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 The Brancatelli File

joe THE 1998 OUTLOOK
FOR OVERSEAS LEISURE TRAVEL


BY JOE BRANCATELLI

January 6, 1998 -- War in all its forms--social, economic, and military--will go a long way in shaping where Americans will travel in 1998.

In places where Americans are winning the economic wars--the dollar is gaining dramatically in value against most European and Asian currencies--it is clear that we will visit in record numbers. But Americans react viscerally whenever there is a hint of increased social or military upheaval. Tourism to Egypt and the Middle East, for example, has plummeted since the Luxor massacre last fall. A rising crime rate in Johannesburg has led South Africa's best hotel to all but close its doors. And nascent tourism industries in such places as Northern Ireland and Eastern Africa have been severely depressed by continued qualms about safety.

Here is a region by region look at what to expect in the world of overseas travel this year.

AFRICA As you can see by the chart below, Africa has experienced the greatest percentage growth in U.S. visitors between 1992 and 1996. But the statistics are misleading because so few Americans get to Africa at all. In fact, for every U.S. traveler flying to Africa, almost 70 others fly to Europe.

That ratio is unlikely to change this year. For starters, no U.S. carrier currently offers direct flights to any destination in sub-Saharan Africa. And, by U.S. standards, the news from Africa appears unremittingly bad. After an immediate upswing in American visitors when South Africans elected Nelson Mandela as president, an unprecedented increase in urban crime led U.S. travelers to brand South Africa a dangerous destination. Ethnic and social violence in countries such as Rwanda, Burundi and Congo (formerly Zaire) further eroded Africa's image. And the continent's traditional tourist draw--the game safari--has lost much of its appeal after last summer's political uprisings in Kenya, Africa's most popular safari destination.

ASIA If money talks, the U.S. dollar is screaming at the top of its metaphoric lungs all over Southeast Asia. In mid-January, the dollar bought 235 percent more in Indonesia than it did last June. In Thailand, the dollar bought 125 percent more. The increase in the dollar's buying power was almost as dramatic in Korea (104 percent), Malaysia (84 percent) and the Philippines (68 percent).

Such unprecedented gains have tour operators scrambling to lower their prices for air and land packages. In fact, most 1998 brochure prices are already irrelevant, so shoppers are likely to find the cost of travel bundles to be substantially lower than the published prices. Expect the cheapest packages to Thailand and nearby nations to sell for about $1,000 for seven-night stays.

Elsewhere in Asia, the stunning decline in the number of visitors to Hong Kong since its reversion to Chinese suzerainty last year has nervous hoteliers and tour operators slashing prices. A recent eye-popping promotion from Cathay Pacific offering a week in Hong Kong for two for just $995 is unlikely to be repeated, but Northwest Airlines recently announced three-night air and hotel deals starting at $629 a person.

EUROPE Bargains will be almost everywhere in Europe in 1998. The run-up in the value of the dollar last year against European currencies is reflected in the prices for packages this year. Globus, a huge escorted-tour operator, pared as much as $330 from the price of some European packages this year. KD River Cruises reduced the fares on many of its cruises on the Rhine, the Danube and in Central and Eastern Europe. Tour operator Insight didn't lower prices; it bundled once-optional excursions into the standard offerings on 47 of its 48 packages.

Eastern European countries emerging from years of communist rule learned some humbling economic lessons last year, but travel prices remain high when compared to most Western nations. That's because accommodations acceptable to American tourists are hard to come by and expensive when they are available.

The bad news? The British and Irish pounds have gained value faster than the U.S. dollar, so visiting Britain and Ireland will be even more expensive than it has been in recent years. Tourism has flagged in Northern Ireland as peace talks have lagged and the strife-torn former Yugoslav republics remain largely off the U.S. traveler's radar.

MIDDLE EAST The peace process has once again ground to a halt in the Middle East--and so has tourism. Terrorist attacks throughout the region have soured most Americans on a visit to Israel, Egypt or anywhere else. Bargain hunters will find excellent value for money if they can overcome their fears.

OCEANIA Australia, New Zealand and the other Pacific islands continue to rank high on Americans' "must-visit" list, but comparatively few travelers actually make the long trek. Many may be waiting for the 2000 Summer Olympics in Sydney, but prices and conditions will undoubtedly be more amenable this year. Going now would be advisable. You can always watch the Olympics on television.

WHERE WE'VE FLOWN IN THE NINETIES

REGION

1992

1996

GROWTH

Africa

262,997

530,671

101.8%

Middle East

583,301

1,116,572

91.4%

South Africa

4,825,693

7,232,747

49.9%

Far East

15,491,673

21,682,548

40.0%

Europe

30,305,416

37,442,429

23.6%

Canada

12,901,248

15,392,534

19.3%

Caribbean

9,833,747

11,658,405

18.6%

Central America

13,221,012

15,501,849

17.3%

Oceana

2,449,429

2,713,047

10.8%

Number of nonstop airline passengers flying between the United States and the region listed.
Source: GKMB Consulting Services


This column originally appeared in the Frommer's Travel Update newsletter.

Copyright 1993-2004 by Joe Brancatelli. All rights reserved.