Financial Tribune – Iran has been ranked first worldwide in terms of price competitiveness in the World Economic Forum’s “Travel & Tourism Competitiveness Report 2019” with a score of 6.7.
Scores range from 1 to 7 where 1 means worst and 7 means best.
The report attributes Iran’s top ranking to low ticket taxes and airport charges (seventh), cheap fuel (fifth) and high purchasing power (fifth).
“Price competitiveness” is one of the four pillars of the “T&T Policy and Enabling Conditions” sub-index, which captures specific policies or strategic aspects that impact the T&T industry more directly.
“Lower costs related to travel in a country increase its attractiveness for many travelers as well as for investing in the T&T sector. Among the aspects of price competitiveness taken into account in this pillar are airfare ticket taxes and airport charges, which can make flight tickets much more expensive; the relative cost of hotel accommodation; the cost of living, proxied by purchasing power parity; and fuel price costs, which directly influence the cost of travel,” the report reads.
The 2019 report features the latest iteration of the Travel & Tourism Competitiveness Index. Published biennially, TTCI benchmarks the T&T competitiveness of 140 economies and measures “the set of factors and policies that enable the sustainable development of the Travel & Tourism (T&T) sector, which contributes to the development and competitiveness of a country.
The Travel & Tourism Competitiveness Report is a flagship product of the World Economic Forum’s Platform for Shaping the Future of Mobility, which brings together world leaders to ensure travel and transportation systems meet 21st-century demands.
This report serves as a strategic benchmarking tool for policymakers, companies and complementary sectors to advance the future development of the T&T sector by providing a unique insight into the strengths and development areas of each country/economy to enhance industry competitiveness.
It also serves as a platform for multi-stakeholder dialogue to understand and anticipate emerging trends and risks in global travel and tourism, adapt their policies, practices and investment decisions, and accelerate new models that ensure the longevity of this important sector.
The “ICT Readiness” pillar of the “Enabling Environment” sub-index, which captures the general conditions necessary for operating in a country, for Iran saw the most improvement in MENA region
The index comprises four sub-indexes, 14 pillars and 90 individual indicators, distributed among the different pillars.
Overall, Iran was ranked 89th worldwide with a score of 3.5 placed after Cape Verde and before Bolivia. Iran’s ranking improved by four places, as its score improved 3.4% since 2017. The country’s difference from the global average stands at -7.9%.
Among countries in the Middle East and North Africa region, Iran stood at 11th place after Tunisia and Kuwait. Regionally, the country’s difference from the global average stood at -3.7%.
Notably, the “ICT Readiness” pillar of the “Enabling Environment” sub-index, which captures the general conditions necessary for operating in a country, for Iran saw the most improvement in MENA region.
“Online services and business operations have increasing importance in T&T, with the Internet being used for planning itineraries and booking travel and accommodation. However, ICT is now so pervasive and important for all sectors, it is considered part of the general enabling environment. The components of this pillar measure not only the existence of modern hard infrastructure (i.e. mobile network coverage and quality of electricity supply), but also the capacity of businesses and individuals to use and provide online services,” the report reads.
Published under the theme of “Travel and Tourism at a Tipping Point”, the report’s results demonstrate the healthy growth of the industry, with increased competitiveness worldwide set against the slower improvement and adoption rates of infrastructure and sustainable tourism management practices respectively.
An analysis of country/economy and regional performance at a granular level provides interested and official stakeholders with an integrated understanding of gaps and opportunities that impact competitiveness.
It also helps ensure that the right policies, infrastructure and management systems are in place for welcoming the tourism demand that such competitiveness will activate while preserving the tourism assets, both natural and cultural, that the industry depends upon.
Spain, France, Germany, Japan, the United States, the United Kingdom, Australia, Italy, Canada and Switzerland were the top 10 in the World Economic Forum’s The Travel & Tourism Competitiveness Report 2019 in a descending order.
7.8m Tourists Visit Iran in Fiscal 2018-19
About 7.8 million tourists traveled to Iran in the last fiscal year that ended March 20, 2019, to register a 52.5% growth compared with the preceding year.
According to Minister of Cultural Heritage, Handicrafts and Tourism Ali Asghar Mounesan, the lower costs of Iran’s travel packages was a key factor in making the country more attractive for foreigners.
Iranian authorities have redoubled efforts to boost the tourism sector to increase foreign currency revenues and create jobs.
The decline in national currency last year has meant that travelling to and shopping in Iran are cheaper for foreign nationals.
The rial lost about two-thirds of its value against the dollar last year. Parts of the losses have been recuperated in recent months though.
“The development of tourism infrastructure, considerable volume of investments in the tourism sector, along with the issuance of electronic visa, and visa waiver for target countries could be the main causes of growth in the number of foreign travelers,” Mounesan said.
$1.47b in Tourist Spending
International visitors spent a total of 168,954 billion rials ($1.47b) in Iran in 2018, according to the World Travel & Tourism Council’s annual research into the economic impact and social importance of the sector.
Iran’s travel & tourism sector grew at 1.9% to contribute 1,158 trillion rials ($10.11 billion) or 6.5% of overall GDP and 1,334 jobs (5.4% of total employment) to the economy in 2018, the WTTC report shows.
The council expects the number of international arrivals to stand at 6.5 million in 2019.
WTTC also indicates that Iraq was the main source of tourism for Iran last year, as Iraqis constituted 24% of all inbound visitors.
Other major sources were Azerbaijan (17%), Turkey (8%), Pakistan (4%) and Bahrain (2%). The remaining 46% came from the rest of the world.
WTTC’s review of tourism spending in Iran in 2018 shows 93% of visitors spent on leisure activities while 7% spent on business transactions.