Alfonso Sumano Lazcano on gutting of Mexico tourism promotion

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Last week, Alfonso Sumano Lazcano, head of the Mexico Tourism Board's New York office, confirmed months-long rumors that the government planned to shut down the board, which promotes inbound tourism. Its budget will be used to build a train on the Yucatan Peninsula. Senior editor Jeri Clausing talked with him about the move and what it could mean for Mexico and the many companies with a huge stake in selling travel to Mexico.

Q: We've been hearing for months that the new administration wants to shut down your agency and revamp or eliminate the promotion of inbound tourism. Is that true?

Alfonso Sumano Lezcano
Alfonso Sumano Lezcano

A: Consejo (de Promocion Turistica de Mexico) is definitely shutting down. It's going to be something different. The good news is that they are going to maintain three offices: here in New York; one in Europe, in Berlin; and one more in Asia, based out of Tokyo. I wouldn't say we would stop promoting Mexico internationally. But we are standing by for now. 

Q: Is it also true that your budget (nearly $300 million a year) from the $15 tax on inbound airline tickets is going to be shifted to the train? 

A: Yes. The new president [Andres Manuel Lopez Obrador] is a leftist, and he is into providing people with social benefits. And that means he needs a lot of money. In this case, he is actually allocating to the train the funding that used to be used for tourism promotion for the train.

But to make the change, they need to pass a new law. It used to be that 70% of that tax went to Consejo, for the promotion internationally of Mexico; 20% went to Fonatur, the entity that is building the train; and 10% was for immigration.

What we are trying to do is convince them to do the opposite: give 70% or 80% to the train and give us 10% or 20% to do campaigns and participate in the most important events.

Q: Some reports in the Mexican press indicated that the change was not just about funding the train but was made out of concern that spending by the tourism board was not transparent. 

A: The tourism board could be much better in terms of communicating where they were investing the money. That definitely didn't happen in the past. But that doesn't mean that you have to reinvent the wheel. We can do some improvements and keep it very transparent. At the end of the day, even though it is not a tax that the Mexican taxpayer pays, this is public money. So it is a very good idea to have transparency.

Q: I understand that business leaders like Pablo Azcarraga (chairman of both the Mexican hotel chain Grupo Posadas and the Consejo Nacional Empresarial Turistico, the voice of Mexico's private tourism sector) are negotiating to try to salvage some funding for inbound promotions and create a private-public partnership. Are you working with them, as well?

A: We are in agreement. ... He is talking about a budget of about $150 million. The Consejo had $300 million. He is saying that even if we keep less than that, we can keep operating. They are talking about reducing all kinds of expenses. We can do something like that.

What we are trying to make people understand is that the international marketplace is very competitive. If they shut down promotion, there won't be money for the train or anything. In a couple of years, after you've had no promotion and travelers start to decrease, they will notice that the funds for the train will decrease, as well.

Q: It all sounds very up in the air right now. When do you think you might know what the future holds?

A: Whenever they approve the new legislation and we know how it reads. Then we are going to know exactly what is going on. I believe the minister of foreign affairs is going to push to have some resources [for promoting tourism]. He knows you can't just talk about it. I believe he will definitely be sensitive to the needs of tourism.

I hope to have much better information at Tianguis [trade show] in Acapulco in early April.

Q: In the meantime, what kind of immediate impact is this having?

A: The markets respond to what you did seven or eight months ago. I don't see a lot of decrease in tourism this year. But we need to keep on going. We need to keep moving. If you shut down promotion all at once it is not good.

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