4% 5.9% -10.3% 5.3% 12.8% 4.7% 5.8%
* Inbound is based on the sum of the country overnight tourist arrivals and includes intra-regional flows
** Outbound is based on the sum of visits to all destinations
Note: world inbound and outbound do not match exactly in historic data or forecast. This is due to visits to multiple destinations.
For example, one outbound trip may be to more than one destination. Some sample error may also be evident in historic data.
*** d - data reported by national statistical agencies are available for all years to 2012
e - 2013 estimated using all available year-to-date data, and forecasts for the rest of the year
f - forecasts according to Tourism Economics' global economic and tourism forecast models
ETC+3 = ETC members plus France, Netherlands, and UK
EU = Austria, Belgium, Bulgaria, Cyprus, Czech Republic, Denmark, Estonia, Finland, France, Greece, Germany, Hungary,
Ireland, Italy, Latvia, Lithuania, Luxembourg, Malta, Netherlands, Poland, Portugal, Romania, Slovakia,
Slovenia, Spain, Sw eden, UK
Non-EU Europe is all European countries (listed below ) outside EU
Northern Europe = Denmark, Finland, Iceland, Ireland, Norw ay, Sw eden, UK
Western Europe = Austria, Belgium, France, Germany, Luxembourg, Netherlands, Sw itzerland
Southern/Mediterranean Europe = Albania, Bosnia-Herzegovina, Croatia, Cyprus, FYR Macedonia, Greece, Italy, Malta,
Central/Eastern Europe = Armenia, Azerbaijan, Bulgaria, Czech Republic, Estonia, Hungary, Kazakhstan, Kyrgyzstan, Lativia,
Lithuania, Poland, Romania, Russian Federation, Slovakia, Ukraine
of w hich
Central Europe & Baltic countries = Bulgaria, Czech Republic, Estonia, Hungary, Latvia, Lithuania, Poland, Romania, Slovakia
TDM Visitor Growth Forecasts, % change
Outbound**Inbound*
4 European Tourism in 2014: Trends & Prospects (Q4/2014)
© European Travel Commission, February 2015
Recent Industry Performance
Growth continues, overcoming some hurdles along the way…
European international air transport growth is strong in 2014
More industry strikes have had some negative impact on an otherwise strong
year for air travel growth
Travel growth between Europe and long haul markets continues to outpace total
European air passenger traffic growth
European hotel occupancy and room rates have grown in 2014 to date with the
best overall performance of any World region, despite falls in eastern Europe
Air Transport
Air passenger data to November shows growth in all
regions, with the exception of Africa. Annual international
revenue passenger kilometers (RPK) growth for African
carriers has slipped into negative territory. This weakness
appears to reflect adverse economic developments in parts
of the continent, particularly those which are reliant on oil
revenues, while localised ebola related fears have also
depressed demand. Middle Eastern carriers enjoyed
particularly impressive growth, notably in September which
saw RPK grow by 15.8% compared with the same month in
2013. Growth in November was 11.7% - the region’s fourth
consecutive double-digit reading. While Middle Eastern
economies are feeling the pinch of plunging oil revenues, for
most of these the cost of oil extraction remains well below
the current market price.
With only one more month of data required to complete the
picture for 2014, it looks likely that almost all regions will see
full year RPK growth higher than in 2013, with Africa and
Latin America the only exceptions. European airlines posted
RPK growth of 5.6% in November compared to the same
month in 2013.
-5
0
5
10
15
20
Africa Asia/Pacific Europe LatinAmerica
Mid.East N.America World
Aug-14 Sep-14 Oct-14 Nov-14
% year
Source: IATA
Monthly international air passenger growth
-12
-9
-6
-3
0
3
6
9
12
15
18
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
RPK = revenue passenger kms
Source: IATA
3 month moving average
Icelandic Ash Cloud Impact
International air passenger traffic growth% year, RPK
Africa Asia/Pacific Europe LatinAmerica
Mid.East N.America World
0
5
10
15
202012 2013 2014 ytd
% year, RPK
Source: IATA
Annual international air passenger growth
European Tourism in 2014: Trends & Prospects (Q4/2014) 5
© European Travel Commission February 2015
Data from the Association of European Airlines (AEA) shows lower European airline capacity in Q4.
Strikes by Lufthansa pilots for two days in December as well as a 24 hour strike at Brussels airport
(BRU) caused disruptions to European airline capacity in the quarter. However, these were minor
in comparison to the steep fall in capacity growth coinciding with strike action taken by employees
of Air France and Lufthansa – Europe’s two biggest carriers – in September. During the two weeks
of these strikes air capacity shrank by over 5% compared to the same weeks in 2013, with some
50-60% of these airlines’ services grounded in the first few days of the 14 day strike.
Passenger load factor (PLF) appeared to follow a broadly similar pattern as in 2012 and 2013, with
the exception of the higher utilisation rates coinciding with the reduction in supply due to the airline
strikes in September. PLF fell for much of the fourth quarter relative to earlier in the year, following
the typical seasonal pattern, but at marginally higher rates than in 2013.
On the whole, air passenger traffic between Europe and the Americas continues to grow at a faster
rate than total travel to and from Europe in 2014 data to date, in some part due to recovering
European economies. However, United States outbound travel to Europe has also been particularly
strong this year, helped by the strengthening dollar, a driving force of this growth.
Travel between Europe and Asia has also increased at a faster rate than total European airline
passenger growth throughout most of 2014, largely driven by emerging Asia economies and their
growing ability to travel long haul in line with economic trends in the region. Growth has slowed
notably in early data for the start of 2015. This is a concern given the slowing trend in Chinese
consumer spending, but we expect faster growth to resume.
-5
0
5
10
Q1 Q2 Q3 Q4
2012 2013 2014
ASK, 4 week moving average, % change year ago
Source: AEA
European airlines capacity
60
65
70
75
80
85
90
Q1 Q2 Q3 Q4
2012 2013 2014
Weekly load factor, %
Source: AEA
European airlines passenger load factor
-4
-2
0
2
4
6
8
10
12
14
201
2Q
1
2012Q
2
2012Q
3
201
2Q
4
2013Q
1
2013Q
2
2013Q
3
2013Q
4
2014Q
1
2014Q
2
2014Q
3
2014Q
4
2015Q
1
Americas Total
RPK, 4 week moving average, % change year ago
RPK = revenue passenger kmsSource: AEA
European airline passenger traffic: Americas
-4
-2
0
2
4
6
8
10
12
14
201
2Q
1
201
2Q
2
201
2Q
3
201
2Q
4
201
3Q
1
201
3Q
2
201
3Q
3
201
3Q
4
201
4Q
1
201
4Q
2
201
4Q
3
201
4Q
4
201
5Q
1
Asia Total
RPK, 4 week moving average, % change year ago
RPK = revenue passenger kmsSource: AEA
European airline passenger traffic: Asia
6 European Tourism in 2014: Trends & Prospects (Q4/2014)
© European Travel Commission, February 2015
The European hotel sector performed well, growing across all hotel performance measures for
2014 as a whole. This is despite eastern Europe performance acting as a drag on what would
otherwise have been growth across the board. Occupancy in the region fell by 4%, while ADR and
RevPAR fell by 9.1% and 12.8% respectively in dollar terms. Northern Europe and southern Europe
both grew impressively in 2014, the latter enjoying 3.1%, 8.3%, and 11.6% increases in occupancy,
ADR, and RevPAR respectively, and the former seeing occupancy, ADR, and RevPAR grow by
3.5%, 2%, 5.6% respectively.
Within eastern Europe, Russia was by far the biggest brake on performance owing to its size within
the region; Russian occupancy, ADR, and RevPAR all fell by 12.9%, 2.2%, and 14.8% respectively,
compared to the same period last year, denominated in its local currency. Denominated in euro
terms the fall is much more extreme given the rate at which the rouble has depreciated over the last
number of months, with ADR down 18% and RevPAR 28.6%. Hoteliers have been largely holding
prices stable for the domestic market, with no attempts made to cut ADR as a means of spurring
much needed foreign demand in the midst of tensions and potential conflict, even before the more
recent oil price and rouble movements.
While the fall in the rouble in itself would make Russia a more attractive destination in terms of the
lower ADR when taken in euro terms (down 18% on the same period in 2013) or pound terms
(down 22.5%), the Russia-Ukraine crisis continues to deter visitors, and dampens this price effect.
The same currency movement raises cost for travel from Russia to the rest of Europe and can help
explain weak performance in key destinations, notably elsewhere in eastern Europe.
Elsewhere, in northern Europe, Ireland and the UK are forging ahead, particularly in terms of ADR,
both countries enjoying respective growth of 9.4% and 11.2% in euro terms. Occupancy rates grew
by 3.7% and 3% respectively compared to the same period in 2013.
Accommodation In 2014, all regions saw growth across all measures of hotel performance for the year as a whole,
denominated in dollar terms. The exception is Asia/Pacific which only saw occupancy rates
increase compared to the same period last year. Within the region, only south-east Asia was a drag
on occupancy, it being the only sub-region within Asia/Pacific to post a fall in occupancy rates
based on full year data. This can be traced back to the civil unrest in Thailand in the summer. In
terms of average daily rate (ADR) and revenue per available room (RevPAR), each constituent of
the region played its part in contributing to the fall, suggesting that appreciation of the dollar may be
to blame.
Middle East/Africa has seen the largest growth in occupancy rates, and was able to achieve this
while simultaneously pushing up its ADR. Despite the twin threat of terrorism and the ebola virus,
their confinement to distinct and small areas within the region has seemingly offered enough peace
of mind for those wishing to make the trip. southern Africa saw occupancy and ADR fall, with a
corresponding fall in RevPAR of 2.8%. north Africa, on the other hand, was a strong performer with
a rebound in Egypt helping to push regional occupancy rate growth into double-digit territory
(11.5%). ADR grew by 4.2% and RevPAR by 16.2%.
