The Canadian Tourism Commission operates in 12 countries around the world. Our global marketing and sales teams provide expert knowledge and support to the local travel trade, conduct media relations and promotional activities, launch consumer advertising and promotional campaigns, and maintain a strong presence at consumer and trade shows. We are a vital resource for the Canadian tourism industry in international markets.
Australia is Canada’s sixth-largest inbound market, boasting 219,400 arrivals in 2011. It is Canada’s second-largest market within the Asia-Pacific region, ahead of Japan but surpassed by China, which now tops the list.
The Australia economy expanded 3.3% in 2012. Although a slight slowdown to 2.3% is expected in 2013, unemployment and inflation are low and stable, while consumer spending should expand in line with GDP growth. Exports, which grew briskly in 2010 and 2011 on continued global demand for Australian raw materials, contracted 3.8% in 2012. A further contraction of 3.1% is forecast for 2013 before exports growth resumes in 2014.
From a currency standpoint, the Australian dollar appreciated slightly against major global currencies in 2012, rising 0.4% against the US dollar, 1.5% against the British pound and 1.4% against the Canadian dollar. This relative stability contrasts with the strong appreciations seen over the past decade—the AUD has risen 48% against the USD and 45% against the GBP since 2002. For 2013, the AUD is expected to depreciate 8.8% against the USD and 6.6% against the CAD, falling below parity in both countries as Australian interest rates fall on stabilizing inflation and speculative money exits the country.
Buoyed by a strong currency and a vibrant economy, outbound travel by Australians expanded 5.4% in 2012. Australian overnight trips to Canada increased 1.6%, with total spending growing 0.3% year-over-year. The strong value of the Australian dollar remains a key factor stimulating outbound travel.
According to Statistics Canada’s International Travel Survey (ITS), Australia boasts the second-highest per night spending by visitors in Canada after the US business travel market. In 2012, Australian travellers spent on average $1,791 per person-trip in Canada, with a typical trip length of 15.6 nights. The majority of Australians travelled for holiday purposes (62%) and to visit friends and relatives (25%).
Brazil has experienced rapid growth in flight availability during this past decade, which has led to a corresponding growth in outbound travel. In the past eight years, Brazilian travel beyond South America has grown 16.3% annually—from 1.7 million trips in 2004 to an estimated 5.6 million trips in 2012.
Brazil is now the seventh-largest economy in the world in terms of GDP and by far the largest in South America. During the global economic recession in 2009, Brazil’s GDP shrank just 0.2%, and this country was one of the first emerging markets to recover, with GDP expanding 7.5% in 2010. Despite Brazil’s economy rebounding towards the end of 2012, it posted GDP growth of just 1% for the year, well below expectations. While unemployment is expected to decline even further during 2013, high inflation continues to be a challenge.
The Brazilian real depreciated against all major currencies in 2012 and is expected to weaken further against the US dollar, which will improve the competitiveness of Brazil’s exports. The real is expected to remain stable against the Canadian dollar through 2014, providing a degree of price certainty for tourists planning trips, although those trips will be more expensive for Brazilians than in 2011.
In 2012, Canada welcomed 78,300 overnight visitors from Brazil, up 4.7% from 2011, with the majority (81%) being leisure travellers. These visitors spent $152 million in Canada’s tourism economy, an increase of 9.1% over 2011. Brazilians most interested in visiting Canada mainly live in Rio de Janeiro and São Paulo. Although Brazilian long-haul travellers do much of their trip planning and research online, more than half still book their trips through the travel trade. For more insights into Brazilian long-haul travellers, download the Brazil Consumer and Trade Research Summary Report.
As the world’s fastest-growing major economy and outbound tourism market, China navigated through the global economic crisis relatively unscathed. The Chinese economy expanded 7.5% in 2012, which marks a slight slowdown from the rapid expansions of 10.5% in 2010 and 9.3% in 2011. The pace of expansion is expected to quicken again to 8% in 2013 as the global recovery gets underway and is supported by strong growth in Chinese consumer spending (9.3%) and exports (10.2%).
Until 2005, China operated under a fixed exchange rate regime with a strict peg to the US dollar. This has evolved into a crawling peg that has allowed the CNY to slowly appreciate 23.8% against the USD since 2005, including 2.4% last year. The CNY is forecast to appreciate 1.7% against the USD in 2013 and 9.7% by 2016. In terms of the Canadian dollar, the CNY is expected to appreciate 3.7% in 2013 and 17.9% by 2016, improving the value perception of Canada as a trip destination.
