There are fears, however, that President Trump’s latest travel ban may curb growth. The executive order signed on January 27 blocks citizens of seven majority-Muslim countries in the Middle East and Africa from getting visas to travel to the US for at least 90 days.
The order brought a swift decline in the number of worldwide tourists and travelers looking to visit the US. The biggest drop-off occurred among prospective travelers from the Middle East, Africa and Europe.
The numbers of hotel and ticket bookings are down, and even online searches for hotels in the country declined as well. In the latest string of report by the Global Business Travel Association (GBTA), President Trump had cost the US US$200 million lost in revenue in business bookings within the first week following the travel ban. This shows that the ban can be as damaging to the US tourism sector as the September 11, 2001, terror attacks.
Mergent anticipates a challenging year for the hospitality and tourism sector, where the country is expected to see a large decline in foreign tourism. With the sector declining, the U.S. trade deficit would be about 20% larger, US$600 billion instead of US$500 billion. Thus, the questions now is — how long can the US go on by keeping out more international travelers, as many are in fear that Trump will pull another ban that could leave them stuck.
Hoteliers, including Starwood (NYSE: HOT) and Marriott (NASDAQ: MAR), are already targeting the unsaturated markets such as China, Russia, Brazil and Africa. Demand for hotels in the international market is greater than in the US and the recovery pace is faster. India is also becoming a hot spot for western hoteliers, as it is emerging as a global business hub, while major players are also targeting Brazil because it primarily attracts affluent domestic tourists in the flush of an economic revival.
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