European Tourism in 2014: Trends & Prospects (Q4/2014) 7
© European Travel Commission February 2015
Southern Europe also enjoyed strong growth across all three measures with Greece, Portugal, and
Spain driving this growth. Each enjoyed 22.2%, 9.6%, and 10.4% growth in RevPAR respectively,
in euro terms. The future of southern Europe is somewhat more uncertain than for the other
European sub-regions, with elections in 2015 in Greece, Portugal and Spain. Recent strong hotel
performance in Greece has been driven by demand in Athens, indicating a recovering business
environment; occupancy rates in Athens grew by 19.6% and RevPAR by 29.3% according to data
to December. However, political changes in Greece following January’s election may ultimately
result in exit from the Eurozone, an idea which has been publicly discussed by the new Greek
leadership. This would present some clear short-run barriers to business. But with a new weaker
national currency, demand in the economy could be stimulated more effectively over the medium to
long run.
-10
-5
0
5
10
15
20
Esto
nia
Turk
ey
Denm
ark
Malta
Port
ugal
Lithuania
Cze
ch R
ep
ub
lic
Ru
ssia
Irela
nd
Hu
ng
ary
United
Kin
gd
om
Spa
in
Gre
ece
Neth
erl
and
s
Belg
ium
Sw
itzerla
nd
Italy
Pola
nd
Germ
any
Austr
ia
Rom
an
ia
Fin
lan
d
Fra
nce
Slo
vakia
Hotel average daily rate (ADR)Jan-May year to date, local currency, % change year ago
Source : STR Global
Asia/Pacific Americas Europe MiddleEast/Africa
-4
-2
0
2
4
6
8
10 Occ ADR* RevPAR*
Global Hotel Performance, Jan-Dec 2014
% change year ago
Source: STR Global * ADR and RevPAR denominated in US$ except for Europe
8 European Tourism in 2014: Trends & Prospects (Q4/2014)
© European Travel Commission, February 2015
Key Source Market Performance
The sun shines on European travel all year round…
European travel demand maintains momentum to finish 2014 strongly
Falling oil prices have a varied effect across the continent
Travel to and from Russia impacted by the conflict with Ukraine, as well as
by the tumbling rouble
Robust travel growth from long-haul markets, notably the US, maintains
pace
Key intra-European markets
Latvia has seen huge growth in visits and visitor nights from Germany so far this year, enjoying
36.9% and 38.9% growth respectively, based on data to September. And as Latvia’s second
largest source market after Russia, this growth translates to large numbers in absolute terms.
Iceland has also enjoyed strong arrivals growth from Germany; 13.3% based on full year data.
As with Latvia, given Germany is Iceland’s largest source market, this growth is significant in
absolute terms. As relatively small tourism destinations these are not indicative of the growth in
German travel demand. Despite their large share of arrivals from Germany, these two
destinations combined account for less than 0.5% of German travel within Europe.
In more well-established European destinations, such as Spain and the UK, visitor growth in the
region of 10% is substantial as it translates to relatively large numbers in absolute terms. In
addition, Spain saw visitor nights from Germany grow at an even greater rate.
Some countries have seen visits from Germany fall; Cyrus and Slovakia have suffered the
greatest drop, both in excess of 10%. Switzerland has also experienced a decline, and the
recent decision to unpeg the Swiss franc from the euro will likely exacerbate this trend. Upon
this announcement markets reacted by buying up francs in anticipation of the unpegging giving
a stronger currency. With further appreciates against the euro, visits from European source
markets within the currency union would, in all likelihood, fall further.
Trends discussed in this section relate to the first nine months of the year, although actual coverage
varies by destination; for the majority of countries October or November will be the latest available
data point.
Further detailed monthly data for origin and destination, including absolute values, can be obtained
from TourMIS, http://tourmis.info.
-20
-15
-10
-5
0
5
10
15
20
Latv
iaL
ith
ua
nia
Cze
ch R
ep
Icela
nd
Esto
nia
Se
rbia
Bu
lgaria
Spain
Po
land
UK
Slo
ve
nia
Be
lgiu
mC
roatia
Ro
ma
nia
Tu
rke
yH
un
ga
ryM
onte
ne
gro
Au
str
iaG
ree
ce
Sw
itzerland
Ma
lta
Italy
Slo
va
kia
Cyp
rus
Visits from Germany to select destinations2014, year-to-date*, % change year ago
Source: TourMIS *date varies (Jan-Sep) by destination
43.6
-20
-15
-10
-5
0
5
10
15
20
Latv
iaS
pa
inE
sto
nia
Ne
the
rla
nds
De
nm
ark
Sw
ed
en
Cze
ch R
ep
Se
rbia
No
rwa
yP
ort
ug
al
Lith
ua
nia
Be
lgiu
mP
ola
nd
Luxe
mb
ourg
Cro
atia
Italy
Slo
ve
nia
Fin
lan
dH
ungary
Austr
iaS
witzerland
Ma
lta
Slo
va
kia
German visitor nights in select destinations2014, year-to-date*, % change year ago
Source: TourMIS *date varies (Jan-Dec) by destination
38.9
-20
-15
-10
-5
0
5
10
15
20
Latv
iaIc
ela
nd
Cze
ch R
ep
Lith
ua
nia
Sp
ain
Esto
nia
Bu
lgaria
UK
Se
rbia
Gre
ece
Po
land
Be
lgiu
mT
urk
ey
Ro
ma
nia
Cro
atia
Slo
ve
nia
Hu
ng
ary
Au
str
iaIt
aly
Sw
itzerland
Ma
lta
Mo
nte
ne
gro
Slo
va
kia
Cyp
rus
Visits from Germany to select destinations2014, year-to-date*, % change year ago
Source: TourMIS *date varies (Jan-Dec) by destination
36.9
European Tourism in 2014: Trends & Prospects (Q4/2014) 9
© European Travel Commission February 2015
As a source market, Netherlands has been somewhat of a mixed bag in 2014. In many
ways the preferences of the Dutch align with those of the Germans with the top three
destinations in terms of visits, and the top two in terms of visitor nights the same.
Switzerland has seen visits and visitor nights from Netherlands fall according to data to
November compared to the same period in 2013. Its decision to unpeg the franc is
unlikely to reverse this trend, particularly in the case of Netherlands which has not
recovered as well as some of the other, larger Eurozone economies following the 2008-
09 recession. As such, it is not surprising to note that very few destinations enjoy visitor
nights growth in excess of visits growth, suggesting that the average length of stay by
Dutch tourists is falling.
Once again, Latvia and Iceland feature as top destination markets for France based on
YTD growth, however, both are trumped by Greece which saw visits from France grow by
26.9% based on data to September. This growth may be further supplemented if Greece
was to leave the Eurozone as per speculation. In such a situation, with greater control
over its own currency, Greece could opt to make its exports more attractive by driving
down their relative price via exchange rate mechanisms; tourism would be one such
export.
Portugal and Spain benefit as southerly neighbours of France, with the former seeing
French visitor nights grow by 17.1% based on data to November. Spain enjoyed strong
growth in both visits and nights by 10.9% and 7.3% respectively according to data to
September.
10 European Tourism in 2014: Trends & Prospects (Q4/2014)
© European Travel Commission, February 2015
Central and eastern European destinations dominate the top spots for growth from many
of Europe’s larger source markets, including Italy. Improving air links between these
countries and western Europe are helping to support this longer run trend, in particular
those links delivered by low-cost carriers, while such destinations remain relatively less
expensive than other European destinations and many European travellers remain cost
conscious.
Spain, Greece, and the United Kingdom still maintain their appeal, with Spain enjoying
13% growth in visits from Italy, and Greece and the UK both enjoying 11% growth. Last
quarter’s report saw the UK lead both Spain and Greece in terms of growth, however,
with the inclusion of data for the winter months, it is clear that the UK loses some of its
appeal in the colder weather.
Latvia and Iceland once again reign supreme as destinations for UK travel, as for other
source markets, each enjoying 43% and 31.7% visits growth respectively. But notably strong
growth was also recorded in many of Britain’s more traditional destination markets such as
Greece, Italy, Ireland, Spain, and Portugal (these markets collectively received more than
40% of all UK outbound to Europe and more than 30% of total UK outbound in 2013).
Moreover, British visitor nights also grew; Spain saw growth of 15.6%, Italy 13.8%, and
Portugal 10.2%. In these three countries, the fact that overnights growth is outpacing
arrivals growth suggests a growing appetite and affordability amongst the British tourist to
holiday for longer. And given that Spain alone accounts for 27% of all UK outbound travel to
Europe, such growth from Britain is particularly noteworthy. This strong performance is
consistent with the current pickup in the British economy as well as with movements in the
value of pound. Looking ahead, extremely low levels of inflation in the UK due to falling oil
prices may have the same impact on disposable income as a tax cut, gifting British citizens
with additional disposable income which they would not have had otherwise and which can
be spent on holidays abroad.
European Tourism in 2014: Trends & Prospects (Q4/2014) 11
© European Travel Commission February 2015
Unsurprisingly, the majority of reporting destinations have recorded falling arrivals and
overnights from Russia. These declines reflect falling oil prices and the impact this has
had on Russian aggregate income. This uncertainty has caused the rouble to depreciate
markedly in recent months, making foreign travel relatively more expensive for the
Russian traveller,
The UK continues to see strong growth from Russia, despite its weaker currency.
However, growth has slowed compared to earlier YTD estimates, now 17% based on
data to November. But much of this growth is apparently education related according to
detailed data for the year to September published by Visit Britain. With education-related
travel growth stripped out of this figure, growth from Russia is much more modest.
As the powerhouse of the EU, it is not unexpected to see Germany posting falling arrivals
and overnight visits from Russia. Given this status, the bulk of bad sentiment surrounding
the EU’s sanctions was likely to fall heavily on Germany. It seems also that Romania has
suffered at the hands of the Russia-Ukraine crisis with overnight visits from Russia falling
by 11.8% based on data to August, Russia’s likely favouring Ukraine/Crimea’s Black Sea
coast to Romania’s, perhaps as an act of nationalism.