Chinese appetite for outbound travel remains unabated: the World Tourism Organization is projecting that by 2020 China will have 100 million international travellers, the world’s fourth largest outbound tourism market.
With the granting of ADS (Approved Destination Status) in June 2010, overnight arrivals to Canada gained significant momentum, expanding 22.5% in 2011 and a further 15.5% in 2012 to 273,000 trips.Chinese travellers spent $486 million in Canada, up 19.2% compared with 2011, which made China Canada’s fourth most important tourism market.
France is Canada’s third-largest inbound market. In 2012, Canada welcomed 421,200 overnight French visitors who spent $530 million while in this country. Among French travellers, 45% indicated that their main purpose for visiting Canada was for holidays, while 36% visited Canada primarily to see friends and relatives.
The French economy is one of the largest in the world, having overtaken the UK in 2008 when the pound depreciated against the euro. Despite flat GDP growth of 0% and a relatively high unemployment rate of 9.9%, overall French outbound travel increased 1.1% in 2012. GDP growth is expected to remain flat through 2014 as the country deals with its government budget deficit and ongoing economic uncertainty in the Eurozone—providing limited support for any further expansion in outbound travel.
However, compared with competitive destinations, Canada is well positioned—it tops the list of places that comes to mind for French consumers for a long-haul holiday.
Germany, Europe’s largest (and the world’s fourth-largest) economy, was hit harder by the global economic crisis of 2008 and 2009 and the subsequent collapse in world trade than most other countries. Exports are more important to the German economy than they are for other major European economies, accounting for 40% of its GDP. In 2010 and early 2011, German growth rebounded quickly from the collapse in world trade as it reaped the benefits of past reforms and business investments to quickly meet demand for German exports. However, the onset of the Eurozone crisis led to growth pulling back over the second half of 2011 and into 2012. Growth decelerated to 0.9% in 2012 and is expected to remain subdued in 2013 before recovering in 2014.
Germans’ interest in long-haul travel is closely linked to the resilience of the German economy and international political stability. CTC’s latest Global Tourism Watch report suggests that the economic resurgence in 2010 and 2011 prompted a renewed interest in holiday travels to long-haul destinations. However, Germans cited personal reasons, potential conflicts or war, affordability and safety concerns as the top barriers to long-haul travel. Addressing these changing market conditions will aid in focusing Canada’s marketing resources most effectively.
In 2012, Canada welcomed 276,600 overnight visitors from Germany—down 4.7% from 2011—which represented $417 million in tourism receipts for Canada. Pleasure travel was the main trip purpose for 45% of German visitors.
According to the World Factbook published by the Central Intelligence Agency, India’s population of approximately 1.2 billion people is currently the second largest in the world. That figure is forecast to grow by 1.5% (18 million) per year to reach more than 1.6 billion by 2050. India’s emerging middle class is expected to surge tenfold, exceeding 500 million by 2025. The middle class will then command 60% of the country's spending power.
India is an attractive key market for Canada, thanks to sharing a common language (English), positive trade relationship and improving visa services, as well as India’s economic prosperity, rising income levels and affluent middle class.
India’s GDP growth slowed to 5% in 2012 due to concerns over persistently high inflation and interest rates combined with little progress on economic reforms.Total outbound Indian travel declined 0.4% in 2012, and Canada received fewer Indian visitors in the same proportion, with the number of arrivals falling to 162,000. However, total spending by Indian travellers in Canada expanded 6.4% to $173 million.
Japan boasts the world’s third-largest economy. Recent world economic events, the H1N1 flu pandemic of 2009 and a decrease in the popularity of long-haul travel have all contributed to a decline in Japanese travel to Canada. Given Japan’s emergence from the recent recession and domestic measures taken to encourage outbound travel, long-haul travel is expected to bounce back.
In the wake of Japan’s March 2011 natural disasters, the country’s massive rebuilding efforts set the stage for stronger-than-expected growth over the first half of 2012, with positive contributions coming from consumer spending and a robust export sector. However, Japan is still experiencing weakening growth in its main markets, in particular China and the Eurozone, which is expected to dampen future GDP expansion. Over the longer term, structural issues such as a shrinking working-age population, high debt and currency strength are expected to slow Japan down.
Canada welcomed 190,000 visitors from Japan in 2012, which represented $312 million of tourist spending. Among Japanese travellers in 2012, 42% indicated their main reason for travelling to Canada was for holiday purposes, while 27% indicated they travelled to see family and friends.
