It very well could be that the stars are aligning correctly and Brazil is on the road to recovery from its worst economic recession in a century. During the past two years, the number of bankruptcies across all sectors of the Brazilian economy, including the tour and travel industry, reached record levels, tourism spending abroad dropped and so did the numbers of visitors to U.S. destinations, especially for Florida. But here’s part of what we’ve experienced in the past two months:
–-At the NAJ Salon discussion of more than a dozen industry professionals from the Orlando area held two months ago in Orlando, the consensus—in an opinion that had not yet hit the business news media—was that Brazil was seeing the early symptoms of a recovery. One participant noted that Orlando tourism industry was realizing more sales and bookings, and there were also the announcements that Tam and Azul—two of the three largest Brazilian—carriers were initiating direct service to Orlando. Such competition would likely result in lower airfares.
—Also in the last week, the respected travel trade publication, PANROTAS, reported it was picking up from airlines, hotel chains and tour operators “confirmation that there is a strong recovery movement in Brazil. Growth still on a very small base (called the ‘bottom of the pit’), but that raises industry optimism and shows results.”
Signs of Recovery: Quarter-on-quarter changes
of seasonally adjusted GDP and year-on-year variation in %
Source: Brazilian Institute of Statistics and Geography (IBGE) and FocusEconomics Consensus Forecast
—CVC, the largest tour operator/travel agency in Brazil (see next article); it also is also the most popular travel agency brand in the country) has announced that its sales for October established a monthly record for the month in the company’s 44 years of operation—more than 500 million Brazilian reais ($146.5 million). The last time the operator had broken the monthly was in January 2015, when it presented $ 491 million reais ($143.8 million) in sales in a single month.
—Inflation, which has steadily declined throughout 2016, fell in October to a 20-month low of 7.9 percent from September’s 8.5 percent. Even so, inflation still remains above the Brazilian Central Bank’s tolerance margin of plus/minus 2.0 percentage points around 4.5%. A steadier rate will stabilize prices for long-haul travel.