Tourism Growth Stagnates
After Costa Rica s tourism growth nearly ground to a halt in 2006, leaders now say they re less concerned with posting high numbers and more interested in improving tourism quality in Costa Rica.
Industry leaders are heading to the drawing board to slap together a new marketing strategy for 2007. And though some disagree on the causes of a ho-hum year for tourism, all tend to agree it s time for the industry to turn over a new leaf.
In order to continue attracting tourists who last year alone spent an amount equal to 8% of Costa Rica s $22 billion gross domestic product the sector must deal with issues that have haunted it for years, such as deteriorated infrastructure and public safety, said Tourism Minister Carlos Benavides.
Improving quality to attract tourists is more important than growth for the mere sake of growth, Benavides told The Tico Times.
Benavides has estimated the country will post the same number of tourists in 2006 as it did in 2005 nearly 1.7 million. That means tourism growth in Costa Rica came to a screeching stop this year, after booming growth of 17.3% in 2004 and 15.6% in 2005.
Data from the Costa Rican Tourism Institute (ICT) from January through August of last year the latest numbers available show tourism having grown a mere 1% compared to the same period in 2005.
The stat isn t official yet, but tourism didn t grow last year, said William Rodríguez, vice-president of the National Tourism Chamber (CANATUR). The problem is that prices are rising faster than quality in Costa Rica, he told The Tico Times Tuesday.
If changes are made, Tourism Minister Benavides said, he believes tourism could grow 6% this year. He pointed to the need to develop a sustainable tourism industry by strengthening the country s weaknesses. Roads, highways, airports, also security vigilance in spots of tourism interest in past years has not been the best, he admitted, adding that the uneven distribution of wealth in Costa Rica (TT, Jan. 5) is also a detrimental factor.
Soon after the 36-year-old, smooth-talking minister was appointed by President Oscar Arias last year, he warned that tourism growth wouldn t continue without these changes (TT,May 19, 2006). Mauricio Céspedes, executive director of the Guanacaste Chamber of Tourism (CATURGUA), agreed with Benavides that improving services for tourists is more important than simply aiming to increase the numbers.
Tourism in the northwestern province increased by 7% this year compared to 2005, with 350,000 foreign visitors arriving at DanielOduberInternationalAirport in the provincial capital of Liberia. Céspedes pointed out that this figure doesn t reflect the number of national tourists who visit the province or those who arrive by land.
By next year, Céspedes said he expects tourism in Guanacaste to increase by 10%. He said one of his main concerns this year is ensuring that tourists who leave recommend Guanacaste as a destination to their friends and families. Tourists who have filled out exit surveys at Daniel Oduber have indicated infrastructure deficiencies are a major problem during their visit an issue Guanacaste needs to tackle, he said.
He hopes to work hand in hand with the Public Works and Transport Ministry (MOPT) and the Environment and Energy Ministry (MINAE) on infrastructure projects such as road repairs this year.
The new administration entered with a lot of interest and a disposition to develop projects in Guanacaste, he said, referring to the administration of President Oscar Arias, which took office in May last year.
However, other worries remain on the executive director s mind. Céspedes explained that with so many resort projects being developed in Guanacaste, the question is, will there be enough tourists to fill them? We are no longer experiencing the tourism explosion we did before, he said, explaining that in 2002-2003, the years immediately after the Sept. 11, 2001, attacks in the United States, arrivals at Daniel Oduber increased by as much as 87%. Costa Rica was considered a safe travel destination at a time when many were wary of air travel because of the airplane attacks on the WorldTradeCenter and Pentagon, he said.
Members of the tourism sector worldwide speculate that in years when there is a World Cup soccer event, as there was last year in Germany, tourism plummets around the world. This could explain why tourism growth last year was not as explosive as in 2002 or 2003, he said.
