Foundation for P.R. unveils visitor economy study

Written by  //  March 17, 2016  //  Economy  //  No comments

FPR Chairman Jon Borschow

FPR Chairman Jon Borschow

An important part of the local economy, and the only one showing growth, tourism represents a great opportunity for growth in the short and medium term for Puerto Rico, according to the findings of a study released by the Foundation for Puerto Rico Wednesday.

The “Visitor Economy: From knowledge to action” report is the first of several research efforts developed by the Foundation in favor of the development of the island’s visitor economy. It uses available data of the sector to provide a framework of Puerto Rico’s tourism industry It also presents the concept of the visitor economy and the benefits that it represents for the economic development of Puerto Rico.

“In FPR, we are contributing with knowledge to provide continuity to existing efforts and to support the  development of the tourist sector facilitating, in this case, a framework that can tell us where we are, and toward where we should be heading so that the sector can grow”, said FPR Chairman Jon Borschow.

“If we consider tourism our first priority as an important part of our economic strategy, we can sustain an accelerated growth that would change the economic trajectory of the island,” he said.

To understand how Puerto Rivo can strengthen and accelerate the growth of the tourism sector, the nonprofit believed it had to begin by analyzing its present state, said Arnaldo Cruz, the FPR’s director of research and analysis.

“We also believed its was important to evaluate the global trends and panorama of the sector,” he said. This is the first of several research efforts developed by the FPR in favor of the development of a visitor economy on the island.

“The first part of the document aims to explain industry concepts and definitions since it is important to know that all travelers who enter Puerto Rico are not tourists and we need to be able to distinguish between these two categories,” Cruz said.

There are other important distinctions that are further explained in the document that are fundamental to correctly segment the activity of the visitors and to measure the contribution they make to the visitor economy. Data collection was the greatest challenge in preparing this study, he added.

In Puerto Rico, measuring the tourism industry is a particular challenge because the vast majority of travelers arrive on domestic flights from the U.S mainland and they do not pass through immigration and customs, where these data are typically collected. The challenge expands to the rest of the sector’s data chain, as Puerto Rico lacks a tourism statistics system and in many occasions, the information available does not fulfill the World Tourism Organization’s international guidelines, FPR officials said.

The report introduces the concept of the visitor economy, with the purpose of expanding the understanding of the impact of the tourism industry. The economic model proposed within the visitor economy not only examines the direct impact the tourism industry has on the island, but also measures the indirect impacts it has on the supply chain of good and services, as well as the induced effects it has on the general economy.

In the 2015 the number of visitors at the global level increased by 4 percent, similar to the growth rate of previous years. Puerto Rico also has been growing since 2009, but at a smaller rate than the global trends; whereas the growth of the Caribbean region surpasses the island growth. At present, Puerto Rico receives 14 percent of the region’s visitors, losing the dominant position it held decades ago.

“The robust and increasing regional demand indicates that there is still much space to grow and to develop this sector in Puerto Rico,” Borschow said. “For that reason, this report promotes the public creation of a coherent, political and effective strategy for the development of the tourism industry that works in an integrated way, inserting all the elements that generally affect the growth of the sector and the economy.”

The visitor economy provides helps all sectors of the economy, promotes job creation, spurs community-based entrepreneurship and self-management, reduces poverty, increases outside investment and exports, improves infrastructure, and preserves cultural and natural patrimonies, among others, the FPR said.

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