Published on Thursday, January 26, 2017
President Trump pushing forward with 'America First' creates a number of impacts for global tourism
President Trump has covered a number of areas in his various messages before and now during his presidency. Almost all of them will affect global tourism. From a global perspective they are consistently negative, however there are serious opportunities.
The Trump policy falls broadly into the following areas:
Import taxation: President Trump has promised to levy substantial taxes (35% plus is quoted for instance) on all imports. This is to be keep as much production and employment in the US as possible. It is unlikely that affected will not reciprocate - both in terms of tariffs and propaganda.
Anti China, Mexico, European Union policies: President Trump sees these all as net destroyers of US jobs - manufacturing quality products more cheaply, more effectively than they can in the USA. His taxes will stop a large amount of imports, but he is also engaging in a war of words and maybe in the future in diplomacy.
Globalisation: President Trump has been supported by a substantial anti-globalisation faction and his first action was to scrap the Trans Pacific Partnership, the Transatlantic Trade and Investment Partnership with the EU appears dead in the water. The NAFTA agreement with North American countries including Canada and Mexico now looks shaky.
It is clear that to a large extent globalization has ameliorated global poverty - largely by transferring jobs and wealth to poorer countries.
However US-based global brands have also benefitted - particularly in the leisure industry, take for instance Starbucks (now the biggest global restaurant chain), Macdonalds, Marriott, Hilton, Best Western, Raddisson, Hyatt, Wyndham, Coca Cola, plus commodities such as GMO seeds.
Security: Apart from the construction of the Trump Wall between the US and Mexico, it is likely that US Immigration security checks will increase - and that security throughout America will be at an enhanced level.
Climate Change: President Trump is one of the world's great climate-change deniers tweeting in 2012 that climate change was a Chinese hoax. Actions, though speak louder than words. The White House climate change page was removed on Trump's first day in office, there is now a commitment to eliminate "harmful and unnecessary policies such as the Climate Action Plan" (President Obama's broad-based strategy to cut carbon emissions).
So how is all this going to affect global tourism?
The immediate effect will be a reduction in tourism to the US. Millions will either not go or not be able to go to the USA as a result of more stringent immigration procedures. It is, however, likely that the figures will be artificially bolstered by a Trump-style news campaign.
It is also likely that affected countries (in particular key members of the EU like France, Italy and Germany all facing elections) will pursue anti-American policies and issue negative statements in tit-for-tat campaigns to galvanise popularity, bolster their own solidarity, pride and negotiating terms. This could see not only a reduction in tourism to the US but also a 'blacking' and reduction of business for global US hotel and restaurant brands.
Finally -there is the issue of the EUETS (The European Union Emission Trading Scheme). Currently this applies only to EU based airlines, flying on European routes. In 2013 the EU was to apply the scheme also to international carriers flying in and out of EU airports.
As a result of a mass outcry (principally from the US and China) the extension was halted so that ICAO (International Civil Aviation Organisation) could come up with a strong global scheme in 2016 - they haven't. The extension is up for review in 2017. Given an anti-USA EU it is very likely that the EUETS will rise again and fulfil its original intention to capture ALL flights through the EU. Watch this space.
Given that the EU and China are already leaders in renewable energy, sustainability and climate-change initiatives (including sustainable transportation) another 4 or 8 years of a Trump presidency may form an impossible gap to make up.
All of this aggressive activity gives easy non-hassle access harmonious sustainable destinations outside of the US a real opportunity to prove their worth - even in Mexico!
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The recent insolvency of Low Cost Travel Group, one of the large players in the travel industry had a big impact on the travelers, hotels and all related players from both wholesale & retail arms. There were about 27,000 people on a holiday who had booked through the company comprised of a €200 million wholesale arm and €500 million OTA / retail arm.