Despite steady drops in visitation in the past few years, Japan is still one of the highest-spending international travel markets for Canada and a continued focus for the CTC and this country’s tourism industry.
Mexico achieved moderate economic growth of 3.9% in 2012. Declining unemployment (4.9%) and improved consumer sentiment supported an increase in outbound travel (+5.5%).
In 2012, Mexicans made 131,600 overnight trips to Canada (+5.7%), which accounted for $194.7 million in tourism receipts, a 10% year-over-year increase.
Despite the implementation on Mexican travellers of visa restrictions in July 2009, Canada remains a destination of choice for experienced and high-frequency Mexican travellers. Indeed, after overnight visitation to Canada contracted 48% during the first year a visa was required, arrivals increased 6% in the subsequent period between August 2010 and July 2011 and a further 13% over the following 12 months to July 2012.
In 2012, 137,300 overnight visitors from South Korea generated $234 million in tourism spending in Canada, making this market Canada’s eighth largest source of overseas visitors and seventh-largest source of tourism receipts from overseas markets.
Bolstered by a buoyant economy, South Korea has emerged as a significant country for outbound tourism over the past decade, with Canada tapping into an increasing share. Exports accounted for 56% of South Korea’s GDP in 2012, making this country is particularly sensitive to the global trade cycle. Amid prevailing global uncertainties, momentum slowed in 2012, caused in part by the debt problem in the Eurozone and lower projected growth in China. GDP growth, which stood at 6.3% in 2010, declined to 3.7% in 2011 and 2% in 2012. A modest recovery to 2.2% growth is expected in 2013, with the pace of expansion quickening again in 2014.
The UK is Canada’s second-largest inbound market after the US. While it continues to be one of the most robust and dynamic travel markets in the world, the UK’s challenging economic situation has affected outbound long-haul travel.
The UK is a leading trading power and financial centre plus the third-largest economy in Europe after Germany and France. After a sustained economic expansion, the 2008 global financial crisis hit the UK’s economy particularly hard because of the importance of its financial sector. High consumer debt and sharply declining home prices compounded the UK’s economic problems, which prompted the government to implement a series of measures to stimulate the economy and stabilize the financial markets. However, faced with a spiralling budget deficit, the coalition government initiated a five-year austerity program in 2010 aimed at lowering the country’s deficit from over 10% of GDP in 2010 to 1% by 2015. Amid uncertainties in the Eurozone, GDP in 2012 is expected to contract by 0.2%, before gradually improving in 2013 as the situation in the Eurozone stabilizes.
Consumer confidence has also been weakened by ongoing uncertainty over job prospects, creeping inflations and VAT rates. As a result, British travellers cut back on outbound travel between 2007 and 2010, before edging up 2.3% in 2011.
In 2011, 622,700 overnight UK travellers visited Canada, down 5.8%. These visits represented $792 million in tourism receipts in Canada, a 2.4% contraction over 2010. Among UK overnight travellers to Canada, 77% come for holidays or to visit family or friends.
According to the US Department of Commerce’s Office of Travel and Tourism Industries, 37.8 million Americans travelled outside the US by air in 2012, up 4.8% compared with 2011. Of those travellers, 3.5 million travelled by air for overnight trips to Canada and represented nearly 30% of the 11.9 million US overnight visitors to Canada.
From 1996 to 2012, US leisure spending in Canada grew from $3.9 billion to $4.8 billion. That figure rises to $6.3 billion with the inclusion of the business travel sector.
In the wake of one of the most protracted and deep recessions on record, the US showed strong gains in 2010 as its economy expanded by 2.4%. However, cuts in government spending coupled with increases in food and fuel prices softened the US economy in 2011 as growth slowed to 1.7%, dimming the prospect of relief for millions of unemployed Americans. Amid a depreciating US dollar and growing public debt, the US economy is expected to remain sluggish in the near term as actions taken by the Federal Reserve gradually work to improve consumer confidence and consumption.
CTC’s latest Global Tourism Watch reports that international travel intentions in this market are up for the next three years, indicating a continued recovery in leisure-travel demand in 2013 and 2014. However, several factors could threaten that improvement, including rising gas prices, travel costs and inflation, as well as unfavourable exchange rates.
In 2012, over 52% of Americans travelling overnight to Canada came for a vacation, while another 25% visited family and friends. Although the business travel market represented a smaller number of travellers, they spent on average $242 per night in 2012, which exceeds the overnight spending of the US leisure market and CTC’s other key international markets.