The PUP and Tourism...The Hon. Said Musa's address to the BTIA

The Honourable. Said Musa, Party Leader of the opposition People's United Party (PUP) was the guest speaker at a Belize Tourism Industry Association (BTIA) fundraising dinner on June 13th, 1997.

The Annual General Meeting of the Belize Tourism Industry Association offers a truly unique opportunity for the members of your important organization to come together to discuss those issues which most affect Belize's tourism and hospitality sector. I am truly honored by the invitation to address you tonight, in this eleventh year of BTIA's existence.

Tonight as we stand on the threshold of a new millennium, it becomes clearer than ever before that the only recipe for sustainable development and long-term success in many industries, including tourism, is one that combines the ingenuity of the private sector with the responsibility of good government. I have no doubt that the members of BTIA's executive recognize the need for enhancing this vital partnership between policy-shapers and entrepreneurs.

At the ITB Tourism Industry Trade Show in Berlin, Germany in March, the World Tourism Organization forecasted the continued explosion of international tourism, reporting that 1996 international arrivals totaled 592 million, that 212 million persons were employed in the tourism sector worldwide and that US $423 billion was spent on international travel. If these numbers seem astronomical, the prediction for the next 20 years is even more mind-boggling: by the year 2010, arrivals will surpass 1 billion and by 2020, international arrivals should top 1.6 billion people. Tourism and travel, beyond the shadow of a doubt, is truly one of the world's most dynamic industries.

In Belize, starting thirty years ago, we have witnessed tourism's expanding role in our economy and today it represents the principal business for local airlines, hotels and resorts, tour operators and taxi drivers, craftsmen and women, restauranteurs, tour guides, dive operators, travel agents, car rentals, producers, importers and entertainers. Entire communities have become transformed by tourism and dependent upon its activities. In San Pedro. for example, where in 1963 Celi McCorkle started the development of the 5 room and one bathroom San Pedro Holiday Hotel, today San Pedro boasts 52 hotels and resorts and 728 rooms. In Belize City, where the Fort George hotel opened in 1953 with 35 guest rooms, today there are 60 hotels and 837 guest rooms.

Perhaps the most visible growth in tourism to Belize has come during the last ten years with American and Continental Airlines adding to Taca Airline's routes to Belize City, with the birth of the Belize Tourist Board in 1990, with global hotel chains such as Radisson, Fiesta and Best Western entering our market, with Belize attracting its first scheduled charter from Canada's Adventure Tours, with tour operators acquiring modern buses, with tour guides being licensed and trained. Add to this the inauguration of a new international airport terminal building, the Belize City Infrastructure Project improvements, the completion of the Western Highway to the border with Guatemala and the work on the Hummingbird and Southern Highways and it becomes evident that Belize has the ingredients of a world-class tourism destination.

Today, according to the available statistics, 3,833 Belizeans are employed directly in the tourism sector and some 15,332 Belizeans participate in the industry indirectly. Tourism receipts exceeded 167 million dollars last year with hotel revenues alone totaling 35.9 million dollars.

With this growth in tourism's contribution to our economy and in view of the substantial investments in the industry, Belize must come to grips with the reality that we are now a regional player, competing for market share with the likes of Costa Rica, the Cayman Islands and Mexico. Together, the private and public sectors need to forge a vision that is premised upon specific objectives and a vision that accounts for Belize's tourism strengths and weaknesses.

We are fortunate to be considered a part of the Caribbean, allowing us access to the tremendous networks of the Caribbean Tourism Organization and the Caribbean Hotel Association. At the same time, our newly peaceful neighbors in Central America view Belize as part of their grouping and as a matter of fact, Belize holds the Presidency of the Federation of Chambers of Tourism of Central America (FEDECATUR). Along with Mexico, Belize also lies at the heart of the Mundo Maya, a distinction that has placed enormous marketing possibilities at our doorstep. Rather than be overwhelmed by all these affiliations, Belize's national tourism policy must seek to capitalize on our strategic location and diverse attractions. But first we need to formulate this policy, so that together the Ministry of Tourism, the Belize Tourist Board, and the private sector with all its different components, can be working towards common goals. Belize does not need to choose between being a dive destination or an eco-tourism paradise; indeed, our national tourism plan should outline a broad strategy for the simultaneous development of the dive market, eco-culture segment, adventure niche, educational tourism, meetings and conference business, and medical and retirement tourism.

Our People's United Party is committed to a national tourism policy which will direct Belize's active participation in Caribbean and Central American initiatives. We must be a full-hearted member capitalizing on both regional bodies rather than a half-hearted member gaining from neither. As the bridge between Central America and the Caribbean, Belize's service industry can blossom.

