International tourism as an element of local and national export policy

Deloitte Canada released an interesting report today, Passport to growth: How international arrivals stimulate Canadian exports, which avers that foreign visitors help develop relationships that influence exports.  From the press release:

Deloitte analysis, using Canadian data and established empirical techniques, suggests that each one percent increase in tourists to Canada generates an $817-million increase in Canadian exports over the following two years. Deloitte also found that this increase in travel would increase the range of Canadian goods exported by 0.27 percent for each one percent increase in international arrivals.

The report explains that when people travel, there is opportunity to connect face-to-face and deepen business relationships, which in turn opens up pathways to new markets. And travel - both leisure and business - creates demand for domestically produced goods by introducing people to local products.

Also see "Tourism boom misses Canada" from the Toronto Globe & Mail.

Interestingly, while the report argues that "Canada" should do more, from the TGM:

The report highlights a number of ways Canada can boost inbound foreign travel, including creating new products to meet changing demographics, investment in tourism businesses, attracting and retaining talent, reducing airline fees and taxes, as well as speeding up visa processing.

the reality is that many Canadian provinces (such as Ontario, Alberta, British Columbia, and Nova Scotia) have incredibly robust tourism departments that already are doing many of these recommendations. 

However, at the national government level, it's not a surprise that the government is doing less, because conservative governments tend to not favor investing in tourism promotion.  This has been a problem in the US for many years, although has finally been addressed through the development of the Brand USA program. 

Some of these elements, such as how visitors enter the country at airports is a real problem in the DC region at Dulles International Airport and across the country ("Customs lines delayed by hours at some big airports," USA Today).

In any event, this report is provocative and hopefully will be a wake up call to local jurisdictions about considering and addressing international tourism more directly as an element of local economic development strategy and policy.