Increased non-resident tourism expenditures in 2004; positive outlook for 2005

Tourism, Culture and Recreation Minister Paul Shelley today provided an overview of the 2004 tourism season and an outlook for 2005. Despite a soft start and a mixed picture in the province�s regions, Newfoundland and Labrador had an improved tourism season overall in 2004 as compared to 2003. To the end of December 2004, there were an estimated 449,300 non-resident visits to Newfoundland and Labrador and an estimated $330 million in tourism expenditures in the province, representing increases of six per cent and 10 per cent respectively over 2003 levels.

Minister Shelley said Government recognizes the importance of marketing the province for the long-term and that through consistent marketing efforts, the province will continue to grow its share of non-resident visitors and spending.

"Despite the challenges the tourism industry faced from a national perspective in 2004, including the high value of the Canadian dollar, economic and business cycles, escalating gas prices, and the changing habits of consumers, our province�s tourism industry experienced growth," said Minister Shelley. "This reinforces the importance of investing in tourism marketing. For this reason, our government has committed to invest an additional $1 million in tourism in Budget 2005. This investment will allow us to continue to market our destination, which will result in increased visitation to the province. An investment in tourism is an investment that will continue to result in economic return to the province."

While Marine Atlantic traffic levels were down from 2003 volumes, both airport and cruise traffic increased in 2004. Air passenger movements in and out of the province, the largest share of all traffic movements annually, were up 13 per cent to the end of December. The province�s cruise industry and conventions market also experienced significant growth in 2004. The conventions market experienced a 40 per cent increase in 2004, while the province received nearly double the number of port calls and a 25 per cent increase in cruise passenger visits.

Interest in the province as a tourism destination also remained strong in 2004. Inquiries to the province�s 1-800 number and Web site reached almost 78,000 in 2004, up 1.3 per cent over last year, indicating continued interest in the destination.

While the province experienced an increase in some areas, ferry passenger traffic was down eight per cent in 2004 and non-resident auto declined 10 per cent, resulting in a mixed picture in the province�s regions. While some areas of the province benefitted from a strong growth in air and cruise visitors, other areas more dependent on auto travel experienced declines. Declining auto visits were also reflected in lower visitation at the province�s historic sites, museums, visitors information centres and public and commercial campgrounds.

Minister Shelley said he is concerned with the continued decline in ferry passenger traffic since the gulf ferry service provides a mode of transportation for about 30 per cent of the province�s non-resident visitors. "I am concerned about the impact that a decrease in passengers has had on our tourism industry. However, I am encouraged by the establishment by the federal government of a new Marine Atlantic Advisory Committee. The committee has already recommended a rate freeze on the ferry, which has been implemented for two years, and I am hopeful that the committee will identify issues with the current service and recommend long-term solutions."

Minister Shelley said he is cautiously optimistic about the 2005 tourism season. Consumer enthusiasm for travel is expected to rebound more strongly in 2005 where early signs of tourism recovery are encouraging. According to the Conference Board of Canada�s latest research, while the strong Canadian dollar is motivating outbound travel, the domestic outlook for Canadian travel looks stable and consumer confidence is supporting a positive outlook for 2005. In addition, inquiries to the province�s 1-800 number and Web site for January show an increase of four per cent over last year, while the Cruise Industry Association of Newfoundland and Labrador is reporting that port calls tentatively scheduled as of mid-February are ahead of last year.

"I am pleased with the province�s tourism performance in 2004, despite significant challenges both locally and nationally that dampened discretionary travel and resulted in a mixed season for regions of the province," said Minister Shelley. "While I recognize there are challenges, I take comfort in the continued interest in the province as a tourism destination and an optimistic outlook for 2005."

Media contact: Tansy Mundon, Communications, (709) 729-0928 or (709) 685-1741.

The following Backgrounders are available:
1. Provincial Tourism Performance 2004/ Outlook 2005
2. Regional Tourism Performance 2004
3. Stats 2004 (Detailed Travel Indicators)  (PDF)

2005 03 09                        3:50 p.m.