USA Slump in overseas visitors the curse of a strong dollar By Johanna Jainchill / September 11, 2017 Share 1 Photo Credit: Shutterstock -- International visitation to the United States is forecasted to contract this year, continuing a decline that began in 2016 following six straight years of growth. The strength of the dollar is widely thought to be the main obstacle to inbound travel. Since 2014, it has increased 18%, reaching its highest level since 2002. That was compounded by the weak British pound, which fell to a 31-year low after the Brexit vote in June 2016, and by currencies falling to record lows last year in Canada and Mexico, the top two inbound markets overall. "The biggest single thing that affects the travel landscape right now is the ongoing strength of the dollar in the markets we're active in," Brand USA CEO Chris Thompson told Travel Weekly earlier this year. The downturn has prompted Brand USA to push back to 2023 its initial goal of 100 million international visitors by 2021. Before 2016, international inbound travel had grown every year since the recession ended, reaching a record 77.4 million visitors in 2015. That number fell 2.4%, to 75.6 million, last year.This year, the numbers could be worse. The U.S. Travel Association downwardly revised its previously reported inbound travel numbers last week, based primarily on Department of Commerce data from the first quarter indicating that arrivals between January and March were down by 4.2%, to 15.8 million visitors.The Commerce numbers supported U.S. Travel's earlier prediction that there would be a drop-off in inbound travel in 2017. The organization was surprised when there was a slight inbound travel uptick last April, but it now says that was due primarily to the travel-heavy Easter holiday falling in April instead of March.Commerce also reduced its international visitor spending estimates by $1.4 billion for the first six months of the year: Instead of increasing 2.6%, it estimates international visitor spending edged up just 0.7%."A lot of that is a dollar story," said David Huether, senior vice president for research at U.S. Travel. "That's been the driving factor. ... Some markets like Brazil haven't been stellar. ... This issue has not just affected travel. It affected exports in general throughout most of last year." Nick Hentschel, vice president of business development at American Tours International (ATI), said 2017 has been solid for his company, but he allowed that currency issues had affected certain product lines. "Much longer escorted tours, because of the big bulk cost, are not performing as well this year as in the past," he said. "Particularly from the U.K."The value of the dollar has been falling this year, hitting a 15-month low in July, a potential bright spot for inbound travel though not for the U.S. economy overall. This has already helped the Canadian source market, where visits fell 6.8% in 2016, when the loonie reached its lowest relative values since 2003. In the first quarter, Canadian visitors increased 5.1% as their currency strengthened, reaching its strongest position since 2015. Still, U.S. Travel CEO Roger Dow said the ominous forecast should spur action on the part of the administration. "Inbound travel to the U.S. already went through one 'lost decade' after 9/11," Dow said. "It took a sustained national policy effort to return to the pre-9/11 level of travel exports, which only happened last year. If we don't want to give back all of that progress, the time to act is now."Dow called for the White House to "help right the ship" by continuing the Brand USA marketing organization and by protecting policies that enable international travel to the U.S., such as open-skies agreements and the Visa Waiver Program.Visa policies are particularly important to the Chinese market, which grew to nearly 3 million visitors in 2016 despite the strong dollar, a 15% increase over 2015. However, Lin Wang, the National Tour Association's (NTA) director of China market services, said there are growing concerns about visa application issues. "While other countries are making it easier for Chinese travelers to apply for visas -- for example, Canada plans to establish more visa processing centers in China -- it seems the United States government is doing the opposite," Wang said, adding that several NTA members reported higher visa denial rates this year, and visa appointment waiting times of more than 20 days "discourage the Chinese traveler" from wanting to visit the U.S.Threatening rhetoricMany tourism leaders also blame the political rhetoric out of Washington for contributing to an already difficult situation. New York, for example, has been trying to soften the currency issue by featuring "countless free and affordable attractions, museums, parks and more" in its global messaging, as well as a "Free in NYC" guide on its website. But its tourism marketing organization, NYC & Company, is more concerned about rhetoric than currency. When it predicted that its international visitor numbers would drop for the first time since 2008, NYC & Company took aim at the Trump administration. "We know currency exchange always has an effect on travel decisions, [but] the modification of our original forecast to be a decline of 300,000 was due to the political rhetoric about the travel ban in particular and the lack of a welcome message to our international visitors on behalf of the Trump administration," said NYC & Company spokesman Chris Heywood. He added: "The competition for the same tourism dollar is fierce, and having this extra layer of rhetoric doesn't help us."Mexico might be the market most affected by the political climate, starting with Trump's disparaging remarks about Mexicans during the campaign, his continued call to build a wall along the border and recent tweet calling Mexico "one of the highest crime nations in the world."Visitors bureaus from New York to California have sent delegations to Mexico to roll out the welcome mat, but NYC & Company still predicts that Mexico visitation will drop 6.7% this year, more than any other international market. Without attributing it to anything specifically, Intrepid Travel said it has seen a 24% decrease in bookings to the U.S. in 2017 compared with 2016, the biggest decrease coming from the Australia market, which is down 27% in 2017. The company also saw a big drop in Australia bookings to the U.S. as far back as 2015. Intrepid Group regional director Leigh Barnes said that the National Park Service's 2016 centennial created buzz for the U.S. last year, but that even with the solar eclipse giving a slight boost to August, "bookings to the U.S. are down across the board." "We are optimistic that this trend can and will turn around," Barnes said. "While the U.S. government has been the source of a lot negative media attention this year, the travel industry must continue to stand for open borders, inclusivityand the celebration of diversity."