Also, Costa Rica now has to compete with the sleeping tourism giant that is Panama, a country directly south with much better infrastructure, he said. Tourism is also growing in neighboring Nicaragua, to the north, in part thanks to positive international press touting the country as a great new destination (see article in The Nica Times).
But Rodríguez said Costa Rica is a mature product that attracts a different type of buyer than its neighbors, so Nicaragua and Panama aren t really direct competitors. The tourism industry in Costa Rica has been growing for a decade, he said.
However, he added, it is telling that by early January the Nicaraguan Tourism Institute has already published its complete tourism stats for 2006, while the Costa Rican Tourism Institute says it is twiddling its thumbs while Immigration officials tally the exact number of last year s arrivals.
Rodríguez said these figures normally aren t released in Costa Rica until around March. On the country s Caribbean coast, hotel owners such as Canadian Terry Newton, owner of the Magellan Inn for almost 15 years in the beach town of Cahuita, celebrated new flights coming into the Caribbean port city of Limón as a sign of a brighter future for tourism in that region.
There is more tourism and many new hotels in Cahuita. I think with daily flights coming into Limón things will change like they did in Liberia, she told The Tico Times. All agreed security has become a problem for tourists in Costa Rica. The Arias administration has begun to respond to concerns by deploying the first of its new tourism police force in December (TT, Dec. 22, 2006).
President Arias, Minister Benavides and Public Security Minister Fernando Berrocal attended the late December graduation of the first 122 tourism police officers, in attempts to salvage Costa Rica s reputation as a safe destination a reputation that sometimes appears to be at risk.
Just this week, for example, news circulated throughout Canada and abroad about a couple from Mississauga, Ontario, that was attacked at knifepoint and stabbed on the beach in the Pacific port city of Puntarenas during their Christmas vacation here.
Thieves made off with a gold necklace, and both the man and his wife required treatment at a local hospital.
The man, Ukraine transplant Myroslav Chuyko, told the Missassauga News his family went to Costa Rica to get away, not to be killed.
Rodríguez told The Tico Times he wasn t familiar with the case but acknowledged a crime surge in Costa Rica affects tourists. However, he pointed out that in the exit surveys tourists fill out at airports, 82% indicated they feel Costa Rica is a safe country.
But there s no doubt that if the crime persists as is, it will become problematic for tourism, he said.
Two of the new tourism police headquarters will be located in Papagayo and near the Liberia airport, both in the northwest province of Guanacaste, where tourists increasingly became targets for robbers this year.
Benavides also said the country will have to try to find new ways to bring in European tourists after the hit the industry took when the Spanish airline Air Madrid, which brought nearly 30,000 tourists a year to Costa Rica, closed up shop late last year (TT, Dec. 22, 2006).
This week, German airline LTU held talks with the Spanish government to restart flights to Costa Rica and Latin America that were canceled when Air Madrid shut down.
Benavides said attracting more flights from Europe and the United States the latter accounts for 42% of tourists in Costa Rica is a top priority for the ICT in 2007. Rodríguez called the minister s quest to attract more flights simplistic.
If the airlines aren t offering as many seats it s because the demand isn t there, said the former manager of United Airlines in Costa Rica.
Carlos Lizama, president of the Costa Rican Association of Tourism Professionals (ACOPROT), said that to pull the tourism industry s growth rate out of its slump, the industry will have to revamp its marketing strategy and seek new markets. He sees a great potential for growth in attracting conferences and fairs to Costa Rica.
But we have to make a bigger push in the public and private sectors for better facilities we don t even have a convention center, he said.
The country s tourism industry should also tap into the potential of health tourism, as well as try to attract more senior citizens and people with disabilities, Lizama said, adding there is a huge market for people who come to Costa Rica for the health benefits of its climate, and for the inexpensive cost of medical treatments.
Educational tourism in which foreigners come to Costa Rica for longer stays to study Spanish or other subjects has bright prospects for the industry in 2007 as well, he said.
Tico Times reporter María Gabriela Díaz contributed to this story.
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