Serbia has seen close to 20% growth in visits from Russia, and close to 30% growth in
visitor nights, likely benefitting from its pro-Russia stance whilst much of the EU were
imposing sanctions related to its actions in Ukraine. Italy has also seen some strong
growth in visits and visitor nights, of 8.5% and 6.9% respectively. Italy was also
somewhat more pro-Russia than many other EU states.
12 European Tourism in 2014: Trends & Prospects (Q4/2014)
© European Travel Commission, February 2015
Non-European markets Latest data indicate that travel to Europe from the US was positive in most reporting
destinations. Economic growth in the US is strengthening according to the latest data and
we estimate acceleration in GDP in 2014 as a whole. This will include an upswing in
consumer spending on the back of jobs and wage growth. There remains scope for
further growth in outbound travel over the remainder of the year and particularly in terms
of long haul travel, helped by further appreciation in the dollar against key currencies
such as the euro. US outbound travel volume is expected to regain, and even exceed,
previous peak levels achieved in 2007. This is also true for long-haul travel demand.
Norway and Lithuania have enjoyed particularly strong growth from the US in terms of
nights, each growing by 34% and 23.8%, based on data to October and September,
respectively. Greece and Iceland enjoyed strong growth in US visits. It is unusual to see
falling arrivals to Spain. However, since the US is not a particularly large source market
for Spain, this will have only a minimal impact on Spain’s overall performance.
Visits and overnights from Japan suggest that the export-led policies of the Bank of Japan
have not affected travel behaviour as much as initially feared, despite lower spending power
in international markets from the weaker yen. Many European countries continue to report
growth in arrivals, although a majority report lower arrivals and a large minority report lower
overnights.
Strong growth in Greece, Montenegro, and Estonia would however suggest that those
relatively cheaper destinations within Europe have stood to gain from the weaker yen, while
growth in the more traditional European destinations such as Spain and Italy is also evident.
European Tourism in 2014: Trends & Prospects (Q4/2014) 13
© European Travel Commission February 2015
Outbound travel from China has been strong so far in 2014 both in terms of visitor arrivals
and nights, the vast majority in double digit territory. We should expect to see a
continuation of growth in outbound travel, and ahead of general GDP growth. This comes
despite ongoing signs of slowdown in the economy and industrial activity, although
consumer surveys and retail sales data remain robust. Travel to Europe as a whole is
estimated to have grown by over 15% in 2014 as a whole for the fifth consecutive year;
arrivals will be more than 2.5 time larger than in 2009. The Chinese economy remains
stable and with an increasing number of middle-class households, now more consumers
are able to afford travel. However, given the relatively small volumes, travel from China to
Europe should not be overvalued, accounting for just 1.3% of European arrivals in 2013.
Arrivals growth from India is positive with the majority of European destinations reporting
double digit figures. In particular, Bulgaria saw arrivals grow by 59.5%, while Croatia saw
arrivals rise by 47.7% YTD to December with similar 42.7% growth in overnights.
Indian arrivals still represent a relatively small proportion of total European arrivals and
some volatility should be expected, but with limited impact on overall destination
performance. In the longer-term, growth prospects remain strong with potential economic
reform. Given the positive economic trends, there is potential for India to catch-up with
China as an emerging source market.
-30
-20
-10
0
10
20
30
40
50
Bulg
aria
Cro
atia
Latv
ia
Hungary
Pola
nd
Czech R
ep
Belg
ium
Turk
ey
Spain
UK
Italy
Sw
itzerland
Germ
any
Austr
ia
Slo
vakia
Visits from India to select destinations2014, year-to-date*, % change year ago
Source: TourMIS *date varies (Jan-Dec) by destination
59.5
-30
-20
-10
0
10
20
30
40
50
Cro
atia
Po
land
Be
lgiu
m
Hu
ng
ary
Sw
ed
en
Latv
ia
Fin
lan
d
Cze
ch R
ep
Italy
Ne
the
rla
nds
Germ
an
y
Sw
itze
rla
nd
Au
str
ia
De
nm
ark
Slo
va
kia
Sp
ain
Indian visitor nights in select destinations2014, year-to-date*, % change year ago
Source: TourMIS *date varies (Jan-Dec) by destination
14 European Tourism in 2014: Trends & Prospects (Q4/2014)
© European Travel Commission, February 2015
Some strong growth remains from Canada following on from high growth figures reported
earlier in the year. Lithuania features as the strongest performer yet again with 67.2% growth
in visitor nights but the volumes from Canada are likely to be very small. Iceland has also
held up well, managing to sustain strong growth in visits since the beginning of the year,
61.8% based on data to December.
European Tourism in 2014: Trends & Prospects (Q4/2014) 15
© European Travel Commission February 2015
Origin Market Share Analysis
United States
Based on the Tourism Decision Metrics (TDM) model, the following charts and analysis show
Europe’s evolving market position – in absolute and percentage terms – for selected source
markets. 2014 values are year-to-date estimates based on the latest available data and are not
final reported numbers.
Methodology note:
Data in these charts and tables relate to reported arrivals
in all destinations as a comparable measure of outbound
travel for calculation of market share.
Hence, US outbound shown here is larger than reported
departures in national statistics as long-haul trips often
involve travel to multiple destinations. For example, in
2013 US data reporting shows 11.4m departures to
Europe while the sum of European arrivals from the US
was 22m; each US trip to Europe involved a visit to two
destinations on average.
Note: this analysis is based on the Tourism Decision Metrics
(TDM) model. The geographies of Europe are defined as:
Northern Europe: Denmark, Finland, Iceland, Ireland,
Norway, Sweden, UK
Western Europe: Austria, Belgium, France, Germany,
Luxembourg, Netherlands, Switzerland
Southern/Mediterranean Europe: Albania, Bosnia-
Herzegovina, Croatia, Cyprus, FYR Macedonia, Greece, Italy,
Malta, Montenegro, Portugal, Serbia, Slovenia, Spain, Turkey
Central/Eastern Europe: Armenia, Azerbaijan, Bulgaria,
Czech Republic, Estonia, Hungary, Kazakhstan, Kyrgyzstan,
Latvia, Lithuania, Poland, Romania, Russian Federation,
Slovakia, Ukraine
0
10
20
30
40
50
60
2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
US long haul* outbound travel Rest of Long Haul
Central/Eastern Europe
Southern Europe
Western Europe
Northern Europe
Million
*Long haul defined as tourist arrivals to destinations outside North America
Source: Tourism Economics
0%
2%
4%
6%
8%
10%
12%
14%
16%
18%
20%
20
04
20
05
20
06
20
07
20
08
20
09
20
10
2011
20
12
20
13
20
14
20
15
20
16
20
17
20
18
20
19
Europe's share of US marketNorthern Europe
Western Europe
Southern Europe
Central/Eastern Europe
% of long haul* market
*Long haul defined as tourist arrivals to destinations outside North America
Source: Tourism Economics
Level* ShareAnnual
average
Cumulative
growth**
Share
2019
Cumulative
growth**
Share
2009
Total outbound travel (000s) 89,539 - 5.6% 31.5% - 21.0% -
of which:
Long haul (000s) 55,011 61.4% 6.3% 36.0% 63.6% 24.9% 59.5%
Short haul (000s) 34,529 38.6% 4.4% 24.2% 36.4% 15.4% 40.5%
Travel to Europe***
Europe (000s) 23,447 26.2% 5.3% 29.6% 25.8% 24.3% 25.5%
Northern Europe (000s) 5,375 6.0% 6.9% 39.7% 6.4% 15.9% 6.3%
Western Europe (000s) 8,956 10.0% 4.0% 21.6% 9.3% 26.1% 9.6%
Southern Europe (000s) 5,997 6.7% 5.0% 27.8% 6.5% 24.7% 6.5%
Central/Eastern Europe (000s) 3,119 3.5% 6.7% 38.6% 3.7% 35.3% 3.1%
US Market Share Summary
2014 Growth (2014-19) Growth (2009-14)
* Levels are in 000s unless otherwise specified
*** Shares are expressed as a % of total outbound travel
** Shows cumulative change over the relevant time period indicated
16 European Tourism in 2014: Trends & Prospects (Q4/2014)
© European Travel Commission, February 2015
Canada
Note: this analysis is based on the Tourism Decision Metrics
(TDM) model. The geographies of Europe are defined as:
Northern Europe: Denmark, Finland, Iceland, Ireland,
Norway, Sweden, UK
Western Europe: Austria, Belgium, France, Germany,
Luxembourg, Netherlands, Switzerland
Southern/Mediterranean Europe: Albania, Bosnia-
Herzegovina, Croatia, Cyprus, FYR Macedonia, Greece, Italy,
Malta, Montenegro, Portugal, Serbia, Slovenia, Spain, Turkey
Central/Eastern Europe: Armenia, Azerbaijan, Bulgaria,
