Thank you, Mr. Chair, and thank you once again for inviting us to appear before you today.
The Canadian Tourism Commission is a crown corporation of the Government of Canada. We are in the business of marketing Canada as a tourism destination. The CTC does this in collaboration with industry and all levels of government.
Our ultimate goal is to create wealth for the Canadian economy by attracting foreign exchange from tourism sources--in other words, to grow tourism export revenues.
To this end, we operate in nine international countries where we get the highest return on Canada's investment, and we are succeeding. Together with the industry and provincial partners, whose partnership investments with CTC exceed CTC's investments, marketing messages transmitted abroad to come and explore Canada helped generate $17 billion in foreign exchange for Canada last year.
Tourism marketing provides an immediate return on investment. Our conversion studies show that every $1 we spend on marketing can earn Canada as much as $11 in international tourism spending. And Canadians benefit from their investment. Out of every tourist