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Tourism?s recovery

Tourism Minister Ewart Brown was this week celebrating improvements in tourism after reporting a 5.5 percent increase in the second quarter over the same period last year.

After years of watching tourism arrivals decline, any improvement is welcome. Still, statistics can be manipulated to tell virtually any story, and they need to be put into context.

Arrivals for the year to date (218,228) were up not only on 2004 (204,814), when the first half of the year saw a reduction in hotel rooms due to Hurricane Fabian, but they were also up on 2003 (210,298), when the Island had a more ?normal? stock of hotel rooms.

Nonetheless, virtually all of the increase in arrivals is a result of increased cruise visitors. Air visitors, who either stay in hotels or in private homes, increased from 123,742 to 131,151 or 6.3 percent between 2004 and 2005. Between 2003 and 2005, there was also an increase, but it was a relatively meagre 463 visitors, or about 0.3 percent. For what it?s worth, that?s a difference of 2.4 visitors a week.

It is a little unfair to complain when arrivals are at least going up and not down. But it?s worth making the point that the improvement is not that vast. It is even more important when the Tourism Ministry stated in its ?Visitor Profile? that ?if projections continue on track, Bermuda will complete 2005 with the best year in tourism since 2000?.

If it does, that will mainly be because of cruise passengers, of whom a record 82,773 came between April and June this year. The 92,115 air visitors who came were 3.9 percent more than in 2004, but fewer than in any one of the four years preceding it.

Additionally, raw arrivals figures don?t tell the whole story. It?s worth repeating that it is visitor spending, not arrivals alone, that have the greatest impact on the economy. One visitor who spends $1,000 in Bermuda is worth more than nine visitors who spend, say, $100 each. To get some idea of spending, it?s worth looking at bednights, which increased by 3.3 percent year over year, a slightly lower increase than the increase in air arrivals.

According to the Department of Tourism?s own airport survey statistics, air visitors spent $917 each in the second quarter this year compared to $1,048 last year. That suggests that even though arrivals rose by 3.3 percent, total spending may have fallen. Some caution must be taken with these figures because they rely on a relatively small sample of people being surveyed.

Nonetheless, the figures say that while visitors spent more on their accommodation, they spent less on meals, shopping and so on.

On the whole, cruise passengers, while they are very welcome, tend to spend less than hotel guests. Having said that, one can only shudder at the prospects for what?s left of Bermuda?s retail sector if the number of cruise passengers to the Island was halved.

But care must be taken not to read too much into overall increases in arrivals. If the hotel sector is not thriving, then tourism isn?t either. It?s that simple. Adding urgency to this is the fact that the Island?s hotel occupancy projections for the next three months are flat compared to 2003 or lagging behind. For that reason, Dr. Brown?s plans to launch special promotions with the hotels for the balance of the ?high season? are welcome.

If the tourism industry was a hospital patient, the doctor would be telling the patient?s family that it has shown some signs of improvement but remains in critical condition and still needs 24-hour care and attention.