Econostrum | Economic News in the Mediterranean

Is happiness the Mediterranean’s largest economy?

By Étienne Pauchant, Founder President of Mediterranean Travel Association (Meta)

Written by Étienne Pauchant on Monday, November 26th 2012 à 22:21 | Read 1774 times


Is happiness the Mediterranean’s largest economy?
‘shorter’, ‘closer’, ‘cheaper’ and ‘less frequent,’ were the four watchwords in store for European holidaymakers in 2012, favouring domestic travel... ”

Despite twenty international summits organised in haste for four years, whose results were all reported as successful, the financial crisis imported from the USA in 2009, which is ravaging the European Union, shows no signs of abating.
Rather, new emergencies have arisen in 2012; there’s Greece, obviously, whose exit from the euro zone is now less likely, but also Spain, where banks are threatened with bankruptcy, which could have a domino effect on other banks and other States in a premature unravelling of sixty years of European construction.
Until early September the weak euro favoured Europe as a destination for overseas visitors. It only recovered after the ECB’s decision on its new programme to redeem government bonds. Despite the weak euro up until September, the Maghreb has performed well in 2012, and should benefit from a strong euro this autumn.

We’re not there yet, but the financial ruin of small savers still threatens, as well as lower wages, pensions, and job losses. Of course, there will be short-term stimulus, attempting to reconcile austerity and extravagance, like trying to put a square peg into a round hole. There is little chance that this strange coupling will find a solution, knowing that the saviour that is federalism is, for now, and until December, out of reach.

In this context, ‘shorter’, ‘closer’, ‘cheaper’ and ‘less frequent,’ were the four watchwords in store for European holidaymakers in 2012, favouring domestic travel or for the wealthier, travelling closer to home in Europe and the Mediterranean, continuing the trend already observed in 2011. The European currency, which traded in June 2012 at around US$ 1.25, will have attracted international holidaymakers to the continent, often new tourists, from fast-growing countries that have benefitted form the subsequent lower prices. The results for 2013 will largely depend on economic developments in the euro zone, the world’s biggest incoming and outgoing tourist destination.


Stress is also good for tourism

Tourism is a very resilient activity. It is directly related to the level of stress measured in the target market. The greater the stress, the greater the need for a break. The results of tourism in the Mediterranean in 2011 are proof of this (up 2.4% of international arrivals). Despite the warnings and bad omens, all of which predicted a sharp decline. It will probably be the same in 2012.

These results only relate to holidays abroad, which are deemed more expensive (this is less true in the Mediterranean), not leisure travel to domestic destinations, which are poorly assessed globally, and are well above departures abroad. The top German destination is Bavaria, second is the Baltic Sea and Spain ranks only third. The top holiday destination for the French is France, as Italy is for the Italians, Spain for the Spanish etc... In 2011, Atout France calculated 23 million holidays abroad by French people compared with 180 million trips “home” for personal reasons.

We must admit that extreme competition among industrial companies in this period of global economic crisis is a major stress factor, increased further by the new global world, which electronically connects three billion humans in a never-ending conversation. The need for calm and a holiday shared with family, friends and peers is even more important.


Follow the demands of the market

Knowing that a decline is not on the cards, some researchers very close to META* plan to complement the “development” indicators of nations with “happiness” indicators where, in line with initiatives taken by the UN and the OECD, which has embarked on a process of measuring well-being and progress where development indicators, including GDP, are undermined. If the work-life balance is one of the factors of well being, no one has (yet) proved that holidays contribute to happiness.

Travelling abroad and tourism do not bring peace, but can only develop in peaceful countries. It stops immediately if there are health scares such as SARS or the false alarm over swine ‘flu. It flees natural disasters and of course is totally averse to mass hysteria and worse, physical attacks.

Mediterranean destinations have been quick to understand their interest, to follow the demands of the market, anticipating them by broadening their price ranges to capture a portion of the budget. Tourism is now recognised by everyone as a major player in the economy of the Mediterranean and its strong capacity to generate employment. Countries that are not yet on the tourist map, such as Algeria (huge potential) and Libya, are preparing to “enter tourism” to increase the happiness of their future guests.

*Robert Lanquar in « le tourisme fait-il le bonheur des nations ? » Cordoue octobre 2012


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