International Seminar:

“World Tourism: Responding to the

New Challenges in the Global Economy”
Organized by the Permanent Secretariat of the Affiliate Members of
UNWTO and the Spanish State Secretariat for Tourism

CONCLUSIONS

FITUR, Madrid, Spain

29 January 2009
INTRODUCTION

This edition of the Seminar took place, as opposed to previous editions, with
the knowledge that world tourism has been negatively affected by the
financial crisis over the course of the past year and that the projections for
2009 confirm the decline which started in 2008. For this reason, an attempt
has been made at evaluating the current conditions which are looming over
the sector in the context of the fragile state of the world economy; the
consequences that have arisen from this and the most appropriate responses
that should be made.

The Seminar, which was inaugurated by the Deputy-Secretary General of

UNWTO, featured the participation of various Spanish governmental tourism
bodies with the Spanish Secretary of State for Tourism, as well as important
representatives from other Member States of the Organization. These
delegates were joined by over 200 attendees from a diverse range of business
and private sector organizations from over thirty countries.

Finally, the important and valuable contributions made by the experts who
were invited to speak must be acknowledged. They provided a panoramic and
view of the current state of the sector, well adapted to the nature of tourism
itself.

The most relevant conclusions reached during the three debates that took
place are summarised here:

1. The tourism sector has displayed enormous strength when faced

with severe difficulties in previous years; however this crisis is
distinct and appears to be even more serious than ever before. The
gravity of this crisis is due to multiple inter-related factors and is
intrinsically connected with a profound structural crisis in the global
economy. This is occurring at the same time as tensions are arising
in vital life systems (water, climate…) and in the availability of some
basic resources (oil, food,…).
2. The main challenge at this is time is not to lose perspective. It’s
essential to work on current problems but with a long term
perspective developed in line with the UN Millennium Development
Goals.

3. Given its global dimension, tourism is not about to disappear and

people will not stop travelling; however the paradigms in which this
activity exists are mostly likely to change substantially over the next
few years. The future is going to be very different. We have a great
opportunity to revive the sector and lead the change for a new
model of tourism which will ensure a better future for all.

4. Tourism will survive the crisis however, the crisis will significant
negative consequences, most of all from an employment point of
view. Governments must play their part by continuing to invest in
the sector, taking into account its significant value as an export and
its potential to lead the way out of the current crisis. The tourism
activity generated by this investment must reflect new
environmental challenges, the availability of essential resources and
a demand for a more ethical and responsible approach to tourism
which cannot be postponed.

5. At times of high uncertainty, such as now, we should open the door

to new opportunities. For example: improving the quality of
services, destinations and products. Now is also the time to put
leadership and good business management to the test.

6. It is consumers who are currently in an advantageous position and,

as such, businesses should do their utmost to gain their confidence
by committing themselves to the following: improving quality;
competing better to maintain their market positions by means of
flexible pricing, optimizing the use of new technologies or increasing
profit from existing customers.
 7. So as not to avoid negative perceptions, a crucial means of gaining
the consumers’ trust is to diffuse high quality analysis of current
tendencies at all times.

8. Whichever responses to the crisis are implemented and whatever

their geographical scope, seeking new business alliances as well as
strengthening the dialogue and cooperation between public and
private actors is highly advisable and must be insisted upon.

HIGHLIGHTS

“This crisis is different because it is not confined to one geographic region. It is of

indefinite shape and proportion and the parameters are unclear. However the most
important effect of the crisis is the risk of losing perspective –and it is also the
biggest challenge. We must avoid the danger of forgetting the long term goals –the
Millennium Development Goals specifically – by only focussing on short term
preoccupations”.
Taleb Rifai, Deputy Secretary General, UNWTO

“The Spanish government has invested 800 million dollars’ worth of assistance to
developing countries via the UN. Part of this investment will enable the activation
of many tourism development projects in these countries. By making this investment
and in supporting UNWTO, the Spanish government has shown its commitment to a
global response to this crisis. (…)
The Spanish government has made its biggest investment to date in the
improvement of tourism infrastructure in Spain and this demonstrates confidence in
the future of the country’s tourism sector”.
Joan Mesquida, Secretary of State for Tourism, Spain
“50% of tourism is generated by private industry. We must work closely with the
private sector to ensure prosperous development for the future. (…)
If we lose confidence, the consumer will feel this and a slowdown will result which
will only reduce the financial resources available to the consumer. (…)
Today we have a good opportunity to change the model of tourism development.
There is no business model that can stand over 50 years of use so the time has come
to change and experiment, to ensure a better future for us all”.
Eulogio Bordas, Chairman, UNWTO Affiliate Members

