The World Travel and Tourism Council’s (WTTC) report made public by National Hotel and Restaurant Association (Asonahores) Vice President Simon Suarez two weeks ago contradicts Central Bank estimates that suggest good results for the tourism sector for the first eight months of 2005, with an 8.37% increase of foreign visitors. The WTTC presents a somber panorama for the sector in 2005, which could be jeopardized by foreign competitors if the causes are not eliminated. The WTTC reports on a 12.1% drop in employment in Dominican tourism and a 17.0% drop of the GDP directly generated by the sector, which, according to Suarez, contrasts with the performance of the rest of the Caribbean with good forecasts for 2005 and the next ten years. The government has argued that Asonahores is exaggerating the sector’s crisis situation in order to pressure for tax incentives – including a different 8% VAT for tourists, the elimination of the selective consumer tax for hotels and the keeping of the incentive law, among other points. In a recent press release, the Ministry of Tourism says that the WTTC’s forecast for 2005 is based on economic data corresponding to the first semester of 2004, when the situation was not positive.
Suarez, who is also vice president of Coral by Hilton hotels, was interviewed by Clave Digital. He spoke of funds invested in promoting the DR abroad which have only amounted to 13 or 16 million US dollars whereas the income is around 60 million. He said that the promotion campaign is perking up, having been completed in Europe, and he understands that there will be a meeting at the end of October to discuss the campaign in the US. He believes that inconsistencies make the promotion of the DR inefficient.
Asonahores has not made formal technical observations about the Central Bank’s statistics but they are surprised with the results, said Suarez. He downplayed the government spokesman’s comments about Asonahores’ exaggeration of the crisis by saying that the state’s requirements in the proposed tax reform to compensate for the DR-CAFTA could also be considered exaggerated. He believes those arguments should not be used in this issue. Referring to the foreign exchange rate he believes that the market is moving towards a level of balance, which he understands should be around RD$35 to RD$37 per US$1.