Mr. Niall Gibbons:

I thank the Chairman and the Senators. My name is Niall Gibbons and I am the Chief Executive of Tourism Ireland. I thank the committee for the opportunity to address it here today. As members will know, Tourism Ireland is the organisation responsible for marketing the island of Ireland overseas. We undertake marketing campaigns in 23 key source markets around the globe.

Tourism is a vital industry for the island of Ireland. It is a significant driver of economic growth and helps to support more than 281,000 jobs in communities right across the whole island. Overseas tourism has recorded six consecutive years of growth. Last year, 2016, surpassed all previous records, where we welcomed some 10.3 million overseas visitors, spending more than €5.3 billion. Northern Ireland has shared in that record growth. In fact, last year it welcomed more than 2.1 million overseas visitors, an increase of 9% over 2015, generating more than £543 million for the Northern Ireland economy. That is an increase of 12%.

This year, 2017, represents a mixed picture. The latest CSO figures show continued strong performances in the first four months of the year. North America is up 27%, Australia and developing markets are up 18% and mainland Europe is up 3% overall. Visitor numbers from Great Britain to the Republic of Ireland, however, declined by 8% in the first four months of 2017. Of greater concern is that British visitors to Europe increased as a whole in the same period. This means that the island of Ireland has lost market share. In fact, we have seen the annual rate of growth in British visitors go from a rise of 8% in 2016 to a drop of 12.4% in the month of April 2017 alone. This is quite a change.

The UK voted to exit the EU last June and Tourism Ireland took immediate steps to deal with that new situation. These included: market research undertaken by RedC in Britain to evaluate consumer sentiment on holidaying in Ireland; market assessment of economic trends by Oxford Economics; liaison with key tourism industry partners to assess implications; and liaison with key international partners and bodies such as the European Tourism Association, ETOA, and UKinbound, to gauge reaction and implications.

According to Oxford Economics, outbound holidays from the UK will decline by 1.5 million trips this year. It estimates that travel to the island of Ireland from the UK will decline by 4% in 2017. This means we are likely to welcome 141,000 fewer British visitors this year and experience a shortfall in tourism revenue of €43 million - and this is before any withdrawal from the EU or any attendant changes.

In addition, our Red C survey found that of those Britons who will holiday overseas, 50% are likely to spend less on holidays, 26% will change their accommodation type, 25% will reduce their length of stay, 18% say the Brexit vote will influence their holiday choice in the next year and 17% will think about postponing a trip outside the UK.

The other major issue identified relates to currency and competition. Ireland's competitiveness as a destination is also under pressure. The movement of sterling versus the euro and dollar since the referendum makes Great Britain a more competitive destination for visitors from mainland Europe and the United States.We have observed our competitors, VisitBritain, VisitScotland and VisitWales, intensifying their operations across all of Ireland's major tourism markets to capitalise on this.

According to Britain's Office for National Statistics, inbound tourism to the UK was up by 7% in the early months of 2017. Bookings for flights to the UK for spring and summer are up by 19%. Staycation searches within the UK are up by 25%. In terms of Ireland's competitiveness, searches on Booking.comfor hotel accommodation across a basket of European cities - Amsterdam, Barcelona, Copenhagen, London and Paris - show Dublin to be the second most expensive. Our value for money message is more important than ever in 2017.

The challenge of Brexit is very real. As outlined earlier, we are beginning to see the impact in the latest CSO results for visitors from Britain to Ireland. Working closely with our tourism industry partners, and with the Department of Transport, Tourism and Sport and the Department for the Economy in Northern Ireland, Tourism Ireland has identified and is implementing a number of strategic actions to mitigate the adverse impact. First, we are pursuing a strategy of market diversification. This strategy commenced in 2014 and focuses more effort on markets with longer staying and higher spending visitors. This saw mainland Europe become the largest contributor of overseas tourism revenue with €1.8 billion spent in 2016 and if current trends continue, North America will overtake Britain as the number two market in 2017. This spring, our national TV campaign in the United States of America reached an estimated 255 million potential visitors and our TV and digital campaigns in Germany and France reached 36 million potential visitors. Second, Britain will continue to be an important market for the island of Ireland. As mentioned earlier, competitiveness and value for money are more important than ever. Tourism Ireland is placing greater emphasis on the consumer segment that we call the culturally curious, who are generally less impacted by currency fluctuations than other groups of travellers. In Britain, we have a year-long marketing programme in place with greater focus on digital marketing, cinema and online advertising and publicity. Our expanded partnership programme with airlines, ferry operators and tour operators, is communicating strong price-led messages to drive home the value-for-money message. One example is the partnerships we have developed this year with Stena Line, Irish Ferries, Rosslare Europort and Waterford, Wexford and Kilkenny county councils to attract British visitors to Ireland's Ancient East.

