WITH THE NUMBER of international visitors traveling to the U.S. in 2017 dropping, several trade groups, including AAHOA and the U.S. Travel Association, are teaming up to fight the decline. It’s an effort that the new Visit U.S. Coalition says requires help from the Trump administration, though some experts blame some of the administration’s recent policies for discouraging foreign visitors.
The U.S. share of the international travel market slipped from 13.6 percent in 2015 to 11.9 percent in 2017, according to USTA. Subsequently, international travelers to the U.S. spent 3.3 percent less through November than at the same point the previous year, according to the November International Trade report released recently by the Commerce Department’s Bureau of Economic Analysis.
That loss of spending led to losses of $4.6 billion and 40,000 jobs for the U.S. economy, according to USTA. If the U.S. had maintained its 2015 market share, USTA said it would have gained 7.4 million more international visitors, $32.2 billion in additional spending and 100,000 jobs.
The hotel industry is particularly hard hit by the dip in international travel, AAHOA president and CEO Chip Rogers said. “Travel and tourism are a vital part of the hotel industry’s bottom line and a substantial driver of America’s economy,” Rogers said in a statement last week announcing AAHOA’s participation in the Visit U.S. Coalition.
A 2015 study by AHLA said that international travelers accounted for about 20 percent of all lodging sales, said Bhavesh Patel, AAHOA chairman and principal for ADM Hotels & Development.
There is not data clearly demonstrating a connection to the Trump administration’s anti-immigration policies that include a ban on travel from certain Muslim-majority countries and insistence on building a wall along the U.S.-Mexico border. However, the decline corresponds with Trump’s first year in office and a matching drop in U.S. approval abroad, according to the New York Times.
However, it’s in the administration’s best interest to promote the U.S. as an international travel destination, said USTA President and CEO Roger Dow. “Flourishing international travel is vital to President Trump’s economic goal of sustained three percent GDP growth, and the Visit U.S. coalition is being founded for the express purpose of helping him achieve it,” Dow said. “Our guiding principle is that we can have strong national security and still welcome legitimate international visitors. We can do both—and, in fact, without effective security there can be no travel, as we witnessed after September 11, 2001.”
At the same time, USTA points out that the decline in international visits to the U.S. predates Trump. The U.S. share of international travel began to slide when it dipped from 13.6 percent in 2015 to 12.9 percent in 2016, the year Trump was elected. “After almost a decade and a half of relatively sustained post-9/11 recovery, since 2015 there’s been evidence that the country has gotten complacent with the policies needed to support this vital economic engine and job creator,” Dow said.
There are actually several factors behind the decline in international travel to the U.S., Patel said. For example, the dollar has been increasingly strong in recent years, making travel here more expensive for those from countries with weaker currency.
“The dollar strengthened 25 percent between July 2014 and March 2015,” Patel said. “The Federal Reserve has also been increasing interest rates since 2015, which increases the demand for dollars, while the European Central Bank lowered the value of the euro by doing the opposite.”
It should be noted that in 2017 the dollar experienced its first decline in five years, according to CNN and Wall Street Journal. Part of the reason for the decline is a strengthening Euro, according to CNN, but another part is concern over political discord in the U.S.
Patel pointed out that domestic travel in the U.S. increased 1.2 percent in 2016.
America’s decline comes at a time when international tourism worldwide grew 7 percent globally, according to The World Tourism Organization, with much of that growth was seen in France, Germany, Spain and China. WTO expects the growth to continue worldwide in 2018 at a rate of 4 to 5 percent.
The Visit U.S. Coalition will propose specific policies for improving the countries attraction to international tourists in coming weeks. Patel said the Trump administration, like any administration, can play a major role in revitalizing travel because the President has the greatest voice for encouraging travelers to come to this country.
More specifically, the administration can offer more support for the Brand USA initiative, a private-public partnership founded by the Travel Promotion Act of 2010 to promote the U.S. as a travel destination. Promoting Brand USA is part of the Visit U.S. Coalition mission.
“Unlike many other nations, the U.S. government does not fund tourism marketing with taxpayer dollars,” Patel said. “The Brand USA initiative is funded by its partner organizations whose donations are matched with a portion of the Electronic System for Travel Authorization fee that covers travelers from Visa Waiver Program markets. The Trump administration can advocate for the growth of this nonprofit and increased marketing of U.S. destinations abroad.”
Meanwhile, individual hotels can take steps to draw what they can from the existing international travel market in the U.S., Patel said. “Any hotels interested in international travelers would need to know how hotels and brands market themselves to international travelers and how their services and rates meet a traveler’s specific needs,” he said. “Some hotels offer lower rates for international guests through tour companies who will book a block of rooms.”
Along with AAHOA and USTA, coalition founding members include the American Hotel & Lodging Association, American Gaming Association, International Association of Exhibitions and Events, Society of Independent Show Organizers, National Restaurant Association, National Retail Federation, American Society of Association Executives and U.S. Chamber of Commerce.