Mixed year for Irish tourism industry

February 23rd, 2020 11:40 PM

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WHILE 2019 was a mixed year for tourism, there was a slight overall increase in overseas visitors to Ireland, up by 1.8% to 10,807,500, according to Central Statistics Office (CSO) figures.

The decade from 2010 to 2019 has seen a huge growth in visitor numbers, almost doubling from the 5.9m recorded for 10 years ago when numbers fell back to the pre-Celtic Tiger era levels of 1998. Whilst there was an increase in visitor numbers last year, indications are that the resultant revenue has decreased due to a shortened average length of stay and changes in the mix of visitors coming to Ireland.

During the economic boom of the first decade of the 21st century, Ireland priced itself out as an attractive destination for overseas visitors, especially for those in the lucrative UK market, and earned itself the unwanted ‘Rip-off Republic’ reputation.

The incoming Fine Gael-Labour Party coalition government kick-started the recovery back in July 2011 by introducing a package of measures to help providers of tourism products and services, the main thrust of which was the reduction in VAT applicable from 13.5% to 9%.

This, combined with – by necessity – more competitive hotel room rates and restaurant prices helped boost overseas visitor numbers year-on-year as the decade went on, boosted by a growth in ‘staycations’ as more Irish people availed of the better value provided by holidaying here, which was great for the domestic market too. However, as business improved, thanks also to imaginative initiatives like the Wild Atlantic Way, prices started to creep back up again, especially in Dublin, and having passed the magic 10m overseas visits mark, it became apparent to the government that the tourist industry could stand on its own two feet and it restored the VAT rate to 13.5% from the start of last year.

Despite the protests of the hospitality industry about the damage this would do, since the higher rate was restored visitor numbers increased again, albeit only slightly, in 2019. However, like the economy generally, the improvement in tourism’s fortunes has not been felt across all the regions, especially in areas like West Cork where the season is much shorter, illustrated by the closure of a number of high-profile restaurants locally in recent months, including one Michelin Star establishment.

The Irish Hotels Federation (IHF) was at pains to point out to politicians prior to the general election that the continued growth cannot be taken for granted. While the sector has created over 90,000 new jobs in the past decade and accounts for 260,000 jobs across the whole country, the industry faces many challenges, not least the inevitable further fall-out from Brexit this year.

IHF Cork chairman Neil Grant of the Celtic Ross Hotel in Rosscarbery warned that regional tourism is most likely to be negatively affected by any fall-off in growth and spending. There are 25,300 jobs depending on the industry in Cork city and county, and more supports for regional tourism would be welcomed in order to head off any further threats.

They also want the new government to tackle the high cost of doing business, provide increased tourism marketing support and make additional investment in tourism product and infrastructure as well as in people, skills and training.


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