Tourist board: U.S. arrivals up over 17%

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REYKJAVIK -- The Icelandic Tourist Board reported a 17.7% increase in U.S. tourists January through August this year compared with 1999, with arrivals increasing from 31,775 to 37,411.

The count, which was revealed at the Vestnorden Travel Mart here in September, included those visitors who stayed at least one night at a hotel or guesthouse.

"This is our ninth consecutive year of tourism growth to Iceland from North America. There has not been a hiccup," said Einar Gustavsson, director, the Americas, for the Icelandic Tourist Board in New York.

Magnus Oddsson, director general of the Icelandic Tourist Board here, added, "We like to think that it has to do with our promotional work, and that Icelandair has increased its promotional work, as well.

"Then, of course, we have a strong U.S. dollar, and we see from our surveys that Americans like our product."

Oddsson said that the tourist board projects an average annual increase of 10% from the U.S. market during the next few years.

Accompanying the increased exposure and demand, Gustavsson said there also has been a dramatic change in the number of tour operators and wholesalers selling Iceland.

"Five years ago, there were about 25 tour operators. This year, there are approximately 200 more," he said.

This year's Vestnorden Travel Mart, the travel trade show for Iceland, Greenland and the Faroe Islands, had participation from about 140 companies as wholesalers or exhibitors and 115 as buyers or tour operators, according to the Icelandic Tourist Board.

Iceland's overall tourism increase of 18%, Oddsson said, "means that for the first time tourists exceed Iceland's population," which is 279,000.

The tourist board previously forecasted 300,000 tourist arrivals by 2003.

"Tourism in Iceland is being taken more seriously than ever before by the government," Oddsson said.

Tourism is Iceland's second-largest foreign currency earner after fisheries, providing 13% of the country's income and 3.6% of the gross national product.

Oddsson warned that tourism for the country as a whole could be hurt if the insufficient hotel capacity in the capital city is not corrected.

"We could be facing, in the next two to three years, a shortage of hotel accommodation in Reykjavik," he said.

"Although tourism is growing fast, investors can get more for their money elsewhere. This would be bad for tourism throughout Iceland, as Reykjavik is the distribution center for the whole country."

The tourist board's projected visitor count of 350,000 in 2005 could conceivably be accommodated without building new hotels, Oddsson said.

"But we are now already passing 300,000 this year, so with the same increase in the next five years as the last five years, we could not [meet demand] without new hotel investments," he added.

One factor that might spur hotel investment in Reykjavik in the near future is the development of a harborside conference center, which was announced to the travel industry at the start of the Vestnorden Travel Mart.

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