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(Updates with Euromonitor data from sixth paragraph.)
Nov. 7 (Bloomberg) -- The global travel and tourism industry may expand slower than previously forecast this year and in 2012 as economic conditions in Europe deteriorate, according to the World Travel & Tourism Council.
“Sitting in the middle of the euro zone, the picture doesn’t look good, the outbound market is suffering, governments are raising taxes and cutting back and people have less disposable income for travel and tourism,” David Scowsill, president of the council, said in a phone interview. “Most of the growth is happening in Asia.”
The $6 trillion travel and tourism industry will grow 3.2 percent this year and 3.3 percent next year, Scowsill said. That’s lower than forecasts of 4.5 percent for 2011 and 5.1 percent for 2012 made in March by the council, whose members include executives from 100 companies.
Millennium & Copthorne Hotels Plc, which owns, manages or operates more than 100 hotels worldwide, said Nov. 4 that the euro zone’s difficulties are affecting its clients. Similar conditions may weigh on results of InterContinental Hotels Group Plc, which reports earnings Nov. 8, and Whitbread Plc, owner of the Premier Inn budget-hotel chain, Nigel Hicks, an analyst at Liberum Capital, wrote in a note.
European Central Bank President Mario Draghi said Nov. 3 the 17-nation euro currency area may enter a “mild” recession.
The crisis in Europe is driving a “a huge shift towards Asia,” said Scowsill, noting that Asia’s travel market is growing at about 9 percent annually compared with about 2 percent for western Europe. The industry will see the addition of 2 billion middle-class consumers by 2030, three-quarters of whom will be from India and China, he said.
Incoming tourist-receipt growth may slow next year to about 3 percent from about 5 percent in 2011, according to Euromonitor International data prepared for the World Travel Market event that starts in London today. Rising fuel and commodity prices, higher taxes, austerity measures and political protests in the Middle East will affect global arrivals, the researcher said.
Chinese spending on travel accommodation may rise 20 percent to $67 billion between 2010 and 2015, which would make them the second highest spenders after the U.S., according to Euromonitor.
Hotel companies including InterContinental and Accor SA are introducing new brands in China and adapting their offer internationally to attract Asian tourists.
--Editors: Jerrold Colten, Thomas Mulier
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