Tour Operators are Among Those Suffering from a Decline in Tourists.

According to the National Chamber of Tourism (Canatur) both Costa Rica’s golden and central pacific coasts are beginning to feel a reduction in the rhythm of the tourism growth that they have become so accustom to over the previous years. Alberto Lopez, the executive director of Canatur, informs us that “What we have done is lit a semi-warning signal”, in order to alert the county of the fall of its biggest cash cow: tourism.

Canatur announced that the figures from this past year show that tourism grew 15 percent in April 2008 and 13 percent in June of 2008. The statistics continued to fall during the month of July showing a measly 12.2 percent growth, thus hitting the economies of the popular tourist destinations of Guanacaste and Puntarenas hard.

The months of June and July tend to see a surge in tourism as most families from the United States go on vacation during the summer months, and most students flock to Costa Rica beaches to soak up some sun and Spanish classes. However, this year that seems not to be the case.

Vice president of Canatur, Gonzalo Vargas, said that the fall in tourism can be attributed to the increasingly high prices of fuel, the recession that is taking place in the United States, and the reduction in the frequency of flights around the world.

Canatur has also reported that the northwestern province of Guanacaste is experiencing the same decline in tourism that affected them last year; a 3.3 percent decrease in June and another 1.9 decrease for the following month of July.

The president of the Guanacaste Chamber of Tourism (Caturgua), Alvaro Conejo, said that the decrease in foreign tourists is affecting small hotels, tour operators, and rental car agencies the most. This makes it harder for Costa Rica’s authentic local flavor and business to stay afloat in the worlds ever-changing economy.

It is more than just the smaller local run businesses that are feeling the slip. The Daniel Oduber Quirós International Airport in Liberia, which receives most tourists headed to the Golden Coast, is feeling the consequences of the decline as well.

“We are urgently accelerating negotiations to put out a bid for the construction of the new airport building”, Conejo said. The enlargement of this airport is essential to be able to accommodate more tourists. According to projections of Caturgua, half a million tourists will utilize that air terminal in 2010 alone, adding a huge potential for increased tourism.

The usually popularly frequented Pacific surf town of Jaco is experiencing a decline in tourism and souvenir sales as well. Store owner of the souvenir shop Tairona Ernesto Herrera, is now resulting to selling his merchandise on the beach instead of in his shop. “I have to go out to the beach because that’s where the people are,” Herrera said. “It’s not something that I am accustom to, but in the six years I have worked as a merchant this is my hardest.” However it isn’t just souvenir sales that are falling in Jaco.

Dennis Reyes who rents surf boards in the town known best for its waves is noticing a significant fall in clients this season as well. Reyes has resulted to forming alliances with other companies in the area in order to help make up for the lack of business. He generally rents around 20 surf boards a weekend, however, the number has gone down to half that recently as last Sunday he only sold five all day. Reyes is planning to work with other companies who offer canopy and horseback riding tours in order to offer one package with all three activities so as not to lose business all together.

With tourism undoubtedly falling, the Institute of Tourism (ICT) is asking the Budgeting Authority of the Treasury Department to approve a budget of $20 million in order to promote Costa Rica tourism abroad during 2009.

The ICT’s plan is to invest the money in advertisements in magazines and on the Internet to attract more tourists to the small Central American country. Also, ICT plans to employ resources to establish cooperative campaigns with some of the airlines that are either interested in flying to the country or already do so.

“We want to strengthen our efforts of promotion and marketing, advertising and also to create campaigns with wholesalers and tour operators throughout the world”, Minister of Tourism, Carlos Ricardo Benavides, said.

The approval of the current budget for 2009, takes precedence over the other topics that will be discussed in the Legislative Assembly before December of this year. Benavides did point out that the ICT proposed that $6 million of the requested funds would come from what was left over from their 2008 budget. A considerable portion of the requested budget will be dedicated to promoting the country as a tourist destination in the United States and Europe.

This seems more than reasonable as a shocking 54 percent of the visitors that arrive in Costa Rica are Americans (chiefly from the states of California, New York, Texas and Florida). Europeans represent 17 percent of the tourists that arrive here, usually hailing from Germany, Italy, Spain and France.

“Europe is important and it will continue to be a focus next year in the budget, but we are not going to leave out the fact that the United States is our main market,” Benavides added.

Last July, Benavides created an aggressive campaign targeting the United States to attract more visitors for the following summer. The campaign focused on promoting Costa Rica in magazines dedicated to travel, science, nature and culture including National Geographic, The Smithsonian and Conde Nast Traveller. ICT also published ads with irresistibly eye pleasing images of the Arenal Volcano on buses in both New York and San Francisco.

Last year alone 1.9 million visitors flocked to Costa Rica generating $1.92 million in revenue. We can only hope that if the $20 million budget proposed for next year is approved, that Costa Rica can use the increase in revenue to help preserve its unrivaled beauty for the many tourists to come.

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Filed under: Business on August 26th, 2008