Caribbean Tourism Keeps Chugging On despite Hitting a Few Snags

Despite the widespread economic downturn, the Caribbean tourism industry has survived, albeit not entirely unscathed. However the region is once again showing an increase in arrivals and a moderate growth across industry value.

Increasing investments in the hotel sector as well as in international transport means have also begun to see results as a number of projects under development have come to fruition.

The BMI Caribbean Tourism report examines the growth and development of the Caribbean tourism industry, both inbound and outbound, paying particular attention to the hotels industry.

The reports cover Anguilla, Antigua & Barbuda, Aruba, Bahamas, Barbados, Belize, Bermuda, Bonaire, the British Virgin Isles, Cayman Islands, Cuba, Curacao, Dominican Republic, Grenada, Guyana, Jamaica, Montserrat, Puerto Rico, Saba, St Eustatius, St Kitts, St Lucia, St Vincent, Suriname, Trinidad & Tobago, and the US Virgin Islands.

The report considers the impact of the continuing global economic uncertainty on the Caribbean tourism industry, and evaluates the potential impact which the European debt crisis and the imminent US fiscal cliff will have on the region's tourist arrival figures, as these two areas represent the first and third biggest markets for the Caribbean tourism industry.

The report will also address the potential effects of the Brazilian World Cup in 2014, and Olympics in 2016, as Latin America represents the second largest tourist market based on arrivals figures. It is possible these two events will attract potential Latin American visitors away from the Caribbean, with the lure of once-in-a-lifetime events that are rather closer to home.

There has been a rise in global tourism levels, despite the economic uncertainty of the past few years, and BMI has changed its estimate for 2012 arrivals after the release of new regional statistics.

This highlights the resilience of the tourism industry in the face of a global recession. Surprisingly, despite its reputation as an expensive holiday destination (which saw it lose a lot of custom in the immediate aftermath of the events in 2007-2009), the Caribbean has seen a corresponding, albeit more moderate, upswing in its own tourist arrivals.

By 2017, total figures are forecast to reach around 20mn per year. Equally, cruise figures are estimated to have amounted to 17.4mn during 2012, and are forecast to reach 19.3mn by 2017. This growth has not been as pronounced as in other areas. This is largely due to the fact that the region's biggest tourist markets are the US and Europe.

The former has struggled to maintain its economic stability and is now facing the looming threat of an imminent fiscal cliff, while the latter is currently under the cloud of its sovereign debt crisis. Both scenarios could result in further economic instability and many potential tourists are opting to stay at home or go to cheaper, closer tourist destinations.

Moreover, despite continuous lobbying of the EU, European Parliament and the UK Government by the Caribbean Tourism Organization (CTO), the increase in air passenger duty from the UK to the Caribbean has not been cancelled, which is having an ongoing negative impact on those islands relying on the UK as a main tourism market.

In addition, much of Caribbean tourism has been concentrated in the cruise industry, which has suffered in line with other luxury travel options. Given the dependence of Caribbean economies on tourism, this will have a significant effect on economic growth in the region.