We have heard the present Government cry over the cost of air transportation to Belize accusing the airlines of "being in bed together" to the detriment of our country. Our approach is to find solutions rather than place blame. Price responds to the basic laws of supply and demand. Quite simply, the cost of flying to Belize will decrease with additional airline service which will only come with increased tourist arrivals. In the absence of a local airline, we view favourably the Open Skies Agreement with the United States, which we believe would open the doors to increased competition and reduced airline ticket prices. We do not view favorably, however, the need for any international airline to fly between destinations within Belize, since our local carriers have made enormous financial sacrifices to survive. Through firm leadership, we must assert our right to land our airplanes and operate our buses in neighboring countries if those countries expect to operate their airplanes and tour buses without difficulty in Belize.

We call for transparency in the operation of the Belize Tourist Board. It should no longer be allowed to operate in high secrecy: the BTB should be accountable to the industry for the 2 1/2 million dollars it received in 1996; it must be reliable and timely in its data collection; it has got to be professional in its enforcement of industry standards and it must be responsible in its relations with the private sector.

In our view, tourism is too critical an industry to operate exclusively on the 7% hotel tax. We believe that in the same way that the Ministries of Agriculture, Health or Education receive an allocation from the general revenues of government, the Ministry of Tourism and the Environment would also be eligible for general revenue funds. In this way, the maintenance of national parks and archŠological sites and the activities of the Ministry of the Environment will be inextricably linked with Belize's destination marketing, tourism education and training, and policy formulation and enforcement.

We are convinced that the key positions at the BTB should be based upon the individual's qualifications rather than their political affiliation. A more efficient system of administration needs to be introduced - one that includes Assistant Directors of Tourism responsible for Marketing and Public Relations, for Product Development and for Administration. Furthermore, the composition of the Board of Directors should reflect the industry's best talent and experience. For this to happen, though, the private sector needs to come together so that individuals can be elected to represent the various segments of the industry in a way that inspires confidence as opposed to causing division. Too often, the interests of a few within the industry are addressed by government so that it can get away without addressing those interests that concern the majority.

The approval of special licenses such as logging permits, should no longer be the exclusive prerogative of the Ministry of Natural Resources; forest management must include environmental impact assessments and we believe that protected areas should fall under the purview of the Ministry of the Environment. In today's travel market, where the eco, culture and adventure tourism segments are growing by 15% annually, compared to the overall market's 4% annual growth, the conservation of our natural and heritage resources cannot be divorced from a responsible tourism growth policy.

The hotel sector is the foundation of any tourism product and Belize's 360 hotels have been taking a beating, either going out of business or on the brink of financial collapse. When the BTB reports that the national occupancy rate is 27%, why is it so difficult for us to see that without a dramatic upturn in arrivals, it is simply a question of time before bank obligations or recurrent expenses result in bankruptcy? The budget speech in March reported that tourist arnvals had declined by 10% in 1996 as compared to 1995. Less than two months later, the Tourism Minister expects us to believe that visitors arriving through Punta Gorda who were previously unreported, have caused an actual 17% increase in tourist arrivals to Belize. Well, not only do we reject this manipulation of data, but we also insist from the figures we have reviewed that the first three months of 1997 have seen an additional 13% decline in arrivals. It is unacceptable for the rest of the world to be speeding into the information age while Belize crawls at its own pace with an unreliable system of data collection. Not only should there be absolute confidence in BTB statistics but data should be routinely distributed to the private sector. How are we to determine where to invest our marketing dollars without knowing which markets are producing visitors? Why is it so difficult to implement the new tourist information card and install computers at the three major points of entry to Belize? We say it is a question of leadership. Belizeans are tired of excuses.

Belize's trend of declining arrivals comes when many Caribbean destinations are experiencing continued growth this year: Barbados up 4.8%; U.S. Virgin Islands up 25%; Puerto Rico up 11%; St. Maarten up 36%; Antigua and Barbuda up 100%.

We call on the Government, working closely with the private sector, to implement an emergency marketing program to boost occupancy and breathe life into an ailing tourism industry.

The BTB should commit that at least half of the hotel tax will be spent on marketing compared to the present estimate of only a quarter. Tourism promotion in the United States should be consolidated where both the public relations and brochure distribution functions can be executed more cost effectively.

Promotional materials which carry the imprimatur of BTIA for the benefit of the industry as a whole, which cannot be printed locally can and should be exempted from taxes.

Belize also needs a genuine marketing office in Europe to implement our sales strategy on that continent.

Our marketing approach needs to be comprehensive: target those who sell packages such as travel agents and tour operators but also those who buy packages - the consumer. We must ensure that Belize is available at the point of sale, especially for higher paying, up-scale tourism.

