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Canada High: USA’s northern neighbor benefits from “Trump Slump”

Canada High: USA’s northern neighbor benefits from “Trump Slump”
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Almost a year to the day since the US public voted for Donald Trump to become their next leader, there are signs travellers are turning to alternative destinations, with Canada in particular seemingly benefiting from a ‘Trump Slump’, according to research for World Travel Market London – the leading global event for the travel industry – released today (Tuesday 7 November) at WTM London.

Mexico, subject of Trump’s pre-election promise to not only build a wall but get his southern neighbour to pay for it, may be having the last laugh. Cancun is forecast to achieve four times the increase in tourism numbers this year than any of the seven most-visited US cities, according to the Top 100 City Destination Ranking WTM London Edition, by Euromonitor International.

Trump was declared presidential election winner on November 9 2016 and was inaugurated as the country’s 45th president on January 20, 2017. Since then, he has rarely kept out of the international spotlight, regularly hitting the headlines with a series of controversial speeches, policies, opinions and tweets – many of which have impacted US tourism.

The Top 100 City Destination Ranking WTM London Edition, by Euromonitor International, says: “Since the arrival of President Trump in the White House, there has been much uncertainty about what is to come next. Donald Trump entered office on the back of claims that he would close the US border to build a wall between Mexico and the US and end trade agreements, all potentially affecting the travel industry.

“One of his first actions was to pull out of the Trans-Pacific Partnership (TPP) in January 2017. Similarly, he has threatened to pull out of the North American Free Trade Agreement (NAFTA), which allows free trade between Canada, Mexico and the US.”

If he follows through with his threat, the impact on inter-regional travel would be considerable, while the impact of Trump on inbound arrivals to US cities is being closely watched by city tourism boards, according to Euromonitor.

Seven of the 10 Americas cities in the Top 100 City Destination Ranking are located in the US: New York, Miami, Las Vegas, Los Angeles, Orlando, San Francisco, and Honolulu. But it is expected that 2017 performance of these cities will fall behind cities in Canada and Latin America.

For example, New York is forecast to achieve 13.1 million visitors in 2017, a 3.6% increase on 2016’s figure of 12.6 million. Miami, Los Angeles and Orlando expect increases of 3.1%, 4% and 2.7% respectively, while Las Vegas is expected to record a drop in visitor numbers for 2017 of 0.8%.

By contrast, Toronto predicts an 11.2% increase in visitors for 2017, to 4.45 million, while Cancun in Mexico is forecast to achieve a 16% increase, to 6.76 million.

“New York City is the clear leader in the Americas. To many it might seem that the city is untouched by what is happening in Washington DC, but NYC & Co has revised its forecasts for 2017, expecting a potential fall of 300,000 visitors, although this is likely to be a worst-case scenario,” the report continues.

The US’ northern neighbour, Canada, appears to be benefiting from anti-Trump sentiment. The country’s leader, Justin Trudeau – young, trendy, clever, articulate and welcoming – is seen as having the exact opposite to his US counterpart’s ‘America First’ outlook. Toronto, one of its key cities, has registered strong performance since hosting the Pan-American Games in August 2015.

“Canadian cities Toronto and Vancouver are in a strong growth period, as the low Canadian dollar ensures Canada is an affordable holiday destination for many. Canada is also likely benefiting from some substitution effect, as its current political vision is the near-opposite of its southern neighbour, advocating openness and stronger ties with other countries,” the report says.

To the south of the US, Cancun is expected to be the strongest growing city in 2017 in the Americas and, while the US is the largest source market, Mexico is becoming increasingly popular with visitors from Europe and Asia.

Cancun’s growth has been at the expense of Rio de Janeiro, which performed strongly in 2016 with an increase in arrivals of 12.3% year-on-year due to the Olympic Games, yet which is expected to register a decline in arrivals in 2017. This trend is similar to what happened in 2015, when arrivals slumped after the 2014 World Cup in Brazil.

Euromonitor says other contributing factors include the Zika virus, which was finally under control in mid-2017, and political unrest at the end of 2016.

World Travel Market London, Senior Director, Simon Press, said: “A year ago, on Tuesday November 8 2016, US voters went to the polls and, less than 24 hours later, shell-shocked delegates arrived on the last day of WTM London 2016, to the news that Trump had done it – he’d become the 45th president of the United States.

“The full Trump effect on travel to the US remains to be seen, but, as Euromonitor International’s fascinating insight shows, some US cities are downgrading their forecasts, while neighbours Canada and Mexico look set to increase their visitor figures.”

eTN is a media partner for WTM.

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