Cover Report
Tourism Down, But There Are Positive Trends
Virgin Blue may come to the rescue
Vanuatu tourism, vital for the national economy, dipped quite badly in 2002, with fewer arrivals from Australia, the biggest market.
Pure holiday arrivals were down to 38,698, 2600 less than the 2001 figures and 6117 below the 2000 peak of 44,815.
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As usual, another 10,000 in the "business" and "visiting friends" categories helped swell the numbers, but didn't obscure the fact that core holiday traffic had weakened.
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While there was a pick up of business in the first quarter of this year, says Linda Kalpoi, head of Vanuatu's National Tourist Office, nearly all the country's hotels are currently suffering low 30 percent occupancy rates.
Many restaurants in Port Vila, where there are about 60 of all kinds, are near empty.
Travel trends in Australia, where people are being lured by the local travel trade to holiday in-country, not out-country, contributed to the erosion of Vanuatu's business.
But in Port Vila the local trade puts more blame on Vanuatu's small national promotion budget, this year under US$600,000, and what it says is the government-owned Air Vanuatu's bad mistake in terminating flights to Melbourne, which with 5 million people in and around that city is a far larger market than New Zealand, the second market, with around 7500 holiday visitors after the 30,000 or so from Australia.
Bryan Death, who runs the Iririki Island resort in Port Vila Harbour for its Melbourne owners, says after Melbourne flights ended business for Port Vila's two other main hotels dropped significantly.
"We dropped by only 10 percent because we have a strong marketing presence in Melbourne," he says.
Air Vanuatu is expected to announce a fair profit for 2000, a rarity for it, and plans to replace the 126-seat jet it used for flights to Sydney, Brisbane and Auckland with a slightly larger one.
The airline's cautious attitude is that it can't afford to virtually subsidise the hotels by flying visitors in at next-to-nothing fare rates.
What the trade hopes is that the Australian domestic carrier, Virgin Blue, which plans to operate to as yet unnamed Pacific Islands ports, will come to its rescue later this year by operating Melbourne/Port Vila flights.
Despite despondency about tourism, all is not dead.
One of Vanuatu's two major resort hotels was taken over on April 1 by Warwick International, the Hong Kong headquartered global chain of 35 large properties, including in Fiji the Warwick and Naviti resorts.
Formerly operated as the Crowne Plaza, and before that the Le Lagon Park Royal, the 141-bedroom and four-overwater bungalow property is located on a 75-acre site overlooking the Erakor Lagoon in Port Vila.
It was bought by Warwick outright.
Dixon Seeto, Warwick's vice-president Pacific, says over the next few years several million dollars will be spent on improving the hotel, which has had its original name, Le Lagon, restored to it.
Warwick's arrival is a good omen for Vanuatu.
Other significant developments are Air Pacific's decision to resume from April 20 a weekly flight, on Sundays, to Port Vila from Nadi with a Boeing 737-800 after an absence of some years. Air Pacific is indicating that it will promote Vanuatu as a destination for American and European travellers carried to Nadi by its Los Angeles service, Kalpoi says.
Kalpoi says New Zealand business is improving. Her office this year has an extra 10 million Vatu (US$71,400) budget, taking the total to 78 million (US$557,000). But this is a drop in the ocean compared with the US$5 million spent this year by Fiji, Vanuatu's main competitor, which does allow much scope for overseas promotion. After years of stagnation, Vanuatu's hotel room count has risen from about 700 to 1237 by the end of 2002, with about 85 more to enter the inventory between June and September, according to the tourism office.
