Tourism Grows as Foreign Visitors Take Advantage of Cheap Pound

Big Ben London - sborisov/iStock/Getty Images Plus/Getty Images
Big Ben London // Photo by sborisov/iStock/Getty Images Plus/Getty Images

by Tim Wallace, The Telegraph, March 24, 2017

British hotels, restaurants and shops are benefiting from a jump in visits from foreign tourists, who are coming to the UK to make the most of the weak pound.

The rise in tourism is a corollary of the improvement in exports that economists hope will support the economy through any turmoil in the Brexit process.

Sterling dropped by around 15pc against the currencies of the UK’s major trading partners following the referendum vote to leave the EU, making British goods cheaper abroad and boosting the profits of exporting companies.

Just this week the Bank of England said that the  businesses it speaks to were reporting stronger levels of demand from tourists visiting the country.

More than 2.8m overseas residents visited the UK in January, up 11pc on the same month a year ago, the Office for National Statistics said.

The average visitor also spent more in the UK than they did before the pound fell, splurging a total of £1.5bn, a rise of 15pc on the year. This equated to an average of £536 per person visiting, up 6pc.

“The data from the ONS indicate that the sharply weakened pound is encouraging more visits to the UK from abroad and more spend by visitors,” said Howard Archer, chief UK and European economist at IHS Markit.

“This is especially true of North America, which ties in with the pound’s fall being most pronounced against the US dollar.”

The vast majority of visitors to Britain come from Europe - 2.2m of the 2.8m in January - while 240,000 came from North America and 460,000 from the rest of the world.

Over the three months to January compared with the same period a year earlier, visits from North America were up 19pc and those from Europe up 13pc.

Holidays account for a large proportion of the increase in visitors, rising 22pc compared with a 5pc growth in business trips, above the numbers made in the three months to January 2016.

The number of British residents taking trips abroad continued to rise in line with strong consumer confidence and spending levels, despite the fall in sterling. A total of 4.6m Brits went abroad in January, up by 9pc.

However the impact of the weak pound appears to be making itself felt in the amount spent while on holiday or on business trips.

The average UK resident travelling abroad spent £561 in January, down almost 3pc on the same month a year ago.

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This article was written by Tim Wallace from The Telegraph and was legally licensed through the NewsCred publisher network. Please direct all licensing questions to [email protected].