A Look At Countertrade In Tourism

A Look At Countertrade In Tourism
Tuesday Barter Report, December 1, 2009

International tourists are now counted each year in tens of millions, and tourism is today the largest single industry on earth. Huge investments have been made globally in hotels catering to foreign visitors. With the economic difficulties affecting these countries, the problem is how to fill hotel rooms to the point where these investments remain viable.

Many national tourism authorities are using countertrade to expand their business opportunities. For example:

· Canadian farmers supplying barley to a U.S. customer were offered trips to Las Vegas in exchange.

· A chain of spa hotels has been constructed in Hungary by an Italian company with partial payment in vacations and holidays at the hotels.

· To pay for gas piped from Russia, Turkey has considered setting up tourist parks with hotel complexes in Yalta and Baku.

· Cuba has set up a tourist enterprise, Cubanacan SA, to develop organized tours, seaside vacations, and congresses. The hard currency earnings will pay for the foreign expertise to increase hotel capacity and occupancy.

· Cuba also signed contracts with certain countries to construct eight hotels at Varadero, in exchange for sugar, tobacco and nickel.

· India has offered tourism packages on its list of exports available for countertrade deals.

· Egypt once paid for television receivers, supplied by a Japanese company, with tourism for Japanese nationals.

The major advantage of this form of countertrade is that it gives these countries the opportunity to sell their tourism in Western countries where they do not possess effective marketing access.