The world is having to adjust to the “new normal”, an uncertain existence surrounded by regular and impactful geopolitical shifts, delegates at a recent luxury travel conference were told.
Daniel Franklin, executive editor of The Economist and its annual The World in… report, said the travel industry needed to think about how this new way of existence affects how they do business.
Speaking at the Ultratravel Forum in partnership with ttgluxury held at The Savoy in London, he highlighted several events that could have a big impact on tourism this year, such as the ongoing refugee crisis.
The coming months were likely to see more people – many from sub-Saharan Africa - attempt to cross the Mediterranean from the coasts of Libya and Egypt to enter Europe via Italy, he said.
The possibility of Donald Trump becoming US president and the ongoing economic slowdown in China were other issues that could shape global demand for travel next year, according to the political commentator.
Franklin said a Trump presidency could spark a trend of travellers journeying to the US just to experience what the country would be like under his command.
“There’s an awful lot of uncertainty,” Franklin said. “With Trump in charge it’s looking like it would be a very inward-facing America. Given his stance on immigration, Mexicans would stop coming to the US – maybe even the wider South America market would do that too. At the same time, you could well see great curiosity about life in Trump’s America in visitors from other countries.”
Franklin also highlighted the current downturn in the Chinese economy, with growth of 6.9% in 2015, its lowest in 25 years, as a warning sign for the industry given the recent increases of Chinese luxury travellers.
“China is crucially important to the world of tourism as last year the Chinese took 100 million trips abroad and that’s expanding,” he said. “But this wobble has everyone asking ‘will there be a hard landing?’ as it’s clear the rate with which the economy grew wasn’t sustainable and if [the economy] does slump, luxury spending will take a hit.”
But Edie Rodriguez, president and chief executive of Crystal Cruises, was bullish about her company’s business.
“Of course things are cyclical, but luxury cruise is recession resistant and let’s not forget that even if there are difficulties in China, the country still has one million millionaires,” she said.
And Sally Booth, head of brand for Elegant Resorts, said the slowdown in Chinese and Russian travellers had been good new for the operator’s UK clients.
“It means we have been able to get our customers into some of the top resorts in the Maldives that we have been having issues with capacity,” she said.