Tourism is a big contributor to the National Economy

  • ITIC has called on the Government to maintain its support for the Tourism sector by ensuring that the commitments made in the National Development Plan 2007/2013 are delivered.
  • Specifically over the 7 year plan, that calls for investment in marketing of €335 million, in product development of €317 million and, in training and human resources, €149 million.
  • In 2007 the industry generated 8.3 million out-of-state visitors and a further 8 million domestic trips.  That in turn generated €5 billion in foreign exchange earnings and a further €1.5 billion from domestic trips, making tourism a €6.5 billion sector.  Despite facing a challenging external environment in recent years, the Irish tourism industry continued to make a very strong contribution to the Irish economy.  This includes:

– contributing more than 7% to services exports each year as well as accounting for €1 in every €20 spent on goods and services in Ireland;

– contributing nearly €3.0 billion per annum in tax revenues to the Exchequer through expenditure on tourism-related goods and services, income tax earned from tourism-related jobs etc;

– supporting 250,000 full-time, part-time and seasonal jobs across a range of sub-sectors, and being a major source of jobs in a number of key regions;

– providing a more balanced spread of economic activity across regions, including in areas where there are few alternative economic and employment opportunities.

  • But tourism is not immune to the turbulence in the national and global economies, which is currently being experienced.  After more than a decade of solid growth, it is apparent that the industry must now adjust to operating in a much more challenging environment.
  • Growth in the Irish economy will slow down significantly in 2008 and 2009, and Ireland’s key source markets are following a similar pattern.
  • In the short term Ireland is also facing additional trading difficulties in the British and North American markets due to currency issues. The doubling of oil prices, coupled with the airlines rescheduling of services to optimise opportunity under the open skies regime, has presented added challenges to the West of Ireland.  Retaining the existing level of air services to Shannon is critically important in the present economic environment.
  • But, the prospects for global growth in international travel and tourism remain positive in the medium to long term.  There is a confidence that the industry will manage its way through this difficult period and return to a pattern of sustained growth, though it will not be easy.
  • A key factor in achieving this will be the effectiveness of our international and domestic marketing efforts.  A greater number of destinations will be competing for fewer international travellers, so Ireland’s voice must be heard above the crowd.  It is critical therefore that adequate funding for the two tourism agencies, Tourism Ireland and Failte Ireland, is maintained, so that we can at least retain market share.
  • The industry understands and supports the Government’s determination to get to grips with public sector costs.  In so doing however, it is highly important to recognise the serious issues arising from the dramatic changes in the external environment, which are impinging on the short-term prospects for the tourism industry.
  • Government support has been a key contributor to the success of Irish tourism in the past 20 years, and it has been instrumental in making the sector such an important component of the Irish economy.  This support will continue to be crucial if Irish tourism is to be sustained in this more difficult economic climate.
  • The tourism sector on the other hand has always given a handsome return to Government by way of tax revenues.  Last year that was €3 billion, put another way, that’s almost 4 times as much in one year as the planned Government investment in tourism over 7 years.

Not bad eh!

  • To get the fuller picture on tourism’s big contribution to the economy click here for our recent report (MS Word).
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