MANAGUA – After a year of stagnant growth for Nicaragua’s tourism sector, business leaders are urging the government to invest more in the industry that has become the economy’s greatest source of income.
The government last year invested less than $1 million in the tourism industry, which is less than it spent in previous years and far less than any other country in Central America, according to Lucy Valenti, president of the private-sector National Tourism Chamber (CANATUR).
Valenti thinks the government should invest five times more than it is currently spending on tourism.
“I would like to see (the government) have a better understanding of the issues of promotion and the image of the country,” she told The Nica Times this week. “They need to invest more.”
Juan Ivan Bugna, president of the Small and Medium-Sized Business Chamber, claims that INTUR spent even less than it was supposed to last year. Bugna claims the government under-executed its 2007 budget by spending less than 60% of what it was allotted for the year.
“The money isn’t being spent,” said Bugna.
Others have also questioned INTUR’s promotional policies last year, claiming they don’t know where the money was spent or what the results were.
Still other tourism-business leaders wonder why the government seems to spend so much on promoting itself internally, rather than promoting the country as a tourism destination in markets where it matters.
“Everywhere you go you see those signs that say “El Pueblo Presidente,” said Alvaro Arana, manager of Tierra Tours in Granada, referring to Ortega’s self-promotional billboards that dot roadsides throughout the country. “A lot is being spent on those signs.
With that money we could promote more useful things, like tourism.”
Arana says that government funding would also be better spent on repairing road infrastructure, which will be another major challenge to the tourism industry this year, as many of the dusty and pothole-ridden roadways that connect the country’s favorite tourism destinations continued to deteriorate in 2007.
The three worst stretches of roadway used by tourists are the road between San Juandel Sur and La Virgen; Granada and Nandaime; and Masaya and Guanacaste.
Arana, as well as others in the tourism transportation industry, say that paving these roads should be the government’s “first investment” this year.
“Good roads bring tourists,” Arana said.
Same Budget in ‘08
INTUR Promotions Director Mariamanda Lacayo told The Nica Times that the government’s promotional budget this year is the same as it was last year. The government’s budget for tourism promotion has been the same for three years.
Lacayo said the ministry is planning to attend tourism fairs in Brazil and Mexico, and is looking at putting ads in popular U.S. publications. She deferred further questions about tourism promotion spending to Minister Mario Salinas.
The Nica Times last week tried several times to get an interview with Salinas to discuss the government’s tourism investment, but wasn’t able to locate him by press time.
In the past, Salinas has said that Ortega is committed to developing tourism.
“Undoubtedly, the government of President Ortega is clear about the important role that the tourism sector plays in generating money and jobs,” Salinas told The Nica Times in an interview in 2007.
Valenti says the government needs to show its commitment by investing in promotion.
Key advertisements in strategic tourist markets have shown to pay-off big, she said, and would help the industry recover its growth rate – which dropped from 8% to around 6% in 2007, during which an estimated 810,000 tourists visited Nicaragua, according to INTUR spokesman Jose David Barrera.
The government’s tourism-growth goals are for sustained double-digit growth.
Welcome Back, Mario
Looking ahead to this year, tourism leaders say they hope the return of Salinas will reestablish some stability to INTUR. Salinas, one of the country’s leading urban architects, started off 2007 as President Daniel Ortega’s head of INTUR, before leaving the tourism institute midway through the year for reasons that were not entirely clear. INTUR floundered for the rest of the year under unclear leadership, only to have Salinas renamed in December and promoted to the rank of minister – a move that was celebrated by the private sector.
“I am very glad that he’s back, because we already have a very good relationship and communication. He understands the industry’s problems,” Valenti said. “There was too much instability in INTUR last year.”
Yet even without clear leadership last year, the industry has continued to grow in certain areas, fueled by established private investment.
This year, several major projects are in the pipeline: The lavish Resort Marina Puesta del Sol, in Chinandega, is to begin a second phase of condos to add to the 600-hectare beach resort’s repertoire of 20 suites; golf legend Jack Nicklaus and the developers of The Seaside Mariana Spa & Golf Resort are scheduled to start work on the “Golden Bear’s” first signature golf course in Central America; and Grupo Pellas, headed by Nicaraguan tycoon Carlos Pellas, is breaking ground on its $350 million Marina Guacalita in Tola.
There also appears to be new interest in the Caribbean, a part of the country that Tierra Tour’s Arana says will be a growth region for next year.
Arana says his company is selling 50% more airplane tickets to the Caribbean than it was a year ago. He attributes the increase to a high-quality tourism niche that has been developed in the pristine Corn Islands.
The northwestern department of León, he said, is also positioned to draw a biggertourist crowd this year as visitors start to look beyond the country’s booming Southern and Central Pacific regions.