The U.S. travel slump can be Canada’s bump

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It’s not just Canadian tourists who are shunning the United States. Millions of international visitors – in particular, Germans, French and South Koreans – are avoiding travel to Donald Trump’s America, given the polarized political climate and increased border scrutiny. Canada’s tourism industry has benefited from a boost in domestic travellers, but more can be done to attract visitors.

With many tourism hot spots around the world experiencing disruptions, Canada’s reputation for safety and natural beauty is a huge advantage. The moment is right for tourism operators and government leaders to move aggressively to turn Canada into one of the world’s top travel destinations.

Tourism can be an engine of growth for Canada during these turbulent times. The federal government’s efforts to mitigate U.S. trade disruption have mainly focused on finding new markets for Canadian goods, such as energy, mining and agricultural commodities.

Canada to double non-U.S. exports over next decade, Carney says

There’s been much less attention given to services, and in particular tourism. Spending from foreign visitors in Canada is considered an export, as they exchange foreign currency to buy Canadian services. Prime Minister Mark Carney has vowed to double non-U.S. exports, generating an additional $300-billion by 2035. Indeed, in the third quarter, tourism real gross domestic product grew by 0.9 per cent, higher than the 0.6 per cent increase in overall GDP.

The numbers of non-resident visitors entering Canada are still below pre-pandemic times, in part because fewer Americans are visiting. Excluding U.S. visitors, however, overseas resident arrivals rose by 14 per cent in December compared with the same month a year earlier, with boosts in travellers from Europe, Asia and the Americas.

With Mr. Carney crisscrossing the globe trying to defrost relationships with China, India and other countries, more leisure travel could follow. For example, the Chinese government recently allowed the country’s group tour operators to resume travel to Canada following the Prime Minister’s meeting with President Xi Jinping.

China approves group tourism travel to Canada after Carney-Xi meeting

Canada’s safe reputation could have appeal for European travellers who would normally be drawn to the Caribbean and Mexico, given the food and fuel shortages in Cuba and cartel violence in Mexico. With war throughout the Middle East, Europeans might also think twice about destinations like Turkey and Dubai. While tourists fixated on only palm trees and white sand beaches won’t flock to Canada, for many, this country has great appeal.

In last year’s RepCor ranking of how G7 citizens perceive the world’s biggest economies, Canada reached the top spot (tied with Switzerland). Canada also does well in rankings of tourist destinations, due to its natural attractions, safety and reputation. Wayne Smith, director of Toronto Metropolitan University’s Institute for Hospitality and Tourism Research, says Canada is seen as “America’s ethical little brother.”

Government leaders and tourism operators should seek to diversify our tourism markets, but they shouldn’t give up on the U.S. One recent partnership between the federal Crown corporation responsible for tourism, Destination Canada, and the restaurant reservation site OpenTable, invited Americans to dine with local households, a gesture meant to show that U.S. visitors are still welcome here.

With the FIFA World Cup putting Canada in the spotlight this year, it’s a good moment for tourism operators to invest in building new markets through trade shows, ad campaigns and partnerships. Indigenous tourism, in particular, has huge promise; a survey showed one in three international visitors wants to participate in Indigenous experiences.

The chill on entering the U.S. could also give Canada a chance to boost its conference business, which is important as it shifts travel into spring and fall rather than the busy summer season. Business travellers also tend to spend more money. A federal fund that was used to attract conferences to Canada, the International Convention Attraction Fund, was cut in the last budget, but it might be worth another look if its returns prove worthwhile.

A bigger tourism industry could have a knock-on effect in boosting trade, and help turn Canada’s airports into global hubs. Making Canada into an international crossroads, and bringing travellers from Europe, Asia and the Americas to experience gems such as Lake Louise, Niagara Falls and Quebec City, could be key to the country’s economic future.

America’s travel slump can be Canada’s economic bump.