Vol. 424 No. 6
9 Mr. Sherlock asked the Minister for Tourism, Transport and Communications the likely implications for the tourist industry of the substantial increase in the value of the Irish pound against sterling, particularly if the current exchange rate is maintained into the tourist season for 1993; the plans, if any, she has for specific measures to assist the industry in view of these difficulties; and if she will make a statement on the matter.
We were most fortunate that the 1992 peak tourism season was almost over before the recent turbulence in international currency markets.
Given the almost daily fluctuations in recent weeks in the value of the pound sterling it is too early, at this stage, to attempt to estimate the level at which the sterling to Punt exchange rate is likely to stabilise and where it will stand next spring at the beginning of the 1993 tourist season. Neither is it possible at this stage to quantify the impact on the British market for Irish holidays next year which will be also affected by a number of other factors including the general state of the British economy, consumer spending levels, comparative inflation rates, etc.
The matter is being kept under constant review in what is an evolving situation.
Would the Minister not agree that with a 10 or 15 per cent differential between sterling and the punt, this is the time to start worrying about the tourism industry next year? Brochures are being prepared and next year's prices are being calculated. Would the Minister not agree that this is the time to offer incentives for British tourists, whom we are trying to attract? Does the Minister have any plans to build in incentives to keep up tourist numbers and would she consider, as a global incentive to tourists, the incorporation of the petrol coupon scheme?
All of those issues are, ones which, first of all, Bord Fáilte are discussing with the industry representative whom they are meeting today. The executive chariman of Bord Fáilte will be coming to see me next week in the light of those discussions to present for consideration proposals that Bord Fáilte might have in regard to the UK market next year.
However, there are swings and roundabouts in the whole currency fluctuation. We have been fortunate in that the major source of growth in Irish tourism in recent years has been in mainland Europe which is outside the sterling area. While the IR£1 has strengthened against the £1 sterling it has weakened against other major currencies, for example, the US dollar, the Deutsche Mark, the French Franc and the Dutch Guilder, all of which represent important markets for Irish tourism. Mainland Europe has been the real market for Irish tourism since 1987 with traffic increasing by over 115 per cent and revenue almost trebling to come within 8 per cent of the British figure by the end of 1991. Again, this year, even in a relatively bad year, growth from continental Europe is again ahead of the UK growth. It would not be fair to say that all of our tourism eggs are in the one basket in that the growth that has happened took place in continental Europe where the IR£1 has weakened, and that is very helpful in relation to the marketing that will be done by Bord Fáilte at this time of the year for the next tourist season.
The Minister has been disappointingly vague in her response to a direct question. I would put it to the Minister that now is the time, for forward planning so that next spring, at the start of the tourist season proper, she will have a set of proposals in place.
Will the Minister accept that the car hire industry is an important aspect of our tourism industry that has been particularly badly hit and will continue to suffer due to the currency fluctations? I put it to the Minister that if we accept in the House that any form of devaluation is out, the 10 per cent appreciation of the IR£1 represents a real threat to attracting holiday makers from the UK to this country. It is not sufficient to simply say, as the Minister says, that we should look at the swings and roundabouts and that what we lose in the UK we can pick up elsewhere. That response is simply not good enough. I would ask her what plans she has for next year, having regard to the fact that the gap between the value of the IR£1 and the pound sterling shows no sign of narrowing.
The aspect of car hire is certainly a matter for another question.
Swings and roundabouts do not attrack tourists anymore either.
Deputy Flanagan cannot have it both ways. Just a couple of minutes ago he was accusing me of not consulting with the industry in relation to the regional tourist organisations and not consulting with Bord Fáilte. I explained very clearly when I was answering a moment ago that Bord Fáilte had met the industry representatives today to specifically talk about the UK situation in relation to next year and the marketing proposals that it must now put together very urgently. I said that the executive chairman of Bord Fáilte is coming in to see me next week to discuss with me the proposals that Bord Fáilte have and indeed to listen to various proposals that I have to put to Bord Fáilte about initiatives that could be taken in relation to marketing in the UK market.
The Deputy accuses me of being vague. I think it is important to be able to establish from the industry itself where it sees specific problems arising, whether in the area of car hire or elsewhere. Therefore, it is important that we have a package of proposals that we put together to cope with the currency difficulties in relation to sterling.
I appreciate that the area of real growth has been in continental Europe and not in the North Atlantic. However, would the Minister not agree that, having debated the Shannon stop-over and also the 767 aircraft that are flying on contract to other companies in the ownership of Aer Lingus, what exactly does she propose to do about the North Atlantic tourism trade, given that with the devaluation of the British £1 Great Britain will now be seen by the North American market as being more attractive than the Republic? The question was what specific measures the Minister had to assist the industry in view of the difficulties? Has she no specific measures in mind? The Minister sat on the question of Shannon stop-over for the whole duration of her Ministry. Would she please make some decisions now in favour of next year's tourism industry which must be made now particularly in relation to the North Atlantic?
I thought I dealt with the North Atlantic when I said that the IR£1 had weakened against the US Dollar and that gives us a competitive advantage in the US market.
In relation to the UK market, I have already indicated to Deputy Flanagan and others that I am considering this matter with the greatest urgency and moving on it as quickly as possible with the support of the industry and the State organisation who deal with the industry on our behalf. At this stage the Deputy can be assured that every initiative that is felt to be necessary is being taken to ensure that this very important market for Ireland, the UK market, will be handled efficiently and effectively to retain our share of that market in the next season.
