Market Report
Caribbean Market Report 2019
The Caribbean, celebrated for its idyllic islands and year-round tropical climate, has long been synonymous with paradise for travellers worldwide. Known for its pristine white sandy beaches and tranquil environment, the region is a premier destination for relaxation, outdoor activities, cultural festivals, and historical exploration.
The Caribbean comprises various island nations and territories, including dependencies of the UK, US, France, and the Netherlands, housing around 42.5 million people across approximately 700 islands, of which about 100 are permanently inhabited.
Economic Significance of Tourism
Tourism is the backbone of the Caribbean economy, accounting for approximately 15% of the region’s annual GDP, making it the most tourism-dependent area globally. This sector has outstripped agriculture as the primary economic driver. Due to geographical disadvantages, such as higher transport and trading costs, inbound tourism has become a crucial income generator for the region. Local governments actively support tourism through fiscal incentives, fostering an investment-friendly climate.
Key Market Performance Indicators
- Tourist Air Arrivals (2018):
- Dominican Republic: 6,568,888
- Cuba: 4,807,000
- Jamaica: 2,472,727
- Puerto Rico: 1,760,000
- Bahamas: 1,663,136
- Aruba: 1,087,000
- Cayman Islands: 463,001
- US Virgin Islands: 477,840
- Occupancy Rates (2018):
- Cayman Islands: 78.9%
- US Virgin Islands: 82.0%
- Dominican Republic: 77.5%
- Jamaica: 77.0%
- Aruba: 77.2%
- Puerto Rico: 77.1%
Visitor Arrivals and Spending
The Caribbean maintained a 2-3% share of global tourist arrivals over the past four decades. In 2018, air arrivals decreased by 2.3% due to the impact of hurricanes Irma and Maria but rebounded significantly in the last quarter. The region expects a 6-7% increase in arrivals for 2019. US travellers remain the largest inbound market, followed by Canadians and Europeans. Emerging markets such as Russia and Brazil are also becoming increasingly important.
- Tourist Spending (2018): Despite a slight contraction of 1.0% in visitor spending, high construction activity in the upper upscale and luxury hotel segments indicates a positive outlook for tourism revenue.
Hotel Industry Performance
- ADR (Average Daily Rate): Increased from $205 to $208.
- RevPAR (Revenue per Available Room): Reached $136.
- Occupancy: Decreased from 66.7% to 65.3%.
- Room Supply: A modest increase, with a 2.1% rise recorded in Q1 2019 and a 3% expected by the end of the year.
Construction Pipeline
The region has a robust pipeline of over 27,300 rooms in various stages of development, with significant projects in the Dominican Republic, Jamaica, and Cuba. Major hotel chains such as Marriott, Hilton, and AMResorts are leading the expansion, focusing on luxury, upscale, and upper-upscale segments.
Key Developments by Hotel Chains
- Marriott International: 17 properties with 3,111 rooms.
- Hilton Worldwide: 12 properties with 3,140 rooms.
- AM Resorts: 8 properties with 2,232 rooms.
- Hyatt: 7 properties with 2,021 rooms.
- Accor: 5 properties with 818 rooms.
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