Iran Records 41% Increase in Foreign Tourist Arrivals

EghtesadOnline: A total of 2,030,523 tourists visited Iran during the first quarter of the current fiscal year (March 21-June 21) to register a 41% growth compared with 1,443,551 inbound tourists during the same period of last year, the Persian daily Donya-e-Eqtesad reported.

News ID: ۷۴۷۹۵۳

23 July 2019

While the US State Department has long issued strong advisories against traveling to Iran and despite tensions between the two countries, tour operators and travel mavens such as Rick Steves maintain that Iran is a safe and hospitable destination for travelers, Americans included.

The available tours, which include everything from culinary themes to women-only sojourns, are intriguing options for travel advisors to recommend to clients looking for new cultural experiences, New York City-based media company Skift wrote recently.

Tour operators who spoke with Skift strongly disagree with the US State Department’s warning that Iran is not a safe travel destination, maintaining that Iran has proven to be a safe and remarkably hospitable place for travelers, including Americans. The biggest obstacle they see is the widespread misperception that the country is not safe or that visitors will be met with hostility, Financial Tribune reported.

According to the 2019 Travel Risk Map, launched by global risk experts International SOS in collaboration with Control Risks, Iran is as safe as a majority of European countries when it comes to travel security.

A majority of European countries are deemed low risk, including the UK, as are Iran, Jordan, Oman, Qatar, the UAE, Kuwait, Georgia, Azerbaijan, Armenia and Uzbekistan. Canada, the US, Australia and New Zealand are all low risk, too.

According to International SOS, a low travel security risk means violent crime rates are low and racial, sectarian or political violence or civil unrest is uncommon.

“Security and emergency services are effective and infrastructure is sound. Industrial action and transport disruption are infrequent,” the company said in a blurb on its website in reference to "low risk" countries.

Decline in Outbound Tourism

A total of 1,759,749 Iranians traveled overseas in the quarter ending June 21, indicating a year-on-year decrease of 6.5%.

As many as 660,000 tourist departures were recorded in the first month of the current year (March 21-April 20), indicating a 25% year-on-year decline.

The second fiscal month that ended on May 21 saw a 4% decrease in the number of departures compared with last year’s same month.

Nonetheless, a year-on-year growth of 23% was posted in the number of departures in the third month of the year (May 22-June 21) compared with the same period of last year.

The devaluation of Iran's national currency rial against foreign currencies last year has had a dual effect. On the one hand, it led to a decline in the purchasing power of Iranians overseas. On the other, it has given a boost to the inbound tourism sector, as travelling to Iran has become cheaper for foreign holiday-goers.

The rial lost about two-thirds of its value against the dollar last year. In recent weeks, however, the national currency has gained parts of the losses by appreciating against foreign currencies.

The once international travelers have either switched to domestic destinations or left traveling outside of their leisure activities.

Downturn in Travel Agencies' Business

The decline in outbound travel has resulted in a significant number of travel agencies’ closures, as well as suspension of activities and downsizing of others.

“One of the shortcomings in Iran’s tourism industry is the government’s granting of work permits to travel agencies without taking into consideration the number of inbound and outbound tourists. Less than 5% of travel agencies in Iran are active in organizing inbound tours whereas 95% of them have focused on outbound tourism,” the head of Travel Agents Guild Association, Hormatollah Rafiei, said.

To tackle this problem, the association has decided to set up a committee tasked with curtailing the number of travel agencies’ closures by channeling them into conducting more inbound tours.

“In two months’ time, between 30 and 50 agencies are going to direct their activities toward attracting tourists from 10 countries, including Iraq, Afghanistan, Turkey, Pakistan, Turkmenistan, Georgia, Armenia and China, among others,” Rafiei added.

WTTC's Report

The World Travel & Tourism Council's latest report shows Iraq was the main source of tourism for Iran in 2018, as Iraqis constituted 24% of all inbound visitors.

Other major sources were Azerbaijan (17%), Turkey (8%), Pakistan (4%) and Bahrain (2%). The remaining 46% came from the rest of the world.

As for departures, Turkey was the most popular destination, accounting for 41% of all visits abroad.

It was followed by Iraq (18%), UAE (11%), Syria and Armenia (4% each). The remaining 22% went to other parts of the world.

WTTC's review of tourism spending in Iran in 2018 shows 93% of visitors spent for leisure purposes while 7% spend for business purposes.

The council ranked Iran 20th from among 185 countries in its 2017 power ranking, which evaluates countries in terms of absolute size growth measured in US dollars in the field of travel and tourism.

The latest WTTC’s new Power and Performance report, published in September, looks at the performance of all countries over the seven years from 2011 to 2017.

The power ranking shows that Iran’s travel and tourism share in its total GDP grew around $10.4 billion over the seven-year period, which shows the 19th biggest growth from among the 185 countries under study.

The figure rose to $30.7 billion in 2017 (accounting for 7.3% of Iran’s total generated GDP that year), which positioned Iran in the 35th place.

Domestic spending, which is the money spent by residents of a country for both business and leisure trips taken inside the country, had the lion's share of all tourism expenditure and the remaining 21% belonged to international spending.

While money from domestic tourism is not new money to a country, its use in terms of informing residents of countries’ natural and cultural attributes and engendering a source of pride is essential for social harmony, according to WTTC.

Iran's travel and tourism sector grew at 1.9% to contribute 1,158 trillion rials ($8.83 billion) or 6.5% of overall GDP and 1,334 jobs (5.4% of total employment) to the economy in 2018, the council's new report shows.

The WTTC report also shows international visitors spent 168,954 billion rials ($1.28) in Iran in 2018. The council expects the number of international arrivals to stand at 6.5 million in 2019.

Tourism as Economic Savior

Iran is hoping to attract up to 1 million Chinese tourists from August to shore up its economy, hit by US sanctions.

Vali Teymouri, Iran's deputy director for tourism affairs, told South China Morning Post that the Iranian government’s new visa waiver program for Chinese visitors—first announced in June—could be implemented as early as the end of July.

Teymouri said Iran expected to “attract 1 million Chinese in the near future” through the visa waiver, a significant increase on the more than 52,000 Chinese who visited the Middle East country in 2018.

“We believe that the two countries have had common cultural and trade communications for a long time. So we should facilitate and improve mutual collaborations, especially in the tourism industry,” he said.

IRNA reported late June that the Iranian government had passed a regulation to cancel visa formalities for Chinese nationals, at the suggestion of the country's Foreign Ministry and the tourism agency, Iran Cultural Heritage, Handicrafts and Tourism Organization.

Ali Asqar Mounesan, the head of ICHHTO, said the decision was “an effective step” to help increase the number of Chinese tourists and “we want to host 2 million tourists from China each year”.

The move is aimed at increasing the number of Chinese people who want to visit Iran and raise the government’s non-oil revenues.

“We should believe that the tourism industry is [capable of] generating more income than the oil industry, and that sanctions do not work in the tourism sector,” Mounesan was quoted as saying in the IRNA report in June.

“We believe the two countries have had common cultural and trade communications for a long time. So we should facilitate and improve mutual collaborations, especially in the tourism industry,” he declared.