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International travel and passenger fares, 1987.

International Travel and Passenger Fares, 1987 THE U.S. travel and passenger fare deficit increased 14 percent to $9.9 billion in 1987 (table 1). Travel and passenger fare payments of U.S. travelers abroad were $29.3 billion, up 18 percent. Receipts from foreign visitors to the United States for travel and passenger fares were $19.4 billion, up 21 percent.

The year 1987 evidenced a resurgence in U.S. travel abroad, particularly to Europe, after a marked decline in 1986. Terrorist incidents had depressed travel during the peak mid-summer travel season in 1986. Over 6 million U.S. travelers visited Europe in 1987, up 20 percent, despite continued depreciation of the dollar against most major European currencies. The number of foreign visitors to the United States from overseas was up 18 percent to 10.4 million, as continued dollar depreciation encouraged travel to the United States. Visitors from Europe and Japan accounted for most of the increase (chart 3).

Payments of U.S. travelers for travel abroad and receipts from foreign visitors for travel in the United States each increased 19 percent, to $20.5 billion and $14.8 billion, respectively.

U.S. payments to foreign carriers for transportation to and from the United States increased 18 percent to $8.8 billion, largely due to an increase in the number of U.S. travelers to Europe and the Pacific. Forty-four percent of all U.S. citizens' departures were on foreign carriers, compared with 46 percent in 1986. For departures to Europe, the percentage fell to 48 percent from 50 percent. Receipts of U.S. carriers from foreign visitors for transportation to and from the United States increased 28 percent to $4.6 billion. Forty-one percent of all foreign visitors used U.S. carriers, compared with 38 percent in 1986.

U.S. travel abroad

Overseas.--U.S. travel expenditures overseas increased 28 percent to $13.6 billion in 1987. Expenditures increased in all geographic areas, particularly in Europe and in South America, which were up 41 percent and 33 percent, respectively (table 2). The total number of U.S. travelers overseas increased 13 percent in 1987.

Travel expenditures in Europe soared to $7.5 billion from $5.3 billion; the number of U.S. travelers increased over 1 million to 6.2 million (table 3). Much of the increase in the number of travelers occurred in the spring and summer, largely reflecting a recovery from levels that had been depressed by terrorist incidents in 1986.

Travel expenditures in South America increased 33 percent to $0.6 billion; the number of travelers increased 23 percent. The dollar strengthened considerably against most major South American currencies, but double- and triple- digit inflation in most of those countries more than offset the appreciation.

Travel expenditures in the Caribbean and Central America increased 9 percent to $2.3 billion; the number of travelers increased 6 percent. The currencies of many Caribbean countries are pegged to the dollar, so travel expenditures were not affected significantly by currency changes.

Travel expenditures in "Other areas," primarily the Far East, increased 16 percent to $3.2 billion. The number of travelers increased 7 percent despite continued depreciation of the dollar against the currencies of the major destination countries (Japan, Australia, and New Zealand).

Canada.--After years of steady, double-digit growth, U.S. travel expenditures in Canada decreased 3 percent to $2.9 billion in 1987. The decrease was entirely due to a decline in the number of travelers, mainly auto travelers in the spring and summer. Auto travel to Canada had increased 12 percent to a record level in 1986, partly because of the Vancouver Expo.

Mexico.--U.S. travel expenditures in Mexico increased 10 percent to $3.9 billion. Travel expenditures in Mexico's border area increased 3 percent, and expenditures in the interior increased 21 percent. Heavily advertised bargain air and hotel packages were probably a major factor, as the number of U.S. travelers to Mexico by air increased 23 percent to just under 3 million. Although the average cost of the Mexican peso fell 56 percent for U.S. travelers, the Mexican inflation rate of 132 percent was more than offsetting.

Foreign travel in the United States

Overseas.--U.S. receipts from overseas visitors increased 21 percent to $9.5 billion (table 4). An 18-percent rise in the number of visitors accounted for most of the increase (table 5). Continued dollar depreciation against many currencies made the United States and especially attractive destination. Receipts from all geographic areas increased; receipts from Western Europe showed the strongest growth for the second consecutive year. Receipts from "Other areas," primarily Japan, strengthened considerably.

Travel receipts from Western Europe increased 30 percent to $3.8 billion, accounting for 40 percent of all overseas receipts. The number of European visitors increased 25 percent to 4.7 million. Continued appreciation of the currencies of most major European countries against the dollar encouraged European travel to the United States.

Travel receipts from other areas also increased. Receipts from the Caribbean and Central America increased 15 percent to $0.8 billion; the number of visitors increased 12 percent. Receipts from South America increased 4 percent to $1.2 billion; the number of visitors decreased 1 percent. Receipts from "Other areas," primarily the Far East, increased 20 percent of $3.7 billion. The number of visitors increased 16 percent, compared with a 9-percent increase in 1986. For visitors from Japan, the origin of the largest number of overseas visitors, the average cost of a U.S. dolalr fell 17 percent.

Canada.--After 3 years of essentially unchanged U.S. receipts from Canadian travelers, receipts increased 21 percent to $3.3 billion in 1987. The increase was due to a 19-percent rise in auto travel and a small increase in average expenditures. The rise in auto travel was encouraged by a 5-percent depreciation of the U.S. dollar against the Canadian dollar.

Mexico.--U.S. travel receipts from Mexico increased 5 percent to $2.0 billion. Receipts in the U.S. border area were up 1 percent to $1.6 billion. Receipts in the U.S. interior were up 19 percent to $0.5 billion, largely due to a 15-percent increase in the number of Mexican visitors. The increase in visitors occurred even though the cost of U.S. travel, in terms of the Mexican peso, more than doubled from the previous year.
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Author:Kealy, Walter G., Jr.
Publication:Survey of Current Business
Date:May 1, 1988
Words:1069
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