US Travel and Tourism Industry Accounts for 2.5% of GDP
Number of Visitors Down 12% in March... Largest Drop Since the Pandemic
As the Trump administration tightens immigration enforcement, measures such as denial of entry, arrest, detention, and deportation of tourists visiting the United States have emerged, leading to a phenomenon where travelers, concerned about these actions, are avoiding visits to the U.S.
On the 12th (local time), the British daily Financial Times (FT) reported that the U.S. International Trade Administration (ITA) revealed that the number of Western European visitors who stayed at least one night in the U.S. in March this year decreased by 17% compared to March last year. Visitors from Denmark and Iceland dropped by more than 30%, while visitors from Germany, Ireland, Spain, and Norway decreased by over 20%. During this period, the total number of overseas visitors to the U.S. fell by 12%. This is the largest decline since the COVID-19 pandemic impact in 2021.
Last week, French hotel giant Accor also announced that bookings for U.S. trips by European travelers this summer have decreased by 25%. Adam Sacks, head of tourism research firm Tourism Economics, said, "Clearly, something is happening. This is a reaction to Trump." He pointed to President Trump's aggressive rhetoric toward the European Union (EU), Greenland, and Canada, noting, "These things have a significant impact on foreign sentiment toward the U.S. and affect travel."
The tourism and transportation industries attribute this mainly to the Trump administration's border tightening policies and the country's "reputation." Since the start of Trump's second term, U.S. entry screenings have been strengthened, and there have been numerous reports of travelers from Canada, Germany, France, and other countries being detained or denied entry when attempting to enter the U.S. It is also reported that during the screening process, applicants' mobile phones and social media accounts are being checked, with increasing cases of detention and deportation.
Experts are concerned that the decline in overseas visitors could have serious long-term effects on the U.S. economy. Travel and tourism account for 2.5% of the U.S. Gross Domestic Product (GDP), making it a major industry. According to the ITA, overseas visitors spent $253 billion (360 trillion won) on tourism-related goods and services during their trips to the U.S. last year. Additionally, including indirect service jobs such as hotel staff and taxi drivers, about 15 million jobs were created. Canadian travelers, who make up the largest portion of annual U.S. visitors, spent approximately $20.5 billion (about 29.6 trillion won) last year alone. A 10% decrease would result in a loss of $2.1 billion (about 3 trillion won). Currently, airline bookings on the Canada-U.S. route have dropped by about 70% compared to the same period last year. This is a massive decline compared to airlines' 3.5% reduction in flights.
Paul English, founder of the travel website Kayak, warned, "In just two months, (Trump) has damaged America's reputation," adding, "This is not only a blow to the U.S. economy but also a reputational damage that could take generations to recover."
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