Colombia: Turning to tourism
2012 was an exceptional year for tourism in Colombia and forecasts predict even better results for 2013. International visitors arrivals are expected to increase 6% this year, according to the Minister of Commerce, Industry and Tourism, but domestic tourism, which rose by 20% last year, is expected to lead expansion.
The strength of the industry is a result of several factors: a significant reduction in air fares; an improvement in car travel safety; the upgrade of hotel services and infrastructure; and greater tourism promotion.
The sector has seen international recognition of late. In early December 2012, Travelzoo, a tourism promotion website, chose Colombia as one of the top-five destinations for 2013, while a panel of British tour operators at London’s World Tourism Fair (WTM) had a month before placed Colombia first in the "Long Distance Emerging Destination" category. The recent arrivals of low-cost airlines Spirit in 2008 and Jetblue in 2010 and accelerated growth by two hotel groups. Marriott opened its first hotel in the country in 2010 and advanced the opening of a 180-room hotel in Cali in 2013 and a 278-room hotel in Cartagena in 2014, while Hilton inaugurated its hotel in Bogotá in November 2011 and announced expansion plans throughout Colombia.
Higher tourist arrivals have been encouraged by government incentives. Adriana Saavedra, general-director of the Colombian Tourism Promotion fund, told OBG, "The momentum of Colombia’s tourism industry is due, among other factors, to the incentives incorporated by Act 788 of 2002, including a 30-year tax-exemption for new or renovated hotel facilities.” Saavedra said this policy was unlikely to be renewed in 2014 so as to avoid market saturation.
Despite significant recent international recognition, Claudia Hoyos, general manager of Marca País, the institution in charge of the country’s brand positioning, told OBG that it is essential to promote Colombia not only internationally, but also domestically so Colombians can identify with the brand "Colombia" and everything it stands for. "If we fail to get our message to Colombians, it will be very difficult to sell Colombia internationally," she said.
To this end, Proexport, a government agency and consulting group, plans to organise more than 70 seminars in different regions of the country in 2013, with the idea of encouraging local business communities to create competitive tourism destinations in their respective areas.
The Ministry of Commerce, Industry and Tourism also announced a series of initiatives to encourage Colombians to travel in their own backyard. The “Travel Colombian” programme, unveiled in January, includes the creation of a “Youth Card” to allow citizens between 14 and 28 to travel at reduced rates. Sergio Díaz-Granados, the Minister of Commerce, Industry and Tourism, expressly invited local traders who attended the event to participate via partnerships with local government.
However, the sector faces numerous challenges, most importantly its level of formalisation. Díaz-Granados has said that 60% of the operators run “informally”, meaning they do not pay proper taxes or follow an employment code. As such, the ministry will soon implement a pilot programme to make tourism providers throughout Colombia aware of the benefits of formal operations, as well as to explain the penalties for non-compliance with the law. The plan will first go into effect in eight Colombian cities: Bogotá, Cartagena, Santa Marta, Pereira, Armenia, Coveñas, Medellín and Cali. “Formalisation teams” will work to help informal operators complete registration procedures in the National Tourism Registry and to explain the guidelines to which they must adhere.
Meanwhile, the remarkable growth in the flow of international tourists to Colombia is directly linked to the momentum of the cruise industry on the Caribbean coast. The coastal cities of Cartagena and Santa Marta received 192 cruise ships in 2012 and expect a total of 400,000 passengers to have visited the area by the end of the cruise season in May 2013, according to the Deputy Minister of Tourism, Oscar Rueda García. These figures represent an increase of more than 17% compared to the previous season.
The increasing popularity of Colombia’s Caribbean coast as a cruise destination has resulted in the country being picked to host the 20th Annual Conference of the Florida-Caribbean Cruise Association in late 2013. As a result, Colombia will now see the return of Disney Cruise Lines and Carnival Cruise Line Residensea, as well as the first arrival of ships from new operators such as Phoenix Reisen, Paul Gaugin Cruises and Kristina Cruises.
With a new focus on domestic tourists and increasing opportunities in the international cruise segment, the prognosis for sector development is very positive. Formalising smaller operators, however, will go a long way to the government’s ambition of turning tourism into a key sector for GDP growth.