Thank you very much, Mr. Chairman.
On behalf of the Tourism Industry Association of Canada, I want to thank the committee for giving tourism a voice in the pre-budget consultations. We hope your report will acknowledge the important role this industry can play in ensuring Canada's prosperity.
Tourism is a $62.7 billion sector that accounts for 2% of Canada's GDP. More than 200,000 mostly small and medium-sized enterprises operate in communities large and small in every province and territory in Canada. They keep 1.6 million Canadians working, contribute to community and economic development, and generate over $15 billion in tax revenues, including a federal share of $7.7 billion. Thus, tourism makes an important contribution to Canada's local and national economies, its standard of living as a nation, and the quality of life of all Canadians. It also makes a less tangible but equally important contribution to fostering mutual recognition and understanding among citizens of different countries, and in fact helping Canadians when they travel Canada to understand Canadians better. This is a tremendous asset in an era of rising global tensions. But that contribution is being challenged on a number of fronts: by growing competition from other countries that recognize the value of tourism and are investing strongly in marketing their countries; by the stronger Canadian dollar, which has made Canada a relatively more expensive destination for American visitors; by rising fuel prices, which have increased transportation costs and heightened security and are reducing traveller confidence and convenience; and by a domestic public policy environment that is threatening the Canadian tourism industry's growth potential.
According to the United Nations World Tourism Organization, Canada's global ranking has fallen from eighth in 2000 to twelfth in terms of receipts and from seventh in the world to eleventh in terms of international tourism arrivals. U.S. visitation to Canada fell by close to 30% from 2000 to 2005, from 44 million visits to 31.7 million visits. At the same time, Canada's travel deficit more than doubled, from $2.4 billion to $5.5 billion.
So what can be done? Three things. There are some key actions that the federal government can take to ensure that Canada continues to be a source of prosperity for Canadians.
First and foremost, it should increase its investment in destination marketing. Canada has some of the best tourism products, services, and experiences in the world, but it is not getting the message out to enough potential travellers about what we have here. The Canadian Tourist Commission needs an extra $100 million so that Canada can compete and win. That amount would be leveraged with matching private sector investments, and it would pay off, according to an independent study, in up to $4.2 billion in increased tourism revenue growth, yielding about 45,000 new jobs and $620 million a year in federal tax revenues. With a $100 million investment there would be a $600 million return to the federal government.
In the area of human resources, the federal government should invest more in tourism-related education programs through the Canadian Tourism Human Resource Council, and it should consult with the tourism industry on improvements to foreign worker programs. These actions are needed to help the industry deal with the shortfall of workers in the next decade.
Finally, in the critical area of air travel, Ottawa should immediately reduce airport rents and completely eliminate the air travellers security charge. Canada's air transportation system and the many businesses that rely on it have been bearing the burden of government-mandated cost add-ons that threaten the competitiveness of our airline industry in Canada.
Our written brief discusses each of these areas in more detail. I urge the members to take a look at those in preparation of their final report. Again, I thank you for your time.