A development strategy similar to that outlined for industry in the Culliton Report in 1992 is required for the tourism sector, the Irish Tourism Industry Confederation (ITIC) said yesterday.
With tourist numbers down this year and last, compared to the high figures of 2000, growth in the sector has stalled and there is "no guarantee" of a revival, according to the ITIC.
The ITIC called on the Government to prepare a new strategy on tourism development to be completed within seven months.
The number of out-of-State tourists fell from 6.7 million in 2000 to 6.4 million last year. "The year 2000 may prove to be a watershed in terms of overseas visitor numbers," according to the report, The Impact of Tourism on the Irish Economy, which was presented to the Government yesterday.
"Early indications for 2002 suggest it will be another difficult year for tourism."
The report states that €6 out of every €100 of consumer spending in recent years has come from overseas visitors. Tourism accounts for 8 per cent of overall employment in the State. It is mainly run by small indigenous companies and it is one of the few sectors offering genuine prospects for commercial regional development, according to the report.
However, the sector has suffered a "deep deterioration in price competitiveness since 2000", according to the report.
This is because: domestic inflation has accelerated sharply; Irish inflation has, since 1999, outstripped prices in competing markets and in those countries from which Ireland seeks to attract visitors; and the dollar and sterling exchange rates are no longer sheltering Ireland from its high inflation rate.
The report states that in the period November 1996 to June 2002, food and non-alcoholic drinks increased in price by 24.4 per cent. Other price increases for the same period were: alcoholic drinks and tobacco, 33.5 per cent; recreation and culture, 21.8 per cent; and restaurants and hotels, 32.3 per cent.
The report argues that cumulative inflation in the Republic since the late 1990s has been faster than in any EU competitor destination other than Greece. "More importantly, average prices have been rising considerably faster in Ireland than in the principal markets from which we aspire to attract overseas visitors."
The chairman of the confederation, Mr Tony Kelly, said the €35,000 report was important because it was a major study based on official statistics which forcefully made the point as to the importance of the tourism sector to the overall economy.
"The value of tourism is not fully understood and we wanted to press home what tourism has done for this country in the last 10 years."
He said the tourism sector itself was not responsible for the high prices which may be dissuading tourists from visiting Ireland. He said the Irish tourism sector competed against other possible tourism locations but had to cope with domestic Irish inflation.
"Tourism operators are not putting up prices. The cost base is growing, the numbers are down, business is static. No-one is making a fortune." Mr Kelly said the indications were that the number of overseas visitors for 2002 would be lower than last year.
The Minister for Arts, Sports and Tourism, Mr O'Donoghue, welcomed the report and said it was timely given the Government's intention to establish a National Tourism Development Authority. The authority will merge the functions currently carried out by Bord Fáilte and CERT.
