AN168 - Traffic declines are widespread
28 April 2009

Was it Brendan Behan who once said, “the Irish are a fair race, they never speak well of themselves”?  Well it is true that some of the time at least we can feel as if we are taking more pain in the current recession than our neighbours, and that we have brought all this on ourselves.  That however would be a gross over-simplification and an incorrect analysis of the facts.

Like every other nation on earth, we are caught up in a global recession that has its origins in the reckless and greedy behaviour of financial institutions in the world’s largest economy.  Sure, we compounded our own situation by over-exuberant participation in many of these exotic financial instruments, and our obsession with owning bigger and more property (there you go, Behan was right).

Ireland could never have been immune to a global economic downturn, particularly given the open nature of our economy and the fact that we export over 80% of everything we produce.  And tourism is of course an export.

So given that all our source markets are experiencing severe recession, it follows that exports, including tourism, will decline.  But there is also good news.  The very open nature of our economy means that as global recovery takes hold, our exports, including tourism, will recover strongly.  In the meantime we will unfortunately endure a difficult trading period, just like our neighbours.

The International Air Transport Association (IATA) reported that international traffic for March fell by 11% over March last year (make that 9% when you factor in that Easter fell in March last year).

North American airlines saw traffic drop 13.4%, while European carriers had their international traffic down 11.6%.  Demand has been adversely affected by rising unemployment in key markets such as Germany and Spain, where it reached 8.6% and 17.4% respectively.

IATA estimates that passenger traffic will contract by 5.7% this year, leaving airlines with losses of $4.7 billion.

Spain’s biggest airline, Iberia, and National Tourist Board, TURESPAÑA, are jointly funding an international campaign in a bid to revive the country’s flagging tourism industry.  International tourism figures declined by 16% in February.

Italy has launched a massive $13 million advertising initiative called Italia Much More, that seeks to lure tourists from North America and Europe.  The slump in their industry has already translated into a loss of $5.2 billion and at least 150,000 jobs.

A look at how airports are doing always gives a flavour of the way things are.  Initial March results for some major European airports suggest that the more leisure oriented airports are seeing the biggest decline in traffic: 

Amsterdam -14.5%
Barcelona -20%
Brussells -14.7%
Dublin -13.9%
Frankfurt -9.2%
Gatwick -17.7%
Heathrow -7.5%
Stansted -15.8%
Madrid -14.7%
Manchester -18%
Milan Malpensa -29.8%
Paris CDG -9.1%
Paris Orly -11.2%

Little solace in all that, other than the mild comfort of knowing it’s not just us.

April 28th 2009

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