differences between country pairs. Finally, they investi-
gate how changes in aspects of a country’s attractiveness
to business travelers—measured by different pillars of the
TTCI—could boost business and premium travel to a
country.
The results of their analysis show that the number
of passengers in premium seats are not driven only by
economic activities between countries, but also depends
on other factors. For particular country pairs, factors
captured by the T&T pillars—such as policy rules and
regulations, ICT infrastructure, and price competitive-
ness—explain to some extent the number of premium
passengers. The model demonstrates that any effort to
make improvements in these areas will tend to boost the
size of this travel market.
In “Hospitality: Emerging from the Crisis,” Alex
Kyriakidis, Simon Oaten, and Jessica Jahns of Deloitte
take a look back at hospitality performance across the
globe, before and during the crisis and then review
where we are today as we emerge from it. The year
2011 sees the hospitality sector across the world emerg-
ing from a period of significant challenge and consider-
able change, and the authors look at how this has
impacted different regions of the world in contrasting
ways. Some regions are already seeing a strong recovery,
as demonstrated by Asia; others continue to lag quite a
bit behind, as is the case in Europe.
The authors note that 2007 was a record year, with
world tourist arrivals reaching 900 million and healthy
double-digit revPAR growth across the globe. The global
economic crisis, the absence of credit, and the fragile
recovery in Europe we are now witnessing is seeing
some markets continuing to struggle while others
resurge. In contrast to 2007, in 2010 Asia Pacific leads
the pack in revPAR growth at 21.8 percent, exceeding
Europe’s absolute revPAR for the first time. Comparing
the 2010 performance with that of 2007 shows that
only one region, Central and South America, is ahead
of its 2007 peak by $12. Asia Pacific is now just $2 away
from its peak while Europe, at the back of the pack, is
$16 away.
The authors conclude that the economic crisis has
undoubtedly impacted regions in differing ways in the
context of the hospitality sector, yet its most significant
impact may have been to accelerate the shift eastward.
While the mature markets of Europe and the United
States remain large in absolute terms, their continued
growth is likely to be significantly outstripped by the
Asia Pacific region, which is already proving its strength
in the speed of its recovery.
In their chapter “Investment: a Key Indicator of
Competitiveness in Travel & Tourism,” Nancy Cockerell
from WTTC and Dave Goodger from Oxford Economics
highlight the importance of T&T investment for the
industry’s performance and outlook, as well as the impli-
cations of recent investment trends.
The authors describe how global T&T investment
closely tracked global tourism spending from the late
1980s to the mid 2000s along a stable upward trend
path and how, over the period 2005–08, growth began
to significantly outpace global tourism spending growth.
On the other hand, more recent trends show that,
between 2008 and 2010—as the global economy
entered recession and easy access to finance dried up—
investment in Travel & Tourism fell back sharply and
corrected much more than the drop in global tourism
spending. Nevertheless, over the 15-year period
1995–2010, global T&T investment increased by
approximately US$280 billion (measured in 2000
prices), with over half this increase attributable to the
United States and China alone.
As of 2011, WTTC’s annual economic impact
research, carried out in partnership with Oxford
Economics, is being even more closely aligned with
the UN Statistics Commission–approved 2008 Tourism
Satellite Account: Recommended Methodological Framework
(TSA:RMF 2008). However, as the authors explain,
the traditional approach understates the full economic
impact of Travel & Tourism, since it ignores the indirect
and induced effects of the industry. T&T investment is a
prime example of this phenomenon, since is not a com-
ponent of the direct economic impact of the industry
but is rather an important aspect of the broader indirect
impacts, as well as being critical in determining future
capacity and improving quality, competitiveness, produc-
tivity, and sustainability. For this reason, WTTC and
Oxford Economics will continue to track T&T invest-
ment across individual countries and regions, while
remaining consistent with the recommended TSA
framework.
In their chapter “Green Growth, Travelism, and the
Pursuit of Happiness,” Geoffrey Lipman from Beyond
Tourism and Shaun Vorster from the Ministry of
Tourism of South Africa discuss the important role to
be played by the T&T sector in the important shift
toward the green economy.
The authors describe how Travel & Tourism will
be an integral part of this process at global, regional, and
local levels, compatible with a low carbon development
trajectory, and will be a key sector driving the shift to a
green economy. Beyond compliance, this is also about
market leadership, consumer satisfaction, and competitive-
ness. Further, because of its multiplier effect that cascades
through interrelated value chains in the economy, a
green revolution in the T&T sector could be a catalyst
for green growth and transformation in the broader
economy.
However, they caution that in order to fully capital-
ize on its potential, the sector has to break out of its
historic inclination toward siloed goals, policies, and
institutional frameworks that in turn limit its value in
green growth decision making. Indeed, because of their
interconnectivity and mutual dependence, the T&T
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Executive Summary
The Travel & Tourism Competitiveness Report 2011 © 2011 World Economic Forum