ANALYSIS FOR FIRST QUARTER 1999:

Overseas arrivals (excluding Mexico and Canada) to the United States for the first quarter of 1999 were right on target for the forecasted 1 percent growth rate according to the Department of Commerce, Tourism Industries office. The year started with January down 3 percent compared to January in 1998. February arrivals were flat, as the previous year, but March jumped by nearly 7 percent (up 6.6 percent) compared to the same period in 1998.

Western Europe continued to buoy the overseas growth up by nearly 5 percent. Asia is still declining by 4 percent. South America is down slightly (down 2 percent) showing signs of Brazil's weakening currency in the first quarter of 1999. Oceania was flat compared to last year's first quarter, conversely Central America and the Middle East both had double digit growth, (up 21 percent and 11 percent respectively). Arrivals from both the Caribbean and Africa were up 4 percent and 1 percent respectively. Eastern European arrivals dropped by 5 percent in the first quarter of 1999 compared to the first quarter of 1998.

Canadian arrivals in the first quarter of 1999 still continued to drop, down more than 5 percent from the first quarter of 1998. Most of the decrease is attributable to land travel which was down 9 percent, while air arrivals dropped a mere 1 percent compared to the first quarter of 1998.

Mexican air arrivals and arrivals into the U.S. interior (travelers staying overnight and traveling 25 kilometers beyond the boarder zone) in the first quarter of 1999 grew by 14 percent despite the economic downturn and the devalued Peso.

Top Markets

Japan dropped nearly 9 percent, the same gains that the United Kingdom gained in first quarter of 1999 compared to the same period in 1998. Despite the nearly 18 point difference between Japanese and British arrivals for the first quarter, Japanese arrivals still rank number one for overseas visitors.

German arrivals continued to show signs of improvements with solid arrivals growth (up nearly 6 percent) in the first quarter of 1999. Dutch arrivals dropped by 16 percent while Spanish and Swedish arrivals increased by 9 percent and 4 percent respectively, compared to the first quarter of 1998. French arrivals remained steady with an increase of 3 percent in the first quarter of 1999 compared to the same period in 1998. France continued to edge out Brazil for the third largest overseas market in the first quarter of 1999. Brazil's currency devaluation in January 1999 was reflected in double digit decline in arrivals to the United States (down 16 percent), compared to the same period in 1998. All three first quarter months for Brazilian arrivals were down by double digits (January down 11 percent, February down 23 percent, and March down 19 percent). Other top South American markets have weathered Brazil's economic storm through the first quarter of 1999.

Argentine arrivals sharply declined in January (down 9 percent), but then leveled off in February and March arrivals grew by 8 percent to end the first quarter down only 1 percent compared to the first quarter of 1998. Venezuelan arrivals continued to grow despite Brazil's currency devaluation. Arrivals to the United States grew in double digit fashion (up 17 percent) spurred on by a 40 percent increase in arrivals in March alone.

South Korean arrivals began to rebound with nearly a 40 percent increase from the dismal declines in the first quarter of 1998. The increase of 1998 did not however recoup the loss in arrivals experienced in 1998's first quarter (down 54 percent from 1997 first quarter). Taiwanese arrivals were also positive in the first quarter of 1998, up nearly 6 percent, but arrivals from Peoples Republic of China and Hong Kong continued to decline in the first quarter of 1999 compared to the first quarter of 1998.

Top Overseas Markets First Quarter 1999 results:

• Japan down 9%; 1,148,456 visitors
• United Kingdom up 9%; 860,037 visitors
• Germany up 6%; 405,241 visitors
• France up 3%; 202,817 visitors
• Brazil down 16%; 182,304 visitors
• Argentina down 1%; 157,076 visitors
• Italy up 6%; 123,467 visitors
• Venezuela up 17%; 111,598 visitors
• Australia down 1%; 101,317 visitors
• South Korea up 40%; 100,285 visitors
• Netherlands down 16.4%; 96,131 visitors
• Republic of China (Taiwan) up 6%; 95,712 visitors
• Colombia up 18%; 85,231 visitors
• People's Republic & Hong Kong down 8%; 80,153 visitors
• Sweden up 4%; 78,538 visitors
• Switzerland down 4%; 72,002 visitors
• Spain up 9%; 68,449 visitors

Source: U.S. Department of Commerce 1999 first quarter Summary of International Travel to the United States (January, February and March) reports. The 1999 reports can be purchased via TI's web site at http://tinet.ita.doc.gov/research/programs/i94/index.html