Euro Zone will Outperform USA

Berlin, 9/3/98 - The switch to a single currency in many nations of the European Union will have a positive impact on tourism by making prices more transparent and increasing competition, according to World Tourism Organization Secretary-General Francesco Frangialli.

"The euro represents a plus for European tourism, but not a revolution," Mr. Frangialli told reporters at a news conference held during the ITB tourism fair in Berlin.

The euro will allow tourism businesses—such as tour operators, hotel chains, and car rental companies—to operate in a broader market with more open and transparent pricing.

"The ability to compare prices more readily in European destinations will increase competition, both inside and outside the euro zone," said Mr. Frangialli, adding that increased competition should benefit travellers with lower prices and should ultimately strengthen the tourism industry.

"There is also the practical advantage for both travellers and trade of not having to change money when they travel to or do business with countries in the euro zone," he said.

If the countries making up the euro zone are considered as one nation, they constitute the number one destination in the world in all aspects of tourism, according to WTO research.

"The euro zone will be the number one force in the world tourism, outperforming its nearest competitor—the USA—in terms of tourist arrivals, tourism receipts and outbound trips," said Mr. Frangialli.

 

EURO ZONE vs. USA

Euro Zone USA

Population 288 million 255 million

GNP US$ 6.8 trillion US$ 7.5 trillion

Tourism Receipts US$ 72 billion US$ 64 billion

% world total 17% 16%

Tourist Arrivals 84 million 46 million

% world total 14% 7.7%

Tourism Balance US$ 13 million US$ 11 million

Outbound Trips 72 million 66 million

Source: World Tourism Organization, 1996 figures.

Euro Zone includes: Austria, Belgium, Finland, France, Germany, Ireland, Italy, Luxembourg, the Netherlands, Portugal, Spain.

Countries that are participating in the first phase of the euro will have a competitive advantage over those not participating, but those not included in the first round are not expected to face serious problems.

The World Tourism Organization is sponsoring a conference on the Effect of the Euro on May 3-8 in Greece to analyze the implications of the single currency for countries both inside and outside the euro zone.

Deborah Luhrman
(34 1) 567 81 00
World Tourism Organization