We need to forge strategic alliances with those airlines servicing Belize and new alliances with those operators who control major markets in the US, Canada, Germany, and Italy and we need to support our alliances with marketing dollars.

In our major market, the United States, more and more business is being conducted via the Internet. Belize's world-wide web sites must have the interactive capacity that will allow us to measure visits to the site and conduct the appropriate follow-up. Market intelligence tells us that half of the US $1 billion being spent by consumers over the Internet is spent on travel; by the year 2000, over 200 million computers will be "on-line" and dollar sales will have tripled to $3 billion.

Every Belize mission abroad should focus on promoting tourism and a PUP administration would insist that government foreign service personnel serve as an additional marketing tool.

Special attention must be given to bed and breakfast properties which require the most urgent marketing support - they represent a major source of investment and employment.

Regis McKenna, in her book Relationship Marketing, defines the marketing process much the way we see it: "Marketing today is not a function; it is a way of doing business. Marketing today is not just a new advertising campaign or this month's slogan. Marketing has to be an all pervasive part of everyone's job description, from the receptionist to the Board of Directors. Marketing is neither to fool the client nor falsify the product's image. It is to integrate the client into the design of the product and to design a systematic process for interaction that will create substance in the relationship."

To support our party's serious integrated approach to tourism, a new PUP government would ensure that as a matter of practice, the key Ministries of Finance, Education, Works, Health, Natural Resources, Agriculture and Foreign Affairs would work hand-in-hand with the Ministry of Tourism and the Environment. An inter-ministerial committee, led by the Prime Minister, will serve to enhance this integrated approach.

If tourism is to achieve success in Belize, a majority of Belizeans must become convinced that this industry offers the chance to gain a meaningful job, that its economic benefits can lead to a better standard of living and that it offers bona- fide investment opportunities for Belizean entrepreneurs. A Mundo Maya tourism strategy must provide concrete benefits for the indigenous people whose history, culture and civilization embody the product of the strategy. Belizeans must be at the center of tourism development if the industry is to achieve long term success. Training and education in tourism and hospitality is the best means of achieving this end. The 21st. century must not meet Belize without basic training and certification for tourism industry professionals nor can we afford the threat of crime and violence to scare our potential visitors away.

The University College of Belize, the Belize Technical College and the Center for Employment Training currently offer courses in certain specialized areas of tourism. We need for tourism awareness courses to be available at the primary and secondary school levels, for tourism management studies to be offered at the tertiary level and for a continuous public relations campaign promoting the numerous benefits of the tourism industry to Belize.

Tourism tax policy should not be to extract as many taxes as possible from the industry but rather to apply as few taxes as necessary. On the heels of the 2% gross receipts tax, came the 15% value added tax. The hotel tax was raised from 5 to 7%; excise duties on liquor and beer increased by 30%; entrance fees to parks hiked by as much as 200%; taxes on international airline tickets jumped by 50%; departure fees raised by 40%.

What more evidence do we need of a misguided tax policy than the case of the cruise ship passenger tax which was doubled from $ 10 to $20, then reduced back down to its original level after the industry resisted? The PUP's commitment is to an ongoing dialogue with the private sector conducted in good faith so that decisions regarding taxation do not choke development.

In addition to containing any further increases in tourism taxes, we see the urgent need to provide formal relief to key segments of the industry. In the same manner that hotel projects are granted consideration for development concessions, local airlines, national tour operators and other capital intensive investments should have the chance for relief.

When private and public sectors come together in support of a national tourism policy, when we focus on marketing as a science rather than trial and error, when we provide tourism training and education regarding tourism's benefits and when we develop our product by investing in better roads, improved signs, cleaner streets and rivers, safer neighborhoods, and more value for money, only then will we begin to realize the full potential of Belize's tourism industry.

When these private and public sector components come together, additional airline connections introduced, the proper development of high potential areas such as North Ambergris Caye and the Southern Coastal areas, the expansion of the runway at the International Airport, and the construction of the tourism village in Belize City with the possibility of a cruise ship terminal, we will see tourism arrivals increase dramatically.

Ladies and Gentlemen, Tourism in Belize has emerged. It is a leading sector in the national economy not only in terms of the foreign exchange generated and the employment created but also on account of the momentum it is capable of imparting to other key sector - agriculture, manufacturing, construction, banking, finance and other services. Through powerful linkages that can be fostered between tourism and these other sectors, the industry can be an engine for boosting growth in the entire economy. In addition, a national tourism policy that maintains cultural sensitivity and environmental consciousness can transform the lives of all Belizeans with that unusual combination of greater prosperity with multicultural harmony and national dignity. That is the promise that is the challenge for Belize Tourism.

Thank you

San Pedro Sun

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