“Now more than ever we must institutionalize tourism activity. We will not be able
to do this by reducing our message or by clouding its meaning. (…)
It is now time to promote active participation, bring together opponents, remove
obstructions, strengthen alliances, share knowledge, and improve our businesses and
the quality of our work. That is why now is the right time to unite best management
practices with the good social and environmental ethics that we all share”.
Javier Blanco, Executive Director, UNWTO Affiliate Members

“The crisis presents many opportunities; the drop in the real estate sector will mean
a decrease in the cost of land, which can allow us to improve our hotel supply. The
sector has the opportunity to be more creative in its delivery of unique experiences.
If we analyse the consumer’s subconscious we will understand the experiences they
seek”.
Javier Gómez- Navarro, President of the Spanish High Council of Chambers of Commerce
and Industry

“In general, people are negative about the general prospects of the world economy,
but positive about their own prospects and propensity to travel. People will
continue to travel, but they may travel less or choose less expensive travel options.
The sector needs to accommodate this by cutting costs on the non-essentials without
compromising on quality and customer service. Promotions will require multi-
channelled responses and specific packages should be created to target different
markets”.
Martin Brackenbury, President, International Federation of Tour Operators-IFTO
Please click on the presentation
“Advanced and emerging economies are need to adopt the following measures as a
priority: stabilize the financial system and get it running again; restore confidence
in the financial sector; avoid damaging healthy sectors; reactivate the economy.
Crises are paradoxical because while they reveal structural threats and weaknesses,
they also force us to address sustainability issues, energy dependence and
adaptation to climate change. (…)
“A slowdown is necessary to rectify the excesses of a boom”.
John Kester, Chief, UNWTO Market Trends, Competitiveness and Trade in Tourism
Services Section

Please click on the presentation

“Is this an economic crisis or an economic change? After the best growth period in
modern history we are now in deep economic crisis, and facing serious issues
relating to climate change and biodiversity. It is imperative that we adapt, change
our mentality and reduce the sector’s impact on the environment”.
Fernando Prats, Urban Planner

“Globalization has made the world smaller, more integrated and therefore more
interdependent. Today, there is no country or group of countries which can decouple
from a world economic crisis. World economy matters for international tourism. Its
growth follows the same path and there is a strong correlation between the growth
of gross domestic product (GDP) and the growth of the aggregated international
tourism demand”.
Peter Keller, Director of the Tourism Institute, University of Lausanne (Switzerland)
Please click on the presentation

“States must avoid spending more and more on promotion. Some are spending more
on promotion while spending and arrivals have fallen. We must keep destinations in
the mind of the consumer but ask at the same time ‘how effective is our spending?’
(…)
Greater amounts of money will have to be spent in the experience economy and on
creating distinctive products. (…)
In the future we will have to start designing our destinations based on the way the
business and public sector are linked together and how they are capable of creating
products with identity; ie. change DMOs from top-down organizations to bottom-
up”.
Carlos Martins Manuel Da Costa, University of Aveiro (Portugal)
“Businesses must take into account broader social and environmental impacts, and
work with lobby groups to become part of the solution, not the problem. As a sector
we have to be respectful to the environment and appreciate sustainability. My
company has managed to save 50,000 Euros a year simply by implementing cuts on
its energy consumption”.
Esther Trujillo, Vice President, Sol Meliá Hotels and Resorts

“For us, there are two factors that will impact on the development of the crisis:
firstly, volatility in the price of oil and secondly, the current economic
environment’s effect on tourism. (…) However, to meet the new requirements of
the market, our sector will need to become more customer oriented, give a good
level of service and to innovate and improve our product”.
Antonio Pimentel, Deputy Director for Air Transport Policy, Iberia L.A.E.

“Air control and regulation are still exercised by states. States must become more
involved by encouraging open skies, controlling airport fees (…). We need
liberalisation to support tourism development but this cannot be done solely
through fiscal measures. (…)
In the light of the current economic conditions, airlines are reducing capacity
supply, creating mergers and alliances and developing technology to reduce fuel
consumption and environmental impacts. We have to simplify our business as much
as possible.”
Javier Gallego Alonso, Head of Operations, IATA, Europe

“This crisis is not a reaction to a single event, but to a whole series of events. It has
affected corporate travel, as well as leisure travel. It is time to think globally and
act locally. (…) Don’t forget the power of the internet -online bookings have
continued to grow significantly despite this crisis”.
Diego Lofeudo, Director of Market Management, Eastern Med & Africa, Expedia Travel