No one will argue that we are in uncharted territory with respect to the movement of people across international boundaries. This week’s executive order, signed by President Donald Trump, raised the uncertainty to new levels.
I’ll leave the legal and moral implications of the President’s decisions to others, more qualified, to respond. From a tourism business perspective however…and a Canadian perspective at that…two issues are worth noting.
First is the potential impact on the convention/meeting/business events industry. This is a double-edged sword. On the one hand it’s easy to see the opportunities created for Canadian convention venues by international associations and corporate entities. Such potential arises from the unwillingness of meeting planners to risk access to the U.S. by speakers and delegates travelling from the affected countries, as well as those sympathizing along religious or cultural lines, or simply on principle.
The other side of the sword is President Trump’s “Buy America. Hire America.” policy. This could result in a situation where the U.S. government pressures American companies to stay in the United States for convention and trade show events…a policy easily created through restrictive expense policies (e.g., altering the tax treatment of convention expenses incurred in a foreign country). If this sounds familiar, perhaps it’s due to the negative impacts from President Obama’s ill-timed comments about conventions in Las Vegas–and at resorts generally–during the 2008/2009 financial crisis
The other issue affects all international leisure, business and VFR travellers and could be even more impactful. About one third of all visitors to Canada in the first half of 2016 entered from United States, either because of flight routings, a decision to include both countries in a trip itinerary, VFR connections on both sides of the border, business meetings/relationships or some other reason. These data are for a fixed point in time, but broadly indicative of the significance of two-country trips. Further, data are not available for visitors that first entered Canada and then travelled to the US, so the number of two-country trips is actually larger than shown.
Decisions by international travellers not to visit the United States, as either retaliation for the recent travel bans and/or a perception of a less welcoming society, could have a significantly negative impact on Canadian tourism. The importance of increasing air routings and capacity to/from Canada cannot be overemphasized in light of the current environment.
It’s early days for the new U.S. administration. Let’s hope Canada, and our recovering tourism industry, doesn’t get caught as collateral damage in this new direction for American policy. It’s only the President’s second week in office….
