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Argentina isn’t the only tourism growth story in Latin America in 2018. But its culture and national brand help set it apart in a region that many international travelers tend to homogenize.
Argentina and other Latin American countries like Colombia, Mexico, and Peru have boosted their tourism investments in the past five years to grow their international arrivals. But Argentina is a stable beacon in an increasingly volatile region with economic shocks, political scandals, populism, energy crises, and violence in certain tourist areas. Argentina President Mauricio Macri, who took office in 2015, has enacted policies that have helped stabilize the economy.
Natural resources and agriculture have helped make Argentina Latin America’s second-largest economy, and government officials want tourism to play a larger role. Argentina’s international visitor spending was the third highest in the region in 2016 (4.4 billion), behind Mexico and Brazil, according to the World Travel & Tourism Council. Argentina invested some $6 billion in tourism in 2016 and its tourism investment is expected to grow about 3 percent through 2027, the WTTC estimates.
Skift recently interviewed Gustavo Santos, Argentina’s Minister of Tourism, in Mexico City at an invitation-only Skift Megatrends event to learn what’s on the horizon for Argentina’s tourism industry in 2018. Santos was appointed by Macri in 2015 and has held various government, tourism, and private sector positions throughout the country for the past 30 years. He most recently was the president of Córdoba, Argentina’s tourism board.
He spoke about the importance of attracting more flights, including from low-cost carriers, and expressed his hope of one day seeing the implementation of a Latin America-wide reciprocal visa system.
Following is an edited version of the interview.
Skift: It’s been two years now since you’ve been the Minister and obviously, you came from the private sector and trying to do a lot of changes to the tourism sector in Argentina. What’s the big focus in 2018 for you?
Gustavo Santos: The main obsession is flight connectivity. The main aim that a successful of this government is to call new companies to come to Argentina and start flying. Important players, like Norwegian, are appearing. Now Norwegian is also an Argentine company. They positioned themselves in Argentina. They will fly internally as well as domestic. And regionally and, of course, internationally. It’s an investment of around $430 million U.S. dollars. The main aim for this year is to consolidate the main markets that send tourists to Argentina.
Skift: So the main market has been Brazil internationally, right?
Skift: How do you want to change that?
Santos: Tourism works through proximity. Brazil is our neighbor. So it’s a big market and it’s our main client, and customer, as well. We’re the first option for Brazilians to travel but the Brazil market decreased a lot in the last few years.
Skift: The markets that you’re trying to expand into are European markets. What type of tourist are you trying to get? Upscale or midscale? Is it because you’re using these low cost airlines to come to Argentina? What type of tourists are you thinking about? Upscale or mid-scale or?
Santos: European travelers are high end for Argentina. We have to consolidate this kind of clientele in these markets. Such as Switzerland and others. But in order to increase still more, we have to attract other markets. And for these, we need low-cost airlines.
Skift: What about the U.S.? How big of a market is the U.S. for you? Do you see a lot more flights coming from the U.S.?
Santos: It is very important. Today it’s our third market in terms of important after Brazil and Chile. But in air arrivals is the second market. It has increased two digits in the last two years. We took two important decisions. First, we removed the reciprocity tax that Argentina used to charge to Americans. It was like $150 that we took away from our customers. Also we returned the VAT, the 21 percent of the accommodation. These two decisions were very important, but the most decision is try to put Argentina again back in the world.
With the American market, we are also increasing connectivity. In November, United started a new daily flight from Newark, New Jersey. On March 5, I will be meeting American Airlines authorities to try to get a new flight from Los Angeles. That means having direct flights from Dallas, Los Angeles, Chicago, and New York and Miami. It’s absolutely a priority market for us.
Skift: So in terms of these policy changes that you’re doing, including the airline connectivity and refunding the VAT, what other big policy things do you want to change?
Santos: We are developing important investments in the industry, in accommodations. Nowadays, our most popular destinations in Argentina are in the Patagonia region. But we have one of the best wine routes in the world. The United Nations World Tourism Organization has selected the province of Mendoza to be a wine tourism prototype.
But to top it off, we have one of the “New 7 Wonders of Nature,” the Iguazu Falls. Furthermore, we have a northwest region, which is amazing with salt plains, gorgeous ravines, the seven colors hills and the Puna de Atacama.
Skift: One of the things that you’ve done is that Buenos Aires is obviously the number one city in South America for meetings and events. How are you capitalizing on people coming for these conferences? And then being able to market tourism to them beyond that?
Santos: This year is very important for Argentina because this year Argentina has the Presidency of the G20. This year in November, the meeting of all the presidents of G20 will be in Argentina and our President, Mauricio Macri, will be the President all year of the G20. There will be more than 60 events related to G20 in Argentina this year. That includes the meeting of the Ministers of Tourism of the G20. The World Travel and Tourism Council event will also take place in Argentina in April. It will be a very big opportunity to announce new investments in our country.
Skift: So the investments that you said are in accommodation. What are you thinking in terms of hotels or different types of accommodation across the country? Do you think there’s still a lot of work to be done?
Santos: There are mainly two types. Traditional accommodation properties like chains hotels. And alternative accommodation properties, high end, but non-traditional. Mainly in nature destinations. Just for you to have an idea. In the Iberá Marshlands and in the jungle in the province of Misiones, there will be new accommodation properties more similar to African lodges than traditional hotel chains.
We understand tourism as an important matter for human development. In Mexico, they developed magical towns. We took this same model program in Argentina and we developed the authentic towns, as well. Small towns with unique features. I am convinced that tourism will be one of the main industries that will create employment in the next decade, in 10 years.
Skift: On the visa issue, do you think that there will be a Latin American visa kind of like there is in the EU? I know there’s a group called the Pacific Alliance that’s considered that.
Santos: I dream about that. Argentina already proposed to Brazil and Chile a reciprocal visa plan. I travel to Europe and I can enter it all from one country and visit others. I dream that in Latin America we can get the same. I will do all the efforts as a leader of the region to make this possible. I believe that if we share a database in all the countries and with the technology that is already developed in the region that we have enough tools to develop this kind of alliance or a shared visa. The big challenge is a balance between facilitation and security.