Foreign holidays suffer as economic climate worsens

Recession and weak pound sees number of British visits abroad fall faster than at any time since the 1970s.

Bruised by the recession and struggling with their diminished spending power in tapas bars and trattorias, Britons are spurning the temptations of foreign sun spots and exotic cities in record numbers, leading to the fastest drop in visits abroad from the United Kingdom since the 1970s.

Figures published by the Office for National Statistics showed a record 15 per cent decline in the number of trips abroad by UK residents in 2009 as the beaches of Cancun, the hotels of Marbella and the villas of Umbria lost some of their allure. In total, Britons last year spent £5.1bn less abroad than they did in 2008.

Taken alongside predictions that it will take until 2012 for Britain's outward-bound travel industry to return to pre-credit-crunch levels, the findings suggest that in the short term at least, the foreign holiday is likely to remain an unaffordable luxury for millions of Britons for whom it had previously been a regular fixture.

Although business trips were and remain the hardest-hit sector, dropping by nearly a quarter last year, the foreign-holiday market suffered a dramatic slump in a series of trendy and established destinations. Mexico saw a 41 per cent drop in British visitors, largely because of the knock-on effects of the swine flu outbreak last year.

But heavy falls were recorded elsewhere, with New Zealand experiencing a 30 per cent fall in British visitors, Portugal down 29 per cent and Malta, a long-standing outpost of sun-worshipping Brits, experiencing a 28 per cent fall. Canada suffered a drop of more than a quarter. The only places to see a rise in British visitors were Egypt, Jamaica and Lithuania, while 2.2 million fewer Britons went to Spain, 1.1 million fewer headed for France, and 820,000 fewer boarded flights heading for the United States.

The findings confirm the trend for holidaymakers choosing to stay in Britain and sample the domestic delights of a traditional seaside resort or city break. VisitEngland last year recorded an 18 per cent increase in the number of vacations taken by UK residents, pumping an extra £1bn into the economy. Euromonitor International last month said it expected the British foreign holiday market would only recover in 2012, adding it would take the global hotel industry six years or more to return to pre-recession levels.

One travel-industry analyst said: "The early signs are that things are going to be better this year than they were in 2009. But I'm afraid that isn't saying much. Things really got pretty tough last year and even though we're coming out of recession, a lot of people are not feeling wealthy enough or confident enough in their prospects to splash out on that week or fortnight abroad. It'll take at least a couple more years for the situation to unwind."

The disruption caused by Icelandic volcanic ash cloud and uncertainty generated by the British Airways cabin crew strikes have also slowed the recovery, although many in the industry are bullish about its prospects.

TUI, the German travel giant which owns the Thomson and First Choice brands in Britain, said it had experienced a 4 per cent year-on-year increase in bookings from the UK and that holiday reservations across the group for the August peak were up 9 per cent.

The Association of British Travel Agents (ABTA) said a recent strengthening of the pound against the euro and falling prices in some key markets were tempting Britons back overseas. Spokeswoman Frances Tuke said: "Some of our favourite countries, such as Spain, have seen a drop in prices. Hoteliers have cut their prices to attract visitors, and coupled with the strengthening of the pound compared to the euro, prices have dropped for holidaymakers this summer."

The decline in foreign travel follows a long period of growth in the market which has seen the number of visits abroad rise from 11.9 million in 1975 to a high in 2006 of 69.5 million. But while Britons are reducing their amount of overseas travel, it seems the UK remains a popular destination for those coming from abroad.

The ONS figures showed an overall decline of 6.3 per cent in the number of visits to the UK by foreign visitors but an increase of 500,000 in the number of holidays being taken here. Helped by the weakness of the pound against the euro last year, spending by overseas visitors also grew in value from £16.3bn in 2008 to £16.6bn.

Hoteliers from the Algarve to Florida may be mourning the loss of British visitors, but business in at least one unlikely destination for tourists is blossoming: tourism to Iraq has increased by 60 per cent. Geoffrey Hann, owner of the adventure-holiday company Hinterland Travel, said: "We have no shortage of people wanting to go to Iraq. Last year we took 80 people, this year it will 200 and we are planning to quadruple that figure for 2011."

Holidays by numbers

15 The percentage decline in the number of trips abroad made by British tourists in 2009 compared with the previous year.

2.1 The previous largest annual percentage fall in British people visiting abroad – in 1985.

5.1 The drop in total spending, in billions of pounds, by Britons abroad in 2009 compared with the previous year.

6.9 million business visits were made by UK residents last year, down from 8.9 million in 2008, representing a drop of 23 per cent.

39 The number, in millions, of holidays abroad made last year, which is down from 46 million the year before. Visits to friends or relatives abroad also fell from 12.4 million to 11.6 million.

41 The percentage drop in visits to Mexico, one of the biggest losers in the trend for fewer trips abroad.

38 The percentage of British trips abroad that were package holidays. This was down from 39 per cent in 2008, and 41 per cent in 2007.

25 The percentage increase in the number of trips by British residents to Poland, one of the few countries to see a rise in visitor numbers. Two-thirds of these visits were to visit their families or friends.

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