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The Honolulu Advertiser
Posted on: Thursday, June 29, 2006

Hawai'i tourism industry still growing

By Lynda Arakawa
Advertiser Staff Writer

The state's tourism sector continued to benefit from rising visitor arrivals and spending last month, both of which appear on track to set another record this year despite a decline in the Japanese market.

The growth in the visitor industry this year has been a boon to companies like Maui Eco-Adventures, which increased its staff from about eight guides last summer to about 13 this year.

"We're staying busy," said office manager Kealy Pierce. "We're sending out all our vans everyday, and most days we're booked up completely."

The company, which offers hiking and other tours, has seen its business grow by about 30 percent to 40 percent in May compared to last year, Kealy said.

Most of Maui Eco-Adventures' customers are Mainland tourists, who continued to carry the industry last month.

Hawai'i hosted 576,996 visitors in May up 1.7 percent as Mainland visitor arrivals offset a double-digit decrease in Japanese visitors, according to preliminary data released yesterday by the state Department of Business, Economic Development and Tourism. Visitor expenditures rose 3.4 percent to $886.6 million, and total visitor days 4.97 million set a monthly record.

Visitor arrivals for the first five months of the year are running about 2 percent over the same period last year, and are on pace to set a record for the second year in a row. Visitor spending, up 6.6 percent through May, also is on a record pace. Last year, a record 7.46 million tourists spent more than $11.5 billion, a new high. DBEDT is forecasting arrivals and spending this year to rise to 7.64 million and $12.4 billion, respectively

Although arrivals and spending are rising, the rate of growth is beginning to slow. Most economists have revised their 2006 forecasts downward slightly, in part because of the decline in the Japanese market, said Leroy Laney, a Hawai'i Pacific University professor of economics and finance. Laney has revised his own visitor arrival forecast from 3 percent growth to about 2.7 percent.

"But it's still quite healthy, and we will set another record," he said.

May domestic visitor arrivals, up 3.9 percent year-over-year, set a monthly record despite a 1.1 percent drop in U.S. East visitors.

"May was another excellent month for Hawai'i's visitor industry," said state tourism liaison Marsha Wienert. "The economic impact of the visitor industry continues to provide for a healthy economic outlook for the state."

But Japanese visitor arrivals, which have declined every month this year, fell 10.9 percent in May as the market continues to struggle with airline fuel surcharges, fewer air seats and higher hotel room rates. But even with the decrease, total Japanese visitor expenditures grew 3.1 percent. Daily spending among Japanese tourists higher than any other major market grew 14.8 percent last month.

The Big Island saw the largest percentage increase in visitors with a 5.8 percent growth year-over-year, followed by Kaua'i at 3.9 percent and Maui at 3.2 percent. O'ahu saw 1.3 percent fewer visitors, and Moloka'i saw a 7.4 percent drop. Visitor arrivals to Lana'i were relatively flat at -0.4 percent.

Of the total number of tourists here this year through May, 153,119 flew here to board Hawai'i-based cruise ships or arrived via foreign cruise ships. That's up 34.3 percent from the same time last year.

Reach Lynda Arakawa at larakawa@honoluluadvertiser.com.

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