It remains this island’s leading market for tourists, with officials reporting a ten per cent rise in arrivals during the first quarter of this year, making for 24 consecutive months of boom or 71,263 stay over arrivals out of the United Kingdom.
However, as the result of last week’s UK referendum on membership in the European Union continues to sink in, there are growing fears of the impact on this island’s bread and butter tourism industry, even as Acting Prime Minister and Minister of Tourism Richard Sealy seeks to be the voice of calm in the midst of the global upheaval.
Today, he sought to allay concerns that Britain’s pending exit from the EU, based on last week’s vote to leave, commonly referred to as the “Brexit” vote, might lead to “fallout” in terms of tourist arrivals from that territory.
Speaking to reporters after a short tour of the Sam Lord’s Castle site, where demolition has officially started to make way for a new Wyndham Grand Hotel, Sealy suggested that the vote would not affect the island’s tourism.
In reference to the fact that the UK was Barbados’ biggest source market, he said, “That is the case now, it was the case last week, and it will be the case next week, whether they are part of the EU or not”.
He however acknowledged that the tourism industry was sensitive to currency values, pointing out that the pound sterling had always been a “fickle currency”, as it fluctuated quite often.
“These issues are not necessarily new. To be frank I am just happy that some sense of closure has been brought to this issue of whether they’re in or out. And, the truth is that Barbados has to do what we have to do. The brand is extremely strong in the UK and that is not going to change, and we have to continue to work hard,” the Minister of Tourism underscored.
His response was in sharp contrast to that of the President of the Barbados Chamber of Commerce and Industry (BCCI) Eddie Abed, who today warned of the need for Barbados to seek to safeguard its vital tourism industry, following last week’s referendum which garnered 51.89 per cent support from the Leave campaigners compared to 48.11 per cent support for Remain supporters.
Like Sealy, the businessman also made reference to the effect of Brexit on the sterling, but that was where their agreement ended.
“To be forewarned is to fore plan. And that really is what we need to do because we have absolutely no ability to influence the outcome whether in the short-term or medium-term,” Abed told Barbados TODAY, while warning the current uncertainty in Britain could not only affect tourism spending out of the UK, but also dampen travel from that market.
“A British visitor may be so uncertain about what his future holds that he may decide to put off his holiday for this year. These are the bigger questions we need to ask ourselves. So I would say definitely we need to fore plan and we need to try to cater to that individual and understand the uncertainty that they are currently going through,” he cautioned.
The Chamber president said the private sector grouping had not yet met formally to discuss the matter, but the information presented to date pointed to a level of political and economic instability in Barbados’ number one source market for tourists, which should not be taken lightly by officials here, as it had the potential to spill over to other European nations.
“We are concerned as businesspeople because we know that our main industry that seem to have been buoyant in the last few months – definitely for last year and into the winter tourist season this year – has been tourism, which was bolstered by a large part from the UK market. And anything that may affect that concerns the wider business community,” said Abed.
“The currency in the last two working days has been devalued by about 15 per cent, which means that the British have 15 per cent less spending power today than they did two working days ago. And of course they will be looking for maximum bang for their buck, and because our currency is tied to the US dollar, sadly that is not going to give them the best bang for the buck,” he added.
United States and European stock markets stumbled again Monday as investors grappled with the fallout from Britain’s historic vote to leave the EU.
In the US, the Dow Jones industrial average and Standard & Poor’s 500-stock index fell more than two per cent before recovering some ground. The tech-heavy Nasdaq fell 2.4 per cent. London’s main FTSE 100 index was off 2.6 per cent and Germany’s DAX more than three per cent.
Those losses followed dramatic sell-offs Friday, when the news of Britain’s pending exit from the economic and political bloc rocked global markets, which have lost more than US$3 trillion in value since then, according to international analysts.
Adding to investor concerns on Monday, S&P Global Ratings lowered its credit rating for Britain to “AA” from “AAA” and said that “the outlook on the long-term rating is negative.”
However, Sealy is adamant that there is no need to worry at this stage about the apparent fallout.
On the issue of diversifying Barbados’ source market base, he said it had always been Government’s position to look for visitors from all around the world, while at the same time shoring up our existing source markets.
“So that is where we really are and it is something over which we do not have any control. And we simply have to continue doing what we were doing over the years,” he told reporters.
The new 450-room hotel at Sam Lord’s Castle, now owned by American company Wyndham Hotels & Resorts, will cost approximately US$200 million to complete. It is to be completed over the next two years.