Minister Donohoe updates Seanad Éireann on Ireland’s tourism performance

26th November, 2014

Minister for Transport, Tourism and Sport, Paschal Donohoe TD, has today (Wednesday) updated Seanad Éireann on Ireland’s tourism performance and what he is doing to ensure our recent success is built upon into the future (full speech below).


“We have moved from a position in 2010 where overseas visitors had fallen by 16% in two years, to where those numbers have increased every year since 2011.  This is thanks, in no small part, to Government initiatives such as the Gathering and the Wild Atlantic Way, and measures such as the 9% VAT rate, the British-Irish Visa Scheme and the setting of the rate of the Air Travel Tax to zero.  This has resulted in Ireland attracting almost seven million overseas visitors to Ireland in 2013, and an estimated contribution of €3.3 billion to Irish economy.  Figures released from the CSO show that we are continuing to build on that success with over 6.5 million visits recorded in the first ten months of the year – an increase of 8.8% compared to the same period in 2013. We also now have almost 140,000 people working in the food and accommodation sector as a result.


“But there is no room for complacency. The Wild Atlantic Way, which is the first ‘brand proposition’ developed by Fáilte Ireland, has been a great success, significantly enhancing the visibility of the west coast of Ireland. But in order to maintain our competitive position, we must continue to develop our tourism offering in a way that has the biggest impact on what is a very crowded international market.


“A proposition which is currently in development to encourage tourism in  the South and East of the country, which I hope to launch early next year, will see the cultural and heritage tourism assets and experiences of that region being grouped via a network of routes, trails and journeys. This will result in a new tourism experience that can easily be understood and which attract overseas visitors.


“Where Dublin is concerned, I recently established the Grow Dublin Tourism Alliance, the aim of which is to create a unifying brand identity for the capital for the first time ever. This was done to ensure that we do not continue to lose market share to other ‘branded’ cities in Europe such as Berlin and Copenhagen and to enable us to we maximise what we have to offer.


“I will be publishing my Tourism Policy Statement in the coming weeks which will prioritise medium to long term investment. This will allow us to maximise our return from tourism, which will help in supporting the jobs we already have within the sector and enable the creation of many more into the future.”



Check against delivery


Seanad Statement on Tourism by Minister for Transport, Tourism & Sport, Paschal Donohoe TD


Introductory Comments

A Chathaoirligh, I thank the members of this House for giving me the opportunity to update you on some of the key issues of relevance to the Irish tourism sector.


Tourism Performance

Before I go into the detail of the Government’s actions and future plans for the sector, I wish to firstly highlight the very significant contribution that tourism has made to Ireland’s economic recovery since 2011.


From a position in 2010 where overseas visitors had fallen by 16% in two years, we have seen overseas visitor numbers increase every year since 2011.  In 2013 we attracted almost 7 million overseas visitors to Ireland and these visitors contributed an estimated €3.3 billion to Irish economy.

Combining data from the domestic market and international visitors, total tourism revenue for the economy in 2013 was around €5.5 billion.  Of this, €1.4 billion directly benefited the Exchequer through taxation. This is a very significant contribution by any benchmark.


I am pleased to report that the picture for 2014 is again very positive. CSO figures released just this morning show that there were over 6.5 million visits in the first ten months – an increase of 8.8% compared to the same period in 2013.  This represents an additional 532,000 visitors from around the world.


The growth levels are not confined to any particular geographic area. Visits from Mainland Europe grew by 6.9% for January to October 2014, to 2.3 million visits.  North America registered an increase of 14.5% representing 1.185 million visits, and visits from Great Britain were up by 8%.

Visits from the rest of the world, mostly long-haul and developing markets, totalled 406,000 for the first ten months of 2014, representing an increase of 9.6% on the same period in 2013.

The growth level witnessed this year is particularly impressive given that 2013 was the year of the Gathering, and many feared it would be difficult to match last year’s levels.

These statistics show that our exceptional tourism product continues to deliver a unique and appealing experience for overseas visitors to Ireland.  Tourists are also heeding the advice of publications such as Condé Nast Traveller, Rough Guide and Lonely Planet, who have all recently highlighted Ireland as one of the most attractive tourist destinations in the World.


Government policies to support tourism

While the tourism industry itself deserves great credit for how it reacted to the economic downturn, it should also be recognised that the return to growth that has taken place in the tourism sector since 2011 was underpinned to a significant extent by a range of Government policy changes.

The introduction of a special 9% VAT rate for a range of goods and services, including visitor accommodation and restaurant meals, provided an immediate boost to the competitiveness of the Irish tourism sector.