Czech Republic, Estonia, Hungary, Kazakhstan, Kyrgyzstan,
Latvia, Lithuania, Poland, Romania, Russian Federation,
Slovakia, Ukraine
0
2
4
6
8
10
12
2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
Canada long haul* outbound travel Rest of Long Haul
Central/Eastern Europe
Southern Europe
Western Europe
Northern Europe
Million
*Long haul defined as tourist arrivals to destinations outside North America
Source: Tourism Economics
0%
2%
4%
6%
8%
10%
12%
14%
16%
18%
20%
200
4
2005
200
6
200
7
200
8
200
9
201
0
201
1
201
2
201
3
2014
201
5
201
6
201
7
201
8
201
9
Europe's share of Canadian market Northern Europe
Western Europe
Southern Europe
Central/Eastern Europe
% of long haul* market
*Long haul defined as tourist arrivals to destinations outside North America
Source: Tourism Economics
Level* ShareAnnual
average
Cumulative
growth**
Share
2019
Cumulative
growth**
Share
2009
Total outbound travel (000s) 36,827 - 4.3% 23.7% - 30.2% -
of which:
Long haul (000s) 11,340 30.8% 5.3% 29.2% 32.2% 17.0% 34.3%
Short haul (000s) 25,487 69.2% 3.9% 21.2% 67.8% 37.1% 65.7%
Travel to Europe***
Europe (000s) 4,267 11.6% 3.0% 15.8% 10.9% 14.8% 13.1%
Northern Europe (000s) 874 2.4% 7.3% 42.6% 2.7% -2.0% 3.2%
Western Europe (000s) 1,629 4.4% 0.9% 4.7% 3.7% 14.3% 5.0%
Southern Europe (000s) 1,564 4.2% 2.0% 10.3% 3.8% 32.7% 4.2%
Central/Eastern Europe (000s) 201 0.5% 5.8% 32.7% 0.6% -10.1% 0.8%
* Levels are in 000s unless otherwise specified
** Shows cumulative change over the relevant time period indicated
Canada Market Share Summary
2014 Growth (2014-19) Growth (2009-14)
*** Shares are expressed as a % of total outbound travel
European Tourism in 2014: Trends & Prospects (Q4/2014) 17
© European Travel Commission February 2015
Mexico
Note: this analysis is based on the Tourism Decision Metrics
(TDM) model. The geographies of Europe are defined as:
Northern Europe: Denmark, Finland, Iceland, Ireland,
Norway, Sweden, UK
Western Europe: Austria, Belgium, France, Germany,
Luxembourg, Netherlands, Switzerland
Southern/Mediterranean Europe: Albania, Bosnia-
Herzegovina, Croatia, Cyprus, FYR Macedonia, Greece, Italy,
Malta, Montenegro, Portugal, Serbia, Slovenia, Spain, Turkey
Central/Eastern Europe: Armenia, Azerbaijan, Bulgaria,
Czech Republic, Estonia, Hungary, Kazakhstan, Kyrgyzstan,
Latvia, Lithuania, Poland, Romania, Russian Federation,
Slovakia, Ukraine
0.0
0.5
1.0
1.5
2.0
2.5
2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
Mexico long haul* outbound travel Rest of Long Haul
Central/Eastern Europe
Southern Europe
Western Europe
Northern Europe
Million
*Long haul defined as tourist arrivals to destinations outside North America
Source: Tourism Economics
0%
5%
10%
15%
20%
25%
30%
35%
200
4
200
5
200
6
200
7
200
8
200
9
201
0
2011
201
2
2013
201
4
201
5
201
6
201
7
201
8
201
9
Europe's share of Mexican marketNorthern Europe
Western Europe
Southern Europe
Central/Eastern Europe
% of long haul* market
*Long haul defined as tourist arrivals to destinations outside North America
Source: Tourism Economics
Level* ShareAnnual
average
Cumulative
growth**
Share
2019
Cumulative
growth**
Share
2009
Total outbound travel (000s) 17,845 - 5.2% 28.7% - 18.6% -
of which:
Long haul (000s) 2,355 13.2% 5.4% 29.8% 13.3% 42.8% 11.0%
Short haul (000s) 15,491 86.8% 5.2% 28.6% 86.7% 15.6% 89.0%
Travel to Europe***
Europe (000s) 1,248 7.0% 3.0% 15.9% 6.3% 38.6% 6.0%
Northern Europe (000s) 120 0.7% 5.7% 32.0% 0.7% 43.5% 0.6%
Western Europe (000s) 578 3.2% 3.1% 16.7% 2.9% 33.5% 2.9%
Southern Europe (000s) 437 2.4% 1.4% 7.1% 2.0% 35.2% 2.1%
Central/Eastern Europe (000s) 113 0.6% 5.1% 28.0% 0.6% 86.6% 0.4%
* Levels are in 000s unless otherwise specified
Mexico Market Share Summary
2014 Growth (2014-19) Growth (2009-14)
*** Shares are expressed as a % of total outbound travel
** Shows cumulative change over the relevant time period indicated
18 European Tourism in 2014: Trends & Prospects (Q4/2014)
© European Travel Commission, February 2015
Argentina
Note: this analysis is based on the Tourism Decision Metrics
(TDM) model. The geographies of Europe are defined as:
Northern Europe: Denmark, Finland, Iceland, Ireland,
Norway, Sweden, UK
Western Europe: Austria, Belgium, France, Germany,
Luxembourg, Netherlands, Switzerland
Southern/Mediterranean Europe: Albania, Bosnia-
Herzegovina, Croatia, Cyprus, FYR Macedonia, Greece, Italy,
Malta, Montenegro, Portugal, Serbia, Slovenia, Spain, Turkey
Central/Eastern Europe: Armenia, Azerbaijan, Bulgaria,
Czech Republic, Estonia, Hungary, Kazakhstan, Kyrgyzstan,
Latvia, Lithuania, Poland, Romania, Russian Federation,
Slovakia, Ukraine
0.0
0.5
1.0
1.5
2.0
2.5
2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
Argentina long haul* outbound travel Rest of Long Haul
Central/Eastern Europe
Southern Europe
Western Europe
Northern Europe
Million
*Long haul defined as tourist arrivals to destinations outside South America
Source: Tourism Economics
0%
5%
10%
15%
20%
25%
30%
35%
40%
45%
200
4
200
5
200
6
200
7
200
8
200
9
201
0
2011
201
2
2013
201
4
201
5
201
6
201
7
201
8
201
9
Europe's share of Argentinean market
Northern Europe
Western Europe
Southern Europe
Central/Eastern Europe
% of long haul* market
*Long haul defined as tourist arrivals to destinations outside South America
Source: Tourism Economics
Level* ShareAnnual
average
Cumulative
growth**
Share
2019
Cumulative
growth**
Share
2009
Total outbound travel (000s) 7,783 - 3.0% 16.1% - 46.9% -
of which:
Long haul (000s) 2,288 29.4% 3.0% 15.9% 29.3% 59.9% 27.0%
Short haul (000s) 5,496 70.6% 3.0% 16.2% 70.7% 42.1% 73.0%
Travel to Europe***
Europe (000s) 837 10.8% 2.6% 13.6% 10.5% 44.8% 10.9%
Northern Europe (000s) 114 1.5% 5.0% 27.7% 1.6% 61.7% 1.3%
Western Europe (000s) 47 0.6% 3.6% 19.1% 0.6% 73.7% 0.5%
Southern Europe (000s) 593 7.6% 1.1% 5.6% 6.9% 40.3% 8.0%
Central/Eastern Europe (000s) 84 1.1% 8.1% 47.4% 1.4% 43.6% 1.1%
* Levels are in 000s unless otherwise specified
Argentina Market Share Summary
*** Shares are expressed as a % of total outbound travel
2014 Growth (2014-19) Growth (2009-14)
** Shows cumulative change over the relevant time period indicated
European Tourism in 2014: Trends & Prospects (Q4/2014) 19
© European Travel Commission February 2015
Brazil
Note: this analysis is based on the Tourism Decision Metrics
(TDM) model. The geographies of Europe are defined as:
Northern Europe: Denmark, Finland, Iceland, Ireland,
Norway, Sweden, UK
Western Europe: Austria, Belgium, France, Germany,
Luxembourg, Netherlands, Switzerland
Southern/Mediterranean Europe: Albania, Bosnia-
Herzegovina, Croatia, Cyprus, FYR Macedonia, Greece, Italy,
Malta, Montenegro, Portugal, Serbia, Slovenia, Spain, Turkey
Central/Eastern Europe: Armenia, Azerbaijan, Bulgaria,
Czech Republic, Estonia, Hungary, Kazakhstan, Kyrgyzstan,
Latvia, Lithuania, Poland, Romania, Russian Federation,
Slovakia, Ukraine
0
1
2
3
4
5
6
7
8
2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
Brazil long haul* outbound travel Rest of Long Haul
Central/Eastern Europe
Southern Europe
Western Europe
Northern Europe
Million
*Long haul defined as tourist arrivals to destinations outside South America
Source: Tourism Economics
0%
5%
10%
15%
20%
25%
30%
35%
200
4
200
5
200
6
200
7
200
8
200
9
201
0
2011
201
2
2013
201
4
201
5
201
6
201
7
201
8
201
9
Europe's share of Brazilian marketNorthern Europe
Western Europe
Southern Europe
Central/Eastern Europe
% of long haul* market
*Long haul defined as tourist arrivals to destinations outside South America
Source: Tourism Economics
Level* ShareAnnual
average
Cumulative
growth**
Share
2019
Cumulative
growth**
Share
2009
Total outbound travel (000s) 10,120 - 4.4% 23.9% - 101.0% -
of which:
Long haul (000s) 7,374 72.9% 3.8% 20.6% 70.9% 114.1% 68.4%
Short haul (000s) 2,746 27.1% 5.8% 32.8% 29.1% 72.5% 31.6%
Travel to Europe***
Europe (000s) 3,746 37.0% 0.2% 1.0% 30.2% 97.6% 37.6%
Northern Europe (000s) 257 2.5% 8.8% 52.7% 3.1% 63.2% 3.1%
Western Europe (000s) 1,822 18.0% -0.9% -4.6% 13.9% 114.8% 16.8%
Southern Europe (000s) 1,390 13.7% -1.6% -8.0% 10.2% 87.9% 14.7%
Central/Eastern Europe (000s) 277 2.7% 6.2% 34.9% 3.0% 84.3% 3.0%
* Levels are in 000s unless otherwise specified
Brazil Market Share Summary
** Shows cumulative change over the relevant time period indicated
*** Shares are expressed as a % of total outbound travel
2014 Growth (2014-19) Growth (2009-14)
20 European Tourism in 2014: Trends & Prospects (Q4/2014)
© European Travel Commission, February 2015
India
Note: this analysis is based on the Tourism Decision Metrics
(TDM) model. The geographies of Europe are defined as:
Northern Europe: Denmark, Finland, Iceland, Ireland,
Norway, Sweden, UK
Western Europe: Austria, Belgium, France, Germany,
Luxembourg, Netherlands, Switzerland
