UN says people will travel despite global credit crunch

Tourist arrivals around the world are expected to slow this year due to high fuel prices, a UN official said yesterday, but he said he was confident the tourism sector was not overly vulnerable to the global credit crunch.

Francesco Frangialli, secretary-general of the UN World Tourism Organisation (WTO), said the financial crisis could cut down on travel and leisure spending but people across the globe were still travelling.

"We are worried, of course," Mr Frangialli told delegates of the United Federation of Travel Agents' Associations.

"But, we are not giving in to panic. Experience teaches us that tourism is resilient. The need to go on trips, to take holidays, is too strong in our post-industrial societies."

He said the prospect of a deep recession in the US and Western Europe had started changing consumer behaviour, although it had not stopped travel.

The crisis, he said, was likely to have less of an effect than the spread of Severe Acute Respiratory Syndrome in 2003, when travel fell off sharply, especially in Asia.

"American and European consumers have been spending less in their destinations," Mr Frangialli said, reducing incidental expenditures, such as restaurants, entertainment and transport options.

"This has led to the popularity of staying with relatives and friends, at camping sites, mobile homes and social tourist accommodations."

While low-cost airlines suffered during the first half of this year due to high prices of fuel, Mr Frangialli said many travellers were now using budget carriers.

He said about 900 million people travelled last year and this number was expected to hit 1.1 billion in 2010, growing slowly from the six per cent rise in tourism traffic last year.

In the Philippines, the head of the travel agencies association said the impact of the financial problems in the US would likely be felt in the first quarter of next year.