Hoteliers, restaurateurs and tourism service providers have clearly indicated the impact the lower VAT rate has had:

–           increased trade,

–           delivery of a better value for money tourism product and

–           More sustainable businesses, in turn allowing them to expand and take on more staff.  It is estimated that employment in the 9% VAT categories has increased by around 30,000 since the new rate was first introduced.  There are almost 140,000 jobs in the accommodation and food sector, and overall employment in the tourism and hospitality sector is estimated to be in the region of 200,000.

I campaigned strongly at Cabinet for the retention of the 9% VAT rate, and I know its retention has been warmly welcomed by the industry.

On another taxation issue, the Air Travel Tax, introduced by the previous Government, damaged Ireland’s tourism competitiveness, particularly given our island status and the importance of air travel as a means of delivering overseas visitors to Ireland.

In Budget 2014, we set the rate of the Air Travel Tax to zero.

I am very pleased to report that airlines responded very strongly to our initiative, with substantial growth in air connectivity.


For the peak summer period of 2014, air access increased by 10% from Mainland Europe, by 14% from North America, and by 14% from Australia and other long-haul markets. I know the relevant agencies are all working hard to ensure that the positive momentum in this regard is maintained in the years ahead.


Initiatives such as Wild Atlantic Way, South and East proposition

This increased air capacity would not have been introduced by airlines unless there is a compelling business case to do so.  It is clear that the quality of Ireland’s tourism offering continues to resonate with international consumers who are deciding, in increasing numbers, to select Ireland as their destination of choice.

In order to maintain our competitive position, we must continue to develop our tourism offering in a way that has impact in the very crowded international marketplace.  To have an impact, new tourism initiatives must be of sufficient scale to push through the multitude of competing products and destinations.


This is the rationale behind Fáilte Ireland’s move towards developing what are called ‘brand propositions’ – projects of sufficient scale that they can be marketed overseas in their own right.

The Wild Atlantic Way project is the first major project to be developed on this basis.  The aim was to develop a long-distance driving route that would achieve greater visibility for the west coast of Ireland in overseas tourist markets.


It is Ireland’s first long distance touring route, stretching for 2,500km from Malin Head to Mizen Head.

The Wild Atlantic Way was developed specifically for the Western seaboard to address the decline in international visitors to the region.  It builds on what is distinctive and appealing about the West coast – its rugged coastline and powerful ocean, complemented by a deeply rooted and authentic culture and people – to give it visibility in a crowded international tourism market.

I know that it is already proving a major hit in our key overseas markets.

While Fáilte Ireland provided the central co-ordinating role for the Wild Atlantic Way, it would be impossible to develop a project of this magnitude without the support of the Local Authorities along the route and accordingly, I wish to take the opportunity to formally acknowledge and thank them in this regard.


Fáilte Ireland is currently developing a similar unifying tourism proposition for those counties in the east and south.

That brand proposition will group the cultural and heritage tourism assets and experiences of Ireland’s East and South via a network of routes, trails and journeys into a new tourism experience that can easily be understood by and will appeal to overseas visitors.

It will build on the very significant investment supported by Fáilte Ireland using capital funding from my Department across the region, such as the Medieval Mile in Kilkenny and the Waterford Viking Triangle.

I look forward to the completion and launch of this exciting new proposition next year.


Promotion overseas (work of Tourism Ireland, leveraging the new Common Travel Area visa)

While the tourism industry, Fáilte Ireland, Local Authorities and other stakeholders are engaged in the continuous development of our tourism offering, it is the responsibility of Tourism Ireland to bring that message to potential visitors in overseas markets.


In 2014, the agency has placed a major focus on car touring holidays – in particular highlighting the Wild Atlantic Way.  Tourism Ireland has also promoted key events, including Limerick City of Culture and the ‘Grande Partenza’ of the Giro d’Italia.


The agency has also capitalised on the important developments in access to Ireland that I have outlined, maximising the promotion of new, as well as existing, flights and sailings to continue to grow overseas tourism to Ireland. The organisation is also building on the legacy of the Gathering, continuing to reach out to the Diaspora across the world.


Tourism Ireland will be building on the opportunities presented by the new British-Irish Visa Scheme, which was launched last month by the Irish and British Governments.  The scheme, based on mutual recognition of each other’s visas by Ireland and the UK, is an historic breakthrough between the two jurisdictions and will be initially rolled out in the key growth markets of China and India.

The scheme will build on the success of the current Irish Short-stay Visa Waiver Programme which was launched by the Government in July 2011, and has led to significant increases in visits from the countries covered by the Programme.


Estimated visits to Ireland from China and India grew from around 25,000 in 2009 to nearly 40,000 in 2013.  The new British-Irish Visa Scheme will make it even easier for those numbers to continue growing, as the hundreds of thousands of Chinese and Indian visitors to the UK each year will now be able to travel to Ireland on the same visa.