Southern/Mediterranean Europe: Albania, Bosnia-
Herzegovina, Croatia, Cyprus, FYR Macedonia, Greece, Italy,
Malta, Montenegro, Portugal, Serbia, Slovenia, Spain, Turkey
Central/Eastern Europe: Armenia, Azerbaijan, Bulgaria,
Czech Republic, Estonia, Hungary, Kazakhstan, Kyrgyzstan,
Latvia, Lithuania, Poland, Romania, Russian Federation,
Slovakia, Ukraine
0
2
4
6
8
10
12
14
2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
India long haul* outbound travel Rest of Long Haul
Central/Eastern Europe
Southern Europe
Western Europe
Northern Europe
Million
*Long haul defined as tourist arrivals to destinations outside South Asia
Source: Tourism Economics
0%
1%
2%
3%
4%
5%
6%
7%
8%
9%
10%
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
Europe's share of Indian marketNorthern Europe
Western Europe
Southern Europe
Central/Eastern Europe
% of long haul* market
*Long haul defined as tourist arrivals to destinations outside South Asia
Source: Tourism Economics
Level* ShareAnnual
average
Cumulative
growth**
Share
2019
Cumulative
growth**
Share
2009
Total outbound travel (000s) 13,525 - 8.4% 50.0% - 71.8% -
of which:
Long haul (000s) 12,809 94.7% 8.2% 48.4% 93.7% 68.8% 96.4%
Short haul (000s) 716 5.3% 12.2% 78.0% 6.3% 151.9% 3.6%
Travel to Europe***
Europe (000s) 1,921 14.2% 7.3% 42.3% 13.5% 49.9% 16.3%
Northern Europe (000s) 400 3.0% 3.2% 16.9% 2.3% 36.8% 3.7%
Western Europe (000s) 705 5.2% 7.1% 40.9% 4.9% 61.7% 5.5%
Southern Europe (000s) 320 2.4% 8.9% 52.9% 2.4% 66.5% 2.4%
Central/Eastern Europe (000s) 496 3.7% 9.6% 58.0% 3.9% 37.6% 4.6%
* Levels are in 000s unless otherwise specified
India Market Share Summary
2014 Growth (2014-19) Growth (2009-14)
*** Shares are expressed as a % of total outbound travel
** Shows cumulative change over the relevant time period indicated
European Tourism in 2014: Trends & Prospects (Q4/2014) 21
© European Travel Commission February 2015
China
Note: this analysis is based on the Tourism Decision Metrics
(TDM) model. The geographies of Europe are defined as:
Northern Europe: Denmark, Finland, Iceland, Ireland,
Norway, Sweden, UK
Western Europe: Austria, Belgium, France, Germany,
Luxembourg, Netherlands, Switzerland
Southern/Mediterranean Europe: Albania, Bosnia-
Herzegovina, Croatia, Cyprus, FYR Macedonia, Greece, Italy,
Malta, Montenegro, Portugal, Serbia, Slovenia, Spain, Turkey
Central/Eastern Europe: Armenia, Azerbaijan, Bulgaria,
Czech Republic, Estonia, Hungary, Kazakhstan, Kyrgyzstan,
Latvia, Lithuania, Poland, Romania, Russian Federation,
Slovakia, Ukraine
0
5
10
15
20
25
30
2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
China long haul* outbound travel Rest of Long Haul
Central/Eastern Europe
Southern Europe
Western Europe
Northern Europe
Million
*Long haul defined as tourist arrivals to destinations outside Northeast Asia
Source: Tourism Economics
0%
5%
10%
15%
20%
25%
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
Europe's share of Chinese marketNorthern Europe
Western Europe
Southern Europe
Central/Eastern Europe
% of long haul* market
*Long haul defined as tourist arrivals to destinations outside Northeast Asia
Source: Tourism Economics
Level* ShareAnnual
average
Cumulative
growth**
Share
2019
Cumulative
growth**
Share
2009
Total outbound travel (000s) 67,600 - 5.9% 33.5% - 142.5% -
of which:
Long haul (000s) 26,737 39.6% 6.6% 37.4% 40.7% 190.3% 33.0%
Short haul (000s) 40,863 60.4% 5.5% 30.9% 59.3% 118.9% 67.0%
Travel to Europe***
Europe (000s) 8,773 13.0% 6.0% 34.0% 13.0% 161.1% 12.1%
Northern Europe (000s) 467 0.7% 7.6% 44.1% 0.7% 147.0% 0.7%
Western Europe (000s) 4,851 7.2% 6.0% 33.5% 7.2% 214.6% 5.5%
Southern Europe (000s) 669 1.0% 9.9% 60.5% 1.2% 189.8% 0.8%
Central/Eastern Europe (000s) 2,787 4.1% 4.9% 26.9% 3.9% 99.3% 5.0%
China Market Share Summary
2014 Growth (2014-19) Growth (2009-14)
* Levels are in 000s unless otherwise specified
** Shows cumulative change over the relevant time period indicated
*** Shares are expressed as a % of total outbound travel
22 European Tourism in 2014: Trends & Prospects (Q4/2014)
© European Travel Commission, February 2015
Japan
Note: this analysis is based on the Tourism Decision Metrics
(TDM) model. The geographies of Europe are defined as:
Northern Europe: Denmark, Finland, Iceland, Ireland,
Norway, Sweden, UK
Western Europe: Austria, Belgium, France, Germany,
Luxembourg, Netherlands, Switzerland
Southern/Mediterranean Europe: Albania, Bosnia-
Herzegovina, Croatia, Cyprus, FYR Macedonia, Greece, Italy,
Malta, Montenegro, Portugal, Serbia, Slovenia, Spain, Turkey
Central/Eastern Europe: Armenia, Azerbaijan, Bulgaria,
Czech Republic, Estonia, Hungary, Kazakhstan, Kyrgyzstan,
Latvia, Lithuania, Poland, Romania, Russian Federation,
Slovakia, Ukraine
0
2
4
6
8
10
12
14
16
2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
Japan long haul* outbound travel Rest of Long Haul
Central/Eastern Europe
Southern Europe
Western Europe
Northern Europe
Million
*Long haul defined as tourist arrivals to destinations outside Northeast Asia
Source: Tourism Economics
0%
2%
4%
6%
8%
10%
12%
14%
16%
18%
20%
2004
2005
200
6
2007
2008
2009
201
0
2011
2012
2013
201
4
2015
2016
2017
2018
2019
Europe's share of Japanese marketNorthern Europe
Western Europe
Southern Europe
Central/Eastern Europe
% of long haul* market
*Long haul defined as tourist arrivals to destinations outside Northeast Asia
Source: Tourism Economics
Level* ShareAnnual
average
Cumulative
growth**
Share
2019
Cumulative
growth**
Share
2009
Total outbound travel (000s) 22,284 - 3.2% 17.0% - 11.2% -
of which:
Long haul (000s) 13,984 62.8% 2.3% 11.9% 60.0% 22.4% 57.0%
Short haul (000s) 8,300 37.2% 4.7% 25.5% 40.0% -3.7% 43.0%
Travel to Europe***
Europe (000s) 4,474 20.1% 0.5% 2.7% 17.6% 15.0% 19.4%
Northern Europe (000s) 454 2.0% -0.5% -2.5% 1.7% 0.0% 2.3%
Western Europe (000s) 2,203 9.9% -0.3% -1.6% 8.3% 15.4% 9.5%
Southern Europe (000s) 1,251 5.6% 1.3% 6.7% 5.1% 26.9% 4.9%
Central/Eastern Europe (000s) 566 2.5% 2.9% 15.2% 2.5% 4.6% 2.7%
2014 Growth (2014-19) Growth (2009-14)
** Shows cumulative change over the relevant time period indicated
Japan Market Share Summary
* Levels are in 000s unless otherwise specified
*** Shares are expressed as a % of total outbound travel
European Tourism in 2014: Trends & Prospects (Q4/2014) 23
© European Travel Commission February 2015
United Arab Emirates
Note: this analysis is based on the Tourism Decision Metrics
(TDM) model. The geographies of Europe are defined as:
Northern Europe: Denmark, Finland, Iceland, Ireland,
Norway, Sweden, UK
Western Europe: Austria, Belgium, France, Germany,
Luxembourg, Netherlands, Switzerland
Southern/Mediterranean Europe: Albania, Bosnia-
Herzegovina, Croatia, Cyprus, FYR Macedonia, Greece, Italy,
Malta, Montenegro, Portugal, Serbia, Slovenia, Spain, Turkey
Central/Eastern Europe: Armenia, Azerbaijan, Bulgaria,
Czech Republic, Estonia, Hungary, Kazakhstan, Kyrgyzstan,
Latvia, Lithuania, Poland, Romania, Russian Federation,
Slovakia, Ukraine
0.0
0.5
1.0
1.5
2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
UAE long haul* outbound travel Rest of Long Haul
Central/Eastern Europe
Southern Europe
Western Europe
Northern Europe
Million
*Long haul defined as tourist arrivals to destinations outside the Middle East
Source: Tourism Economics
0%
5%
10%
15%
20%
25%
30%
200
4
200
5
200
6
200
7
200
8
200
9
201
0
2011
201
2
2013
201
4
201
5
201
6
201
7
201
8
201
9
Europe's share of Emirati marketNorthern Europe
Western Europe
Southern Europe
Central/Eastern Europe
% of long haul* market
*Long haul defined as tourist arrivals to destinations outside the Middle East
Source: Tourism Economics
Level* ShareAnnual
average
Cumulative
growth**
Share
2019
Cumulative
growth**
Share
2009
Total outbound travel (000s) 2,602 - 5.5% 30.5% - -24.7% -
of which:
Long haul (000s) 1,113 42.8% 5.2% 28.6% 42.2% 1.6% 31.7%
Short haul (000s) 1,489 57.2% 5.7% 31.9% 57.8% -36.9% 68.3%
Travel to Europe***
Europe (000s) 591 22.7% 4.0% 21.9% 21.2% -11.1% 19.2%
Northern Europe (000s) 160 6.2% 1.1% 5.9% 5.0% -35.2% 7.2%
Western Europe (000s) 278 10.7% 3.9% 21.2% 9.9% 20.3% 6.7%
Southern Europe (000s) 137 5.3% 7.0% 40.1% 5.7% 17.9% 3.4%
Central/Eastern Europe (000s) 16 0.6% 6.8% 38.9% 0.7% -77.3% 2.0%
United Arab Emirates Market Share Summary
*** Shares are expressed as a % of total outbound travel
** Shows cumulative change over the relevant time period indicated
2014 Growth (2014-19) Growth (2009-14)
* Levels are in 000s unless otherwise specified
24 European Tourism in 2014: Trends & Prospects (Q4/2014)
© European Travel Commission, February 2015
Russia
The rouble continues to fall against the dollar (and
indeed many other currencies, including the euro) as
oil prices continue to hover just below $50/barrel.
The central bank of Russia now estimates that
capital flight from Russia totalled $150 billion in
2014, double 2013’s level. This underlines the
pressure on both parts of the Russian balance of
payments (current and financial account) from low oil
prices, sanctions and financial instability.
Note: this analysis is based on the Tourism Decision Metrics
(TDM) model. The geographies of Europe are defined as:
Northern Europe: Denmark, Finland, Iceland, Ireland,
Norway, Sweden, UK
Western Europe: Austria, Belgium, France, Germany,
Luxembourg, Netherlands, Switzerland
Southern/Mediterranean Europe: Albania, Bosnia-
Herzegovina, Croatia, Cyprus, FYR Macedonia, Greece, Italy,
Malta, Montenegro, Portugal, Serbia, Slovenia, Spain, Turkey
Central/Eastern Europe: Armenia, Azerbaijan, Bulgaria,
Czech Republic, Estonia, Hungary, Kazakhstan, Kyrgyzstan,
Latvia, Lithuania, Poland, Romania, Russian Federation,
Slovakia, Ukraine
0
5
10
15
20
25
30
35
40
45
2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
Russia outbound travel Rest of World
Central/Eastern Europe
Southern Europe
Western Europe
Northern Europe
Million
*Outbound travel defined as tourist arrivals to all destinations
Source: Tourism Economics
0%
10%
20%
30%
40%
50%
60%
70%
200
4
200
5
2006
200
7
200
8
200
9
2010
201
1
201
2
201
3
2014
201
5
201
6
201
7
201
8
201
9
Europe's share of Russian marketNorthern Europe
Western Europe
Southern Europe
Central/Eastern Europe
% of outbound* market
*Outbound market defined as tourist arrivals to all destinations
Source: Tourism Economics
Level* ShareAnnual
average
Cumulative
growth**
Share
2019
Cumulative
growth**
Share
2009
Total outbound travel (000s) 40,234 - 2.2% 11.6% - 92.4% -
of which:
Long haul (000s) 9,055 22.5% 6.4% 36.1% 27.5% 101.7% 21.5%
Short haul (000s) 31,179 77.5% 0.9% 4.5% 72.5% 89.9% 78.5%
Travel to Europe***
Europe (000s) 31,179 77.5% 0.9% 4.5% 72.5% 89.9% 78.5%
Northern Europe (000s) 1,673 4.2% 1.3% 6.5% 4.0% 68.6% 4.7%
Western Europe (000s) 2,424 6.0% 0.2% 1.1% 5.5% 129.1% 5.1%
Southern Europe (000s) 10,111 25.1% 1.9% 9.7% 24.7% 135.3% 20.6%
Central/Eastern Europe (000s) 16,972 42.2% 0.3% 1.6% 38.4% 68.5% 48.2%
* Levels are in 000s unless otherwise specified
Russia Market Share Summary
*** Shares are expressed as a % of total outbound travel
2014 Growth (2014-19) Growth (2009-14)
** Shows cumulative change over the relevant time period indicated
European Tourism in 2014: Trends & Prospects (Q4/2014) 25
© European Travel Commission February 2015
Economic outlook summary: key source markets
Eurozone GDP growth is forecast to grow in 2015 across all key markets with the exception of
Russia.
Performance by some key Eurozone economies will remain sluggish, particularly Italy where
deflation is dragging on consumer expenditure.
The UK’s recovery is in full flow with strong growth across all key macro indicators expected to
continue in 2015, particularly GDP and consumer expenditure, up 3.0% and 3.2% on 2014,
respectively. Strength of the latter is based largely on falling oil prices.
Russian growth has slowed substantially in 2015 and Oxford Economics’ latest outlook is for a
deep recession with GDP expected to fall more than 6%. This is partly linked to the large
devaluation of the rouble which began last year (down 28.6% against the euro for 2014 as a
whole) and risks related to capital flight in emerging markets, while a falling oil price will also affect
government revenue and spending. Political tensions, including sanctions will further affect
investment attractiveness.
Chinese growth is also expected to slow marginally in 2014, although it remains the strongest
growing source market in terms of GDP and consumer expenditure, the latter arguably being the
more pertinent to outbound travel and tourism growth. China remains a small source market for
Europe, however strong travel growth from China nonetheless provides a modest contribution to
overall growth.
Strong GDP and consumer expenditure growth in India will pave the way for outbound travel
growth.
Assessing recent tourism data and industry performance is a useful way of directly monitoring the
key trends for travel demand across Europe. This can be complemented by looking at key trends
and relationships in macroeconomic performance in Europe’s key source markets which can
provide further useful insight into likely tourism developments throughout the year.
The linkages between macro and tourism performance can be very informative. For example,
strong GDP or consumer spending growth is an indication of rising prosperity with people more
likely to avail of international travel. It is also an indication of rising business activity and therefore
stronger business travel. Movements in exchange rates against the euro can be equally important
as it can influence choice of destination.
GDP
Consumer
expenditure
Unemploy-
ment **
Exchange
rate*** Inflation GDP
Consumer
expenditure
Unemploy-
ment **
Exchange
rate*** Inflation
UK 2.6% 2.3% -1.1% 5.4% 1.5% UK 3.0% 3.2% -0.6% 2.8% 0.1%
France 0.4% 0.6% -0.1% 0.0% 0.5% France 1.2% 1.5% 0.1% 0.0% 0.3%
Germany 1.5% 1.1% -0.2% 0.0% 0.9% Germany 2.0% 2.3% 0.0% 0.0% 0.4%
Netherlands 0.7% -0.1% 0.2% 0.0% 1.0% Netherlands 1.4% 0.7% -0.4% 0.0% 0.6%
Italy -0.4% 0.3% 0.6% 0.0% 0.2% Italy 0.2% 0.4% 0.1% 0.0% -0.1%
Russia 0.6% 0.5% -0.3% -16.7% 7.8% Russia -6.3% -7.7% 1.2% -28.6% 12.9%
US 2.4% 2.5% -1.2% -0.1% 1.7% US 3.3% 3.2% -0.7% 13.1% 1.1%
Canada 2.5% 2.8% -0.2% -6.8% 1.9% Canada 2.4% 2.6% -0.3% 6.8% 1.2%
Brazil 0.0% 0.8% -0.5% -8.2% 6.3% Brazil 0.1% 0.5% 0.7% -6.5% 6.6%
China 7.4% 7.8% 0.0% -0.3% 2.0% China 6.8% 7.2% 0.0% 11.4% 1.3%
Japan 0.1% -1.1% -0.4% -7.7% 2.8% Japan 0.9% 1.1% -0.1% -3.1% 1.5%
India 5.3% 6.2% 0.0% -4.0% 7.1% India 6.1% 4.9% 0.0% 11.1% 5.5%
* unless otherwise specified
** percentage point change
Note: Colour coding relates to each individual column and highlights the strongest performing countries shaded as dark green (e.g. China fastest growing GDP), and
weakest performaing countries as dark red (e.g. rising unemployment and falling GDP, consumer expenditure, and exchange rate in Russia).
Summary of economic outlook: 2014% growth y-y*
Macroeconomic indicators
Summary of economic outlook: 2015% growth y-y*
Macroeconomic indicators
*** exchange rates measured against the euro. A positive change indicates stronger local currency against the euro and therefore a positive impact on outbound
tourism demand. A negative change indicates weaker local currency against the euro and therefore a negative impact on outbound tourism demand.
26 European Tourism in 2014: Trends & Prospects (Q4/2014)
© European Travel Commission, February 2015
Overview: Oil price slump boosts growth forecasts
Oil prices have fallen further over the past month,
with Brent dropping below $50 per barrel. Prices are
now down over 50% from their June 2014 peak
levels. We do not expect any significant supply
response (either from Saudi Arabia or US shale
producers) to come through until late this year so low
prices will persist for some time.
This is a positive development for world growth,
though the impact will be uneven across countries.
Based on our new oil price forecast of $55/barrel for
2015, we estimate that the oil bill for ten leading
industrial economies, (accounting for over 60% of
world GDP) will be $440 billion lower than it would
have been based on our June 2014 oil forecasts.
This is around 1% of their combined GDP, money
potentially free to be spent on other goods and
services, including those of their main trading
partners.
US consumer sentiment already shows signs of
reacting positively and with other US consumer
fundamentals also improving we have upgraded our
2015 GDP growth forecast to 3.3% from 3% last
month.
We have also upgraded our forecasts for other
advanced economies such as the Eurozone and
Japan, where lower prices should be a respite to
hard-pressed consumers in particular.
For the emerging markets, the slide in oil has starkly
different consequences for different countries. Oil
producers will be losers, most strikingly Russia
where we now see GDP down over 6% this year –
with financial instability exacerbating the oil effect.
But China and India should both gain.
Lower oil prices will also ease the external pressures
some emergers have felt in recent months –
reducing the risk of further hikes in domestic interest
rates resulting from inflation and currency pressures.
We now see world growth at 2.9% in 2015, up a
tenth from last month and an increase from 2.6%
growth last year. This is our first upgrade to the
global growth forecast since August 2014.
European Tourism in 2014: Trends & Prospects (Q4/2014) 27
© European Travel Commission February 2015
28 European Tourism in 2014: Trends & Prospects (Q4/2014)
© European Travel Commission, February 2015
-0.5
0.0
0.5
1.0
1.5
2.0
2.5
3.0
3.5
4.0
1997 2000 2003 2006 2009 2012 2015
% year
Source: Oxford Economics
F'cast
Eurozone: Consumer price inflation
0.8
0.9
1.0
1.1
1.2
1.3
1.4
1.5
1.6
2000 2002 2004 2006 2008 2010 2012 2014 2016
Source: Oxford Economics/ Haver Analytics
Eurozone: $/€ exchange rate
F'cast
$/€
7
8
9
10
11
12
13
1994 1997 2000 2003 2006 2009 2012 2015 2018Source: Oxford Economics
%
F'cast
Eurozone: Unemployment
Eurozone Economy
In light of the tumbling price of oil and (to a lesser
extent) renewed euro weakness we have made
notable revisions to our forecast for the Eurozone
economy in the coming couple of years. Based on
the new outlook for oil prices it seems likely that
annual inflation will be negative for much of 2015,
and giving households a further boost to spending
power. As a result we have increased our forecast for
consumer spending growth in 2015 from 1.4% to
1.6%.
In response to inflation tipping below zero we expect
the ECB to accelerate its asset purchases in 2015,
starting with the meeting later this month. This should
add a little further downward pressure to the euro,
and support exporters in 2015-16. We have therefore
revised up modestly our expectation for the
Eurozone’s current account surplus. Overall we have
increased our forecasts for GDP growth to 1.5% for
2015 (from 1.3%) and 1.8% for 2016 (from 1.7%).
Nevertheless, given the need for fiscal restraint and
private sector deleveraging, and with wage growth
being constrained by the degree of labour market
slack, medium term growth will remain unimpressive
by historical standards. Furthermore with oil prices
likely to rebound in the later years of the decade this
will act as a drag on household income growth. We
expect GDP growth to remain around 1.6-1.7%
during 2017-18.
In addition, a number of major risks persist. Most
worryingly, although core inflation seems to be
holding up in recent data, there remains the
possibility that second round effects from the lower
cost of energy start to erode core price growth in the
coming months, and ultimately detach price
expectations for the longer term. 2015 also has the
potential to reignite Eurozone financial instability, with
a coalition of radical parties newly in power in
Greece, and an equally radical party similarly well
placed ahead of elections in Spain.
European Tourism in 2014: Trends & Prospects (Q4/2014) 29
© European Travel Commission February 2015
-1.5
-1.0
-0.5
0.0
0.5
1.0
1.5
2.0
2.5
Jan-14
Mar-14
May-14
Jul-14
Sep-14
Nov-14
Jan-15
Mar-15
May-15
Jul-15
Sep-15
Nov-15
Other
Energy
Petrol
Food
CPI
UK: Contributions to CPI inflation% year
Source : Oxford Economics
Forecast
-2
-1
0
1
2
3
4
5
6
2002 2004 2006 2008 2010 2012 2014 2016 2018
% year
CPI inflation
Source: Oxford Economics
Average earningsForecast
UK: Earnings & inflation
-20
-15
-10
-5
0
5
10
15
2000 2002 2004 2006 2008 2010 2012 2014 2016 2018
% year
UK: Business investment and GDP
GDP
Businessinvestment
Source: Oxford Economics
Forecast
UK Economy
2014 ended on a slightly downbeat note, with the
ONS revising down its estimates of quarterly GDP
growth for each quarter between Q2 2013 and Q2
2014. This reduced the annual growth rate in Q3
2014 from 3.0% to 2.6%. But while these revisions
were disappointing, they do not alter the fact that
2014 was the UK’s best year since the financial
crisis and past experience suggests that the ONS
will probably revise up its estimate of 2014 growth
to 3% – or perhaps even higher – over the next
few years, once the data has been through the
Blue Book balancing process.
High frequency data suggest that the economy lost
some of its momentum in the latter part of last
year, so the recent plunge in the oil price comes at
a particularly opportune time. Weekly data from
DECC suggests that retail petrol prices have
already fallen by more than 8% over the past
month and prices should fall further as the impact
of the latest declines in the price of crude oil
continue to feed through. Our forecast assumes
that Brent crude oil will average $55 per barrel in
2015 and our modelling suggests that this will
result in the price of unleaded petrol falling to
£1.03 per litre in early 2015, down from £1.31 in
July.
With a lower oil price also set to reduce production
costs across a range of sectors, we expect CPI
inflation to briefly turn negative in early 2015 and to
average just 0.1% across 2015 as a whole. This
will provide a substantial boost to household
purchasing power, giving renewed momentum to
GDP growth.
Lower inflation will also provide the MPC with a
dilemma. Stronger wage growth and further
declines in unemployment would appear to fulfil
the criteria it had set for interest rates to start
rising, while the fall in the oil price is also likely to
cause it to revise up its forecasts for GDP growth.
However, we think it unlikely that the Committee
will want to put up interest rates at a time when
inflation rates are so low. Therefore, with CPI
inflation expected below 1% for almost all of this
year, we now expect the first rate hike to come in
Q1 2016, rather than Q3 2015.
30 European Tourism in 2014: Trends & Prospects (Q4/2014)
© European Travel Commission, February 2015
US Economy
Real GDP growth was revised up to 5% annualised in
Q3, with final sales also rising 5% and inventories
having little impact as the composition of growth also
improved with households and businesses playing a
greater role than in H1.
We estimate that real GDP growth cooled modestly in
Q4, but even so it probably ran at a fairly solid 3%
annualised pace. Importantly, we see stronger
consumer spending growth (at just under 4%)
supported by robust payroll growth, firming wages
and lower gasoline prices.
The labor market remains very strong with
employment gains averaging 246,000 jobs per month
in 2014. In 2015, we see continued strength in
payrolls, though probably at a more subdued monthly
pace of just under 200,000.
Wage growth is slowly picking up though we have yet
to see a marked and broad-based acceleration. This
year, we see ongoing gains in employment and
firmer growth in labor compensation as the key
underpinnings to stronger consumer spending and
housing activity. Real personal consumption should
rise 3.2% in 2015, up from a 2.5% increase in 2014.
Although housing struggled to accelerate in 2014, we
see low interest rates, modest home price increases,
strong employment gains and firmer wage growth
supporting 1.23 million housing starts in 2015.
Most leading investment indicators suggest a solid
outlook. Businesses should continue to thrive on
robust domestic fundamentals though lower oil prices
are likely to curb oil drilling activity.
The US economy will benefit from lower oil prices as
exports respond to firming global growth – albeit its
positive impact will be partly dampened by the
stronger dollar weighing on export competitiveness.
Lower crude oil and gasoline prices will push inflation
as measured by the consumer spending deflator
down to 1% in 2015, but the effects will be transitory.
Moreover, core price pressures are expected to rise
gradually as the economy picks up and we believe
this will prompt the Fed to raise interest rates in June.
We have revised up our forecast for real GDP growth
in 2014 to 2.4% (from 2.3%), and raised our 2015
growth outlook to 3.3% (from 3%), on a stronger
finish to 2014 and the net boost from lower oil prices.
European Tourism in 2014: Trends & Prospects (Q4/2014) 31
© European Travel Commission February 2015
-5.0
-4.0
-3.0
-2.0
-1.0
0.0
1.0
2.0
3.0
Q1 Q2 Q3 Q4 (Est)
Private consumption Fixed investment Net exports Government consumption StockbuildingGDP
Japan: Quarterly GDP contributions, 2014% quarterly contribution
Source : Cabinet Office of Japan / Haver Analytics
-3
-2
-1
0
1
2
3
2006 2007 2008 2009 2010 2011 2012 2013 2014
Source: Ministry of Internal Affairs and Communications / Haver Analytics
Japan: Core inflation (ex-sales tax)
% year
2% target
-3
-2
-1
0
1
2
3
Jan-12 Jul-12 Jan-13 Jul-13 Jan-14 Jul-14
Total gross cash earnings
Source: Ministry of Health, Labour and Welfare / Haver Analytics
Japan: Earnings
% year
Japanese Economy
Incoming data points to modest growth at the end of
last year. PMI readings are consistently registering
above 50 – in December the manufacturing index
stood at 52.0 and the services index at 51.7. In
addition, although industrial production and retail
sales both fell in November, activity is nevertheless
generally on an upward trend – in the three months
to November industrial production was up 1.9% on
the preceding period, while retail sales were up
2.8%. We estimate that Q4 saw GDP growth of
0.6%.
Recent global developments have prompted us to
lower our oil price forecast again – we now see
Brent crude averaging $55/pb this year and staging
a gradual recovery thereafter. The most immediate
impacts on Japan will be on inflation and the current
account. Indeed the impact of lower oil on inflation is
already being felt – core inflation (excluding the
impact of April’s sales tax hike) fell to 0.7% in
November, with lower energy the main drag. The
merchandise trade balance has also rebounded in
recent months on the lower energy import bill.
Our weaker oil forecast will also feed through to
slightly higher GDP growth this year due to the real
income boost for consumers. We now forecast 0.9%
growth in 2015 (up from 0.8% in December). We
expect consumer spending to grow 1.1% this year,
improving to 1.8% growth in 2016.
The government has proposed ¥3.5 trillion of
stimulus spending (0.7% of GDP) in this year’s
supplementary budget, in line with expectations.
This is the smallest supplementary budget for many
years; the overall fiscal stance this year will still be
contractionary given the lasting drag on real
incomes from the sales tax.
Government bond yields have tumbled in the wake
of the Bank of Japan’s latest easing and Q3’s
contraction. Yields are now negative at the short
end of the curve; 10-years have dropped below
0.3%; and at the very long end yields have fallen
almost 60 basis points. Through 2015 this should
start to feed through to more rapid money and credit
growth and thus to stronger aggregate spending.
32 European Tourism in 2014: Trends & Prospects (Q4/2014)
© European Travel Commission, February 2015
-10
-8
-6
-4
-2
0
2
4
6
8
10
-60
-40
-20
0
20
40
60
2008 2009 2010 2011 2012 2013 2014
OE China commodity index and producer prices% year
Source: Oxford Economics/Haver Analytics
% year
Commodity index (lhs)
Producer prices (rhs)
0
2
4
6
8
10
12
14
16
18
1999 2001 2003 2005 2007 2009 2011 2013 2015 2017
% year
Consumer prices
Source: Oxford Economics
Forecast
Brazil: Inflation targeting
Inflation target
Emerging Market Economies
Lower oil improves outlook for China…
Like other oil importers, the Chinese economy stands to
gain substantially from lower oil prices. Real incomes
are boosted, encouraging consumption, and industry
benefits from lower input prices.
Chinese producer prices have been falling for several
years already, however, reflecting overcapacity in some
sectors, so this is not all good news for the economy. In
fact, slowing demand from China is one of the factors
underlying lower oil prices – last year China overtook
the US as the largest net importer of crude oil and other
petroleum products (there are also supply-side factors
influencing the price, including Saudi Arabia’s refusal to
cut output).
We forecast CPI inflation to average just 1.3% this year
and we revised our GDP growth forecast for 2015 and
2016 up to 6.8% and 6.1% (from 6.5% and 5.9%,
respectively, in December).
…India, and most other oil importers
India should be one of the main beneficiaries of lower oil
prices as it is one of the world’s largest oil importers.
CPI Inflation is now expected to average 5.5% this year
(down from 6% last month). Consumer spending will
benefit; indeed strong consumer goods orders in the
December PMI indicate this is already coming through.
Investment should pick up and may get a further boost if
the Reserve Bank brings forward its expected interest
rate easing (we currently forecast a 25bp rate cut in Q1
and a further reduction later in the year). We have
upgraded our GDP forecast for 2015 to 6.1%, from
5.7% last month.
Most other Asian emerging economies will also see
lower inflation, higher real household incomes and
improved corporate profitability supporting growth this
year. With this in mind we have raised our forecasts for
2015 and 2016 in South Korea, Philippines, Thailand
and Taiwan as well as Turkey and several eastern
European economies.
Brazil is a major exception
Brazil will not benefit from the fall in oil prices, as
Petrobras – the state-owned giant that sets fuel prices –
will use the opportunity to improve its profitability rather
than cutting prices at the pump. We forecast that
inflation will rise slightly to 6.6% this year from 6.3% in
-100
-80
-60
-40
-20
0
20
40
60In
do
ne
sia
Russia
Sth
Afr
ica
Ma
laysia
Bra
zil
Chin
a
India
Phili
pp
ines
Net energy imports as % of EM energy use
% of energy use, 2011
Source : World Bank Development Indicators
European Tourism in 2014: Trends & Prospects (Q4/2014) 33
© European Travel Commission February 2015
2015. GDP will grow just 0.1% (down from 0.7% in
December) as fiscal consolidation and tighter monetary
policy take hold.
Saudi revenues plummet, hitting budget
The impact of lower oil prices on Saudi government
revenues will be substantial as oil revenues typically
account for some 90% of the total. Oil production and
exports are not expanding, despite substantial spare
capacity and the fact that the authorities have eschewed
their traditional role as OPEC’s swing producer, preferring
to maintain their oil market share.
We expect the government to maintain spending at
elevated levels to support the economy, a strategy it can
afford given the negligible debt burden and substantial net
foreign assets. But GDP will still slip to just 2% this year, a
marked cut in our forecast from the 2.9% expected in
December.
Russia’s economy deteriorates further
Russia is entering a severe recession. Oil prices have
continued to slide in the past month. Our $55/barrel price
forecast this year will be a major terms-of-trade shock for
Russia as exports of fuel account for more than 60% of
total exports. The oil price drop will also weaken the fiscal
position and force the government to tap its reserve fund.
Although the central bank hiked its policy interest rate
sharply to 17% in December, the rouble is still
depreciating. It is currently around 47% lower than in June
last year, and there is a risk that formal capital controls
will be introduced if the exchange rate remains under
pressure. Tight monetary policy will be a major drag on
domestic demand this year.
Ongoing sanctions complete the gloomy outlook for
Russia. In December we forecast that the economy would
shrink by 3.6% in 2015, with the risk that the contraction
could be much more pronounced. Bur given the most
recent developments, we now think the contraction will
exceed 6%.
Venezuela faces growing instability
As one of the higher cost producers of oil, Venezuela
faces high and rising sovereign default risks. We expect
GDP will fall by 4.5% this year, after a likely 3.5%
contraction in 2014. The government has no choice but to
reduce demand and cut imports further. Inflation is
expected to peak at around 75% in Q1 2015. The deep
recession and very high inflation could trigger political and
social instability.
0
500
1000
1500
2000
2500
3000
3500
Jan 11 Jan 12 Jan 13 Jan 14 Jan 15
Spread, bps over US Treasuries
Source: JP Morgan / Haver Analytics
Venezuela and Argentina: Risk spread
Argentina
Venezuela
-15
-10
-5
0
5
10
15
2006 2008 2010 2012 2014 2016 2018
GDP Industrial production
Russia: GDP and industrial production% year
Source: Oxford Economics
Forecast
-40
-30
-20
-10
0
10
20
30
40
50
60
70
-100
-75
-50
-25
0
25
50
75
100
125
150
175
1992 1995 1998 2001 2004 2007 2010 2013 2016
US$ bn(LHS)
F'cast
% of GDP
Source: Oxford Economics
% of GDP(RHS)
Saudi Arabia: Government budget balance
US$ bn
34 European Tourism in 2014: Trends & Prospects (Q4/2014)
© European Travel Commission, February 2015
Glossary of commonly used terms and abbreviations
Airline industry indicators
ASK Available Seat Kilometers. Indicator of airline supply, available seats x kilometers flown
PLF Passenger Load Factor. Indicator of airline capacity. Equal to revenue passenger kilometers
(RPK) / available seat kilometers (ASK)
RPK Revenue Passenger Kilometers. Indicator of airline demand, paying passenger x kilometers
flown
Hotel industry indicators
ADR Average Daily Rate. Indicator of hotel room pricing. Equal to hotel room revenue / rooms sold in a
given period.
Occ Occupancy Rate. Indicator of hotel performance. Equal to the number of hotel rooms sold /
room supply.
RevPAR Revenue per Available Room. Indicator of hotel performance. Equal to hotel room revenue /
rooms available in a given period
Central Banks
BoE Bank of England; MPC Monetary Policy Committee of BoE
BoJ Bank of Japan
ECB European Central Bank
Fed Federal Reserve (US)
RBI Reserve Bank of India
Economic indicators and terms
Broad money: key indicator of money supply and liquidity including currency holdings as well as bank
deposits that can easily be converted to cash
CPI Consumer Price Index. Measure of price inflation for consumer goods
GDP Gross Domestic Product. The value of goods and services produced in a given economy
LCU Local Currency Unit. The national unit of currency of a given country, e.g. pound, euro, etc.
PMI Purchasing Managers’ Index. Indicator of producers’ sentiment and the direction of the economy
PPI Purchase Price Index. Measure of inflation of input prices to producers of goods and services
PPP Purchasing Power Parity. An implicit exchange rate which equalises the price of identical goods
and services in different countries so they can be expressed with a common price.
QE Quantitive Easing. Expansionary monetary policy pursued by Central Banks involving asset
purchases to reduce bond yields and increase liquidity in capital markets.
G7 Group of seven industrialised countries comprising US, UK, France, Germany, Italy, Canada, Japan
European Tourism in 2014: Trends & Prospects (Q4/2014) 35
© European Travel Commission February 2015
ETC Member Organizations
Austria Austrian National Tourist Office (ANTO)
Belgium Flanders: Visit Flanders
Wallonia: Tourist Office for Wallonia-Brussels
Bulgaria Ministry of Economy and Energy
Croatia Croatian National Tourist Board (CNTB)
Cyprus Cyprus Tourism Organisation (CTO)
Czech Republic CzechTourism
Denmark VisitDenmark
Estonia Estonian Tourist Board - Enterprise Estonia (ETB)
Finland Visit Finland – Finpro ry
Germany German National Tourist Board (GNTB)
Greece Greek National Tourism Organisation (GNTO)
Hungary Hungarian Tourism Ltd.
Iceland Icelandic Tourist Board
Ireland Fáilte Ireland and Tourism Ireland Ltd.
Italy ENIT – Agenzia Nazionale del Turismo
Latvia Latvian Tourism Development Agency (TAVA)
Lithuania Lithuanian State Department of Tourism
Luxembourg Luxembourg National Tourist Office (ONT)
Malta Malta Tourism Authority (MTA)
Monaco Monaco Government Tourist and Convention Office (DTC)
Montenegro National Tourism Organisation of Montenegro
Norway Innovation Norway
Poland Polish National Tourist Office (PNTO)
Portugal Turismo de Portugal, I.P.
Romania Romanian National Authority for Tourism
San Marino State Office for Tourism
Serbia National Tourism Organisation of Serbia (TOS)
Slovakia Slovak Tourist Board
Slovenia SPIRIT Slovenia
Spain Turespaña - Instituto de Turismo de España
Sweden VisitSweden
Switzerland Switzerland Tourism (ST)
Turkey Ministry of Culture and Tourism
36 European Tourism in 2014: Trends & Prospects (Q4/2014)
© European Travel Commission, February 2015