Great Britain is a vital market for tourism to the island of Ireland. To the island as a whole it delivers 47% of all overseas visitors and around 30% of all overseas tourism revenue. The British market is even more important for Northern Ireland. Britain accounts for 65% of all visitors and 58% of all tourism revenue there. We simply must continue to defend our share of this highly competitive market. Against this backdrop, the tourism marketing budget has seen a 34% reduction over the past nine years.

We have also identified a number of key priorities from an overseas tourism perspective arising out of Brexit. Retention of the common travel area and free movement of overseas visitors across the Border is vitally important for the continued development of tourism to the island but especially for overseas tourism to Northern Ireland and to Border counties. On average, 75% of visitors from North America to Northern Ireland and 66% of visitors from Europe arrive via the Republic of Ireland. In addition, about 950 international tour operators now programme Northern Ireland, predominantly as part of an island of Ireland tour. Any impediment or perceived impediment to free movement between the two jurisdictions and delays at Border checkpoints could discourage tour operators from continuing to programme Northern Ireland and Border counties and holiday visitors from travelling between the two jurisdictions.

With regard to developing markets such as China, India and the Middle East, the British-Irish visa scheme, introduced in 2014, and the short stay visa waiver programme, introduced in 2011, have provided a significant boost to our promotional efforts in these markets. Tourism Ireland and VisitBritain signed a memorandum of understanding in April 2014, with the aim of working more closely together - particularly in long-haul markets outside of Europe and North America - to promote the island of Ireland and Great Britain as destinations to be visited as part of a single holiday. Over the past three years, the two organisations have worked together to highlight the British-Irish visa scheme in India and China. We welcome the recent announcement that the short stay visa waiver programme is to be extended for a further five years to 2021. The ongoing status of the British-Irish visa scheme requires clarification.

On a more positive note, we were very pleased that the World Economic Forum's global travel and tourism competitiveness index now ranks Ireland at number three in the world, out of 136 countries, for effectiveness of marketing and branding to attract tourists. This has been achieved despite diminishing resources through the development of world-class marketing programmes, including a significant digital footprint. Ireland.comnow attracts close to 20 million visits a year and is available in 11 languages. Tourism Ireland is the fourth most popular tourism board in the world on Facebook, the fourth on Twitter and the third largest on the globe on YouTube. The creation of award-winning digital campaigns has capitalised on our connections with "Game of Thrones" and "Star Wars" and has allowed us to reach new audiences and millions of active fans across the world. Campaigns with the major air and sea carriers serving the island of Ireland and with traditional and online tour operators leverage significant funding each year from the commercial sector. This is encouraged also with investment by Irish Ferries and Stena Line in the past few years.

Our annual overseas publicity programme and our relationships with 22,000 international media around the world, generate positive exposure for the island of Ireland worth an estimated €326.7 million each year and greatly influences perceptions of Ireland overseas. It is, however, not just about marketing. Favourable winds such as a 42% increase in air access since 2010, particularly on transatlantic routes, supportive currency exchange levels, the fashionability of the island of Ireland as a location for "Star Wars" and "Game of Thrones" and our capacity to shift to new, lower cost, digital and social media marketing have helped to deliver record performances to the island of Ireland over the past six years, despite diminishing budgets. Few, if any, of those factors will continue indefinitely. This spring, we will see the impact of exchange rates on the market from Britain. Research is also showing a significant and worrying diminution in what we call Ireland's share of voice, or visibility, in our top markets. Over the past year, we have seen major competitors intensify their marketing - not just in Britain where there is a major push for domestic holidays but also in North America, mainland Europe and Australia - in Ireland's most important tourism source markets.

It is not just about tourism boards. For example, last year Ryanair announced 15 new routes into Scotland from mainland Europe, including Germany, France, Italy, the Netherlands and Spain. Another critical component is the future of the EU-UK open skies agreement, which has the potential to have significant downside risks for Ireland if a successful solution is not found. In addition to this, a range of practical issues have been flagged by ferry operators in respect of the impact of Brexit.

The challenges are very real. We all know the world is a very turbulent place. I convey my condolences to the people of Manchester and London on the recent tragic events there. Issues of safety and stability, consumer confidence, exchange rates, energy and oil prices all play a role in the global tourism market.

Notwithstanding that, Tourism Ireland is working with industry partners to grow overseas tourism spend this year by 4.5%. We also aspire to deliver on the Irish Government and Northern Ireland Executive's long-term targets, the success of which will be dependent on the external factors I have already mentioned and the resources to implement world-class marketing campaigns in our overseas markets. I thank the committee for the opportunity to present today and I am happy to discuss these matters in further detail in the question and answer session.