Grow Dublin Tourism Alliance

I have already mentioned the Wild Atlantic Way which is delivering for the west coast and the new South and East brand proposition which will be launched next year. It would obviously be remiss of me not to touch on what we are doing for tourism in my own home city.

Within the global tourism market, cities have the potential to be destinations complementing the wider national or regional destination, while at the same time helping to drive the sustainable long-term growth of their country or region.


Those cities that have performed most strongly include among their strengths a distinctive brand, as well as an attractive tourism proposition, rooted in a strong national proposition.  For example, Copenhagen appeals to many on the back of both its distinctively Danish and its uniquely urban characteristics.


I recently announced the establishment of a group to develop a brand identity for Dublin, drive tourism in the capital forward and allow us to compete competitively for market share with other cities across Europe.

The group, which is being set up under Fáilte Ireland and will be known as the ‘Grow Dublin Tourism Alliance’, will be led by the Chairman of Bord Bia, Michael Carey, who will be responsible for implementing the Grow Dublin Taskforce strategy.

The Destination Dublin strategy found that while recent years have shown the beginnings of a recovery where tourism is concerned, Dublin is underperforming against its potential and has the capacity to attract even more tourists than is currently the case.


If a capital city does not fulfil its potential in terms of tourism, that has implications for the rest of the country. When the recession hit, Dublin’s overseas visits and bednights fell in line with those across Ireland.  However, looking across Europe at our competitors, many cities were able to continue to grow visits and bednights even as tourism overall fell back across Europe.


Cities, such as Copenhagen, have shown sustained levels of growth, even during the recessionary period.  And initiatives such as ‘Wonderful Copenhagen’, which is a not-for profit, public/private partnership, has seen tourism rates in that city increase by more than 8% year on between 2008 and 2012.  There is no reason why Dublin cannot do the same.


To do this, a sustainable funding model will have to be put in place. This will require a balance of funding from the public and private sector, with the current rate of public sector funding being maintained and a new private sector funding stream being identified and drawn from, which the Grow Dublin Tourism Alliance will be responsible for.


Dublin has so much to offer and by harnessing the skills of all relevant stakeholders, as well as that of Dubliners themselves, we can send a strong message to the rest of the world that Dublin is top of the list in terms of global city destinations.


The new Grow Dublin Tourism Alliance will, for the first time ever, focus on a unified branding and marketing of Dublin and will bring together key stakeholders such as the Local Authorities, tourism agencies and industry representatives, as well as experts in key sectors such as marketing and communications.

The Alliance will also be responsible for putting in place a sustainable funding model to support the project. I look forward to seeing the fruits of their work and have no doubt that Dublin will play a significant part in achieving the ambitious overall targets which we have for Irish tourism in the years ahead.


Tourism Policy Review

And in terms of the years ahead, I will be publishing, in the coming weeks, a Tourism Policy Statement which will prioritise investment to maximise the return from tourism in the medium to long term.

It will build on the complementary strengths of our uniquely friendly and welcoming people, the beauty and historic heritage of our places and the support and commitment of Government policy.

A draft version of the Tourism Policy Statement was published in July, in order to provide tourism stakeholders with an opportunity to provide feedback.  It addressed issues such as a switch in focus from visitor numbers to visitor revenue, the sustainable development of our tourism infrastructure, the development of increased community engagement with tourism, and ensuring that the tourism sector has the appropriate skills to meet the needs of future visitors.


I plan to bring the finalised Tourism Policy Statement to Cabinet for approval before the end of the year.  The new Tourism Policy will seek to build on the gains made in recent years and chart a course to achieving a significant increase in tourist revenue and employment in the sector over the course of the next decade.

The overall tourism goal of Government is that by 2025, revenue from overseas visitors, excluding carrier receipts, will increase to €5 billion, excluding the effects of inflation, and that employment in the sector will rise to 250,000.

Immediately following publication of the Tourism Policy Statement, I will appoint a Tourism Leadership Group, which will prepare and oversee implementation of a Tourism Strategy and Action Plan.

The Plan will set out specific actions required to achieve the objectives contained in the Tourism Policy Statement. I know the Statement itself and the Action Plan will be of interest to you all and I look forward to returning this House again in the future to keep you fully abreast of developments in this regard.


Concluding comments

A Chathaoirligh, Senators, I trust that I have given you a good account of where we are in relation to tourism and how we are planning for the sustainable growth of tourism into the future.

I now welcome the opportunity to hear the views of Senators on this sector which will continue to be of vital importance to every region of Ireland in the years ahead. Thank you.