January 30, 2013 at 5:54 p.m.

We need a new Tourism Minister to tackle downward spiral


By Larry Burchall- | Comments: 0 | Leave a comment

 Tourism figures for 2009 were awful and it is time Bermudians gripped the awful tourism reality.

Accurately and honestly, this is what has ­happened. 

In 2009, there were 318,528 cruise visitors.

This was up 11 per cent on 2008's 286,408.

These 318,528 spent $64,900,000, so spending was up 12.5 per cent on 2008's $57,700,000. That was good.

Now examine air arrivals. These numbered 235,860 in 2009.

This is 11 per cent fewer than 2008's 263,613. These 235,860 spent $266,400,000. So spending was down 22.6 per cent on 2008's $344,100,000. Not good.

Probe deeper. Total arrivals in 2009 were reported as 554,388 ­compared with 550,021 in 2008.

So there was an overall increase of 4,367 persons for a 0.8 per cent increase in 2009.

The total income from tourism in 2008 was $401,800,000. The total tourism income for 2009 was $331,300,000. So total income from all tourism was down by $70,500,000, or 17.6 per cent less. 

A 0.8 per cent increase in overall tourist numbers brought a 17.6 per cent decrease in overall ­income. So we have a small ­increase in numbers but a huge drop in income.

More bodies, fewer dollars. More equals less (see table, right).

There is less than one per cent difference between total dollar earnings in 1983 and 2009 - but there is a clinch.

In 1983, a standard loaf of bread, 22 slices, cost $1.60.

Chucking out all those zeroes, the $329 dollars from 1983 would have paid for 206 loaves of bread. In 2009, the same loaf cost $4.85.

Again, chucking out the zeroes, the $331.30 of 2009 would have paid for only 68 loaves of bread.

Less value

A full 22-slice loaf cost $1.60 in 1983. In 2009, $1.60 could only buy seven slices.

The $331,300,000 earned in 2009 was only worth about $110,000,000 in 1983's buying ­power.

In 2009, Bermuda gets an ­average of 560,000 tourists.

But Bermuda is now getting the equivalent of only 33 cents in ­value from each tourist dollar. Same number equals less value.

In 1983, leisure tourism was bringing in about 65 cents of every dollar of foreign exchange that came into Bermuda.

The remaining 35 cents was from profits/dividends from overseas investments by Bermuda companies, a just starting up ­international business, the four active military bases (HMS ­Malabar, CFS Daniel's Head, USN Annex and U.S. Naval Air ­Station), the NASA installation and wealthy foreign residents.

In 2009, leisure tourism brought in about 11 cents out of every ­dollar of foreign exchange - a huge 83 per cent drop from the 65 cents of the 1980s.

Despite their increased ­numbers, low-spending cruise ­arrivals bring in less than three cents of that 11 cents total.

In 2009, leisure tourism is a "dime" industry. For 16 years, since 1994, despite overall ­numbers staying high, the ­number of higher-spending air arrivals has been falling and total income and total value from tourism has trended down.

Bermuda must monitor tourism income, not tourist ­numbers.

Because total tourist numbers stayed high, they became a smokescreen concealing the harsh reality of falling income.

Bermuda's maximum annual carrying capacity for cruise visitors is probably about 500,000.

This number of cruise visitors will probably require about 225 to 250 mega-ship visits throughout an eight-month cruising season.

But 500,000 cruise visitors will only generate $100-110 million.

However, 300,000 air arrivals could easily generate four times as much - about $450 million. I believe Bermuda is dangerously close to redefining itself - or ­getting redefined - as a low-end and cruise ship destination.

If Bermuda does get redefined as such, the island will jeopardize its ability to reposition or rebrand itself as a high-end destination for air-arriving, land-staying visitors and income from air ­arrivals will continue dropping.

Bermuda has been inadequately served by a non-existent - or extremely short-sighted or badly managed - national tourism marketing and directing ­programme that has been kept ­going for far, far too long.

Failure

Re-examine those numbers. Earnest, angry or smooth ­rhetoric does not change those numbers. Those numbers are fixed. Those numbers show and prove the undesirable consequences of past actions. 

There must be positive change. Admit failure. Stop the now ­blatantly obvious muddling and fumbling and wasting of time, ­energy and money. Don't lose the last bits of fading opportunity.

Change from the concept of the Tourism Department. Change the methodology. Change the Minister. Change! Change! Change!

Without change, Bermuda will simply spiral farther down - for the 16th consecutive year.[[In-content Ad]]

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