If you haven't heard by now, the numbers are in! Caribbean tourism continues to break new ground, surpassing 29 million arrivals for the first time in our history and once again we have grown faster than the global average. Despite political uncertainties, security and economic challenges in our main source markets, tourist arrivals to the Caribbean increased by 4.2 per cent in 2016, better than the 3.9 per cent overall, internationally.
Encouragingly, we welcomed over one million more visitors last year than in 2015, to reach 29.3 million, continuing our proud record of growth for the seventh straight year.
In a nutshell, here's an outline of what is important to know about last year's performance.
How did this market perform?
The United States continued to be our primary long-stay market, increasing by three-and-a-half per cent and providing just about half of all arrivals. But while figures from the U.S National Travel & Tourism Office for the month of November showed that the Caribbean's share of the U.S outbound market was second only to Europe, the growth rate was the slowest among all regions. There were over 14.6 million U.S. visits to the region, 3.5% more than 2015.
Why did it perform the way it did?
This performance was attributed to solid economic growth, a low unemployment rate and high consumer confidence in the U.S.
In Europe, we saw the strongest growth among the main markets as arrivals from this market totaled 5.6 million and improved by an estimated 11.4%. Surprisingly, the Brexit referendum in the UK and bumpy economic outcomes across continental Europe did not have the negative impact which some pundits had feared; not in 2016, anyway. The UK registered a growth rate of over four per cent and Germany is up by more than eight per cent.
The contributing factors to these performances include greater air access from the source market to the region and the realization of significant investments to enhanced infrastructure (airport redevelopment) and product (hotels).
Despite the issues of costly and fragmented intra-Caribbean travel, Caribbean intra-regional travel broke another record in 2016, as arrivals rose by 3.6% to register just over 1.7 million trips, the second consecutive year of growth. Robust double-digit growth was experienced in Guyana, St. Vincent & the Grenadines and the Turks & Caicos Islands.
This is a clear sign of the interest of Caribbean people in taking vacations to their neighboring countries. This boost came with Caribbean people's desire to attend celebratory events and festivals, most particularly throughout the Easter and summer seasons.
Although Canada was a strong and reliable market for us during the challenging recession years, it was uncharacteristically feeble last year, recording a drop of nearly 3.5 per cent when compared to 2015.
A lagging Loonie and sluggish first half economic output resulted in more than 70% of the reporting destinations having decreases in arrivals from this market.
In 2016, South American tourist arrivals were received primarily by the Spanish and Dutch speaking destinations. However, overall the region received about 11% fewer tourist arrivals from this market compared to 2015.
Continuing economic and political instability in two of three main South American source markets contributed to this decline.
How did this sector perform?
Our hotel partners experienced a few negative results when compared to 2015. The improvement in arrivals to the Caribbean was not reflected in improved hotel performance. According to Smith Travel Research, the primary revenue metrics were slightly down. The average daily rate (ADR) fell by less than a dollar to US$ 201.50 and revenue per available room contracted by 2.6% to US$ 134.48 while occupancy fell by 1.6 percentage points to 66.7%.
This outcome reflects the rise of the sharing economy and additional hotel room stock. However, it is important to note that the hotel revenue indicators are still above the performances recorded between 2012 and 2014.
2016 was also a record breaking year for Caribbean cruising. Cruise passenger arrivals to the region grew by about 1.3% to reach 26.3 million, in line with expectations at the beginning of 2016.
Larger ships, port enhancements and new destinations on the Caribbean cruise itineraries helped to increase the attractiveness of Caribbean cruise vacations.
Consistent with increases in stay-over and cruise visits, total visitor expenditure is estimated to have increased by approximately 3.5% to reach US$35.5 billion.
No doubt, we are proud of our region's performance in 2016 – the result of the combined efforts of our member countries, the CTO and our partners, who planned and executed a number of attractive and excellent programs and activities to attract visitors and have them talking and writing and sharing images about the Caribbean. Our Year of Romance, for example, received broad participation despite the threat of Zika, and our social media campaigns in support of the year reached over 20 million people.
Still, we had our shortfalls; our region did not break the 30 million arrivals barrier we had hoped for; but at 29.3 million there is still reason to celebrate.
Among the countries reporting increases, growth was uneven, ranging from flat, to as high as 19 per cent; while about one-fifth of the countries reported declines.
In conclusion, 2016 will be remembered as another successful year for the Caribbean's main foreign exchange earner, with new record levels of visitor expenditure, tourist- and cruise-passenger arrivals. But the year will also be remembered as a challenging one for the hotel sector which continues to be under pressure.
In the months ahead, we expect that tourist arrivals to the region will grow at a slower rate; between 2.5 per cent and 3.5 per cent in 2017. We also project increases of between 1.5 per cent and 2.5 per cent in cruise passenger arrivals. So all things being equal we're expecting growth in 2017, but it will not be robust.
For more information about the latest Caribbean tourism statistics, please visit www.onecaribbean.org.
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