Cardiff Castle: The Welsh fear their country’s charms are being undersold / Getty
It is little more than the used to attract visitors to Jersey. Tourism chiefs blame devolution, and want Westminster to help

It may be the land of Arthurian legend, majestic mountains, towering castles and wild water but the Welsh fear their country's charms are being undersold. Welsh tourism groups have slammed the £7m budget used to promote Wales "hopelessly inadequate". Its marketing budget is dwarfed by those of other parts of the United Kingdom. Scotland spends £47m on promotion and even the seven-mile long Channel Island of Jersey has nearly as big a budget as Wales, at £6m.

In a series of submissions to Westminster's Welsh Affairs committee, tourism leaders complain that the number of international visitors has dwindled since tourism was devolved to the Welsh Assembly in 1999. The number of overseas visitors to Wales has fallen by 250,000, while those to England, Scotland and Northern Ireland have risen, according to the Welsh Association of Visitor Attractions (Wava).

They express frustration at the slow progress of Tourism minister Edwina Hart's promotion strategy, and point out the industry is worth £8.7bn to the Welsh economy, representing 18 per cent of GDP. The group describe the tourism budget as "pathetic" and argue that the Welsh Assembly has been unambitious in its targets for tourism revenue growth. At 10 per cent by 2020, this is significantly lower than England's target of 51 per cent and Northern Ireland's 81 per cent.

"Many are dismayed by what is happening within Welsh tourism under stewardship of the Welsh Government," they told MPs. "If the Welsh Assembly Government does not increase their marketing spend Welsh tourism/attractions will inevitably slowly decline as our markets are gradually captured by other parts of Great Britain."

In a separate submission, Wava chairman Stephen Bristow said: "I feel very strongly that the sum allocated to marketing Wales is hopelessly inadequate … The Welsh Government should allocate at least five times as much money to the marketing budget if it is to compete successfully with other countries."

Mr Bristow warned yesterday that "iconic attractions" such as Caernarfon Castle, built for King Edward I in the 13th century, were potentially missing out. He added that the Nato summit to be held in Newport, Gwent next month should be used to "push the importance of Wales", but said he doesn't think Wales has learnt from mistakes made at the Ryder Cup four years ago.

Welsh academic Dr John Ball pointed out that there was "disappointment with the supposed benefits of the Ryder Cup" – the team golfing event was held at Celtic Manor in 2010. The summit is taking place at the same luxury resort.

In its own submission, the Welsh Government insisted that it is "finalising a brand communications plan" to promote the country during the summit. This includes Welsh destination information on the Nato 2014 journalism website.

But the Welsh Government blamed politicians at Westminster and organisations such as Visit Britain for Welsh tourism's woes. It said it had "raised concerns" with Visit Britain, the UK tourist board, that "recent growth in inbound tourism to Britain is not translating into business for Wales".

A spokeswoman said: "We believe there needs to be a step change in the working relationship, with Visit Britain to support a stronger, distinct destination brand profile for Wales, and to ensure a more equitable and increased share of the growth in inbound visits to Wales."

The coalition government was also criticised for failing to cut VAT on tourism from 20 to 5 per cent. That reduction would boost the Welsh economy by £170m, according to campaign group Cut Tourism VAT and would be more in line with countries elsewhere in Europe.

The Welsh Government spokeswoman said: "The comparison between Scotland and Wales's marketing budgets is misleading. Wales's marketing budget is broadly proportionate to other UK counties and the total funding for our tourism industry this year alone is over £20m. The Nato summit is a UK Government led event, but we are working closely with them, along with local authorities and other partners to ensure we maximise every possible benefit."