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Tourism 'bullish' amid recession

23 April 09 10:01 GMT

Scotland's tourism boss has said the industry remains "confident and bullish" despite a drop of around 30% in corporate tourism business.

VisitScotland chief executive, Philip Riddle said, conversely the recession was also prompting more people from the UK to holiday in Scotland.

But he added the proportion of overseas visitors has fallen by up to 10%.

Mr Riddle said the decline had hit Scotland's cities hardest, but rural areas have been faring better.

Over 250 tourism firms have been exhibiting to buyers from across the world at the VisitScotland Expo trade fair in Glasgow.

Mr Riddle said business tourism had suffered a "significant decline" of about 30%, but that an improvement was anticipated by the end of 2009.

He said: "Looking at the market generally it's quite clear that corporate business is suffering. It's not just businesses cutting back, which of course is a feature everywhere.

"There's also cultural intimidation - businesses are feeling they should not be seen to be doing things like hosting meetings for buyers or having incentive trips.

"So we've got to get out of that way of thinking. These things are good for business, not all jollies for overpaid executives."

Lee Derrick, executive board member of Golf Tourism Scotland, agreed: "Corporate groups have been down.

"People are more likely now to spend their own money because it's hard for a company to justify spending large sums at the moment."

Jamie Hastings, a business development manager with Malmaison hotel in Aberdeen, said some corporate demand had been sustained despite "cost-consciousness".

"A lot of business for our English hotels comes from financial services companies in the major cities affected by the recession. But in Aberdeen we rely on the oil and gas industry - they will pay a premium for rooms during the week, and it's consistent business."

Mr Riddle said the decline had hit Scotland's cities hardest, but rural areas offering outdoor activities were faring better.

VisitScotland has launched a new "Perfect Day" campaign to highlight Scotland's potential for leisure and activity holidays, offering a challenge to the popular North of England market.

Nicol Manson, director of Highlands Loch Ness tourism group, described business in Inverness as "buoyant" in the face of economic gloom.

But he believed a delayed impact might be seen in the city, based on its response to previous downturns.

He added: "The home market is showing a lot more interest than usual, not so much because of the cost of getting to Europe but the cost of being there."

Scottish value

Mr Riddle confirmed the strength of the euro and relative weakness of the pound was attracting more European visitors - particularly from France, Germany, Spain and Italy - and keeping more British holidaymakers in the UK.

"We have tremendous competitivity due to the exchange rate - it's never been better value to be in Scotland than it is just now."

But he noted a "reluctance" for recession travel among Americans, traditionally Scotland's biggest overseas market.

Mr Riddle said: "In the first part of the decade, we increased our international business quite significantly to 25-30% of our total value.

"I wouldn't be surprised if we now go back to nearer 80% domestic, 20% overseas, which is where we were traditionally."

Audrey Kelly, general manager of the Kenmore Hotel in Perthshire, said this shift was reflected in the make-up of her clientele.

"Whereas before we had about 30% domestic and 70% international business, it's shifted to 60% domestic and 40% international this year, most notably over Easter."

Hoteliers exhibiting at the event admitted they had discounted room rates in order to secure business as customers tried to economise.

And in this uncertain financial climate, Scotland's hostels have been seeing benefits.

Louise Nowell, head of sales and marketing at the Scottish Youth Hostels Association, said: "Our advance bookings are up 7% compared to the same time last year.

"In an ordinary year I wouldn't have expected the figures to go up as they have. There's a reason for it - the economic situation.

"The exchange rate is keeping Brits at home, foreign visitors are getting more value for money, and people are becoming more value-conscious due to the credit crunch. Suddenly we're being seen as an affordable destination."

Bright future

About 800 buyers are attending the trade fair in Glasgow, with representatives from Iran, Serbia, Pakistan and Turkey among those attending for the first time.

Mr Riddle said new markets, particularly in Asia, represented "the future" for Scotland's tourism. And though China is often thought to present the greatest potential, he believed India could be even more important.

Mr Derrick, of Golf Tourism Scotland, felt Scotland would see more Chinese visitors in the future. "But they're talking about a million Chinese golfers - I think that's a long way off."

Meanwhile, Indian buyers at the fair said many Indians could afford and would want to visit Scotland for its culture, history and reputation for a warm welcome.

They were impressed by the Homecoming Scotland initiative, which is encouraging tourists to explore their heritage in Scotland during 2009.

Mr Riddle said the concept provided a focus for the industry during the recession.

"It's not going to transform tourism overnight, it's not going to transform the Scottish economy, but it will make a vital contribution at a particularly important time.

"And it carries a very strong message about Scotland - that Scotland's not only open for business, but there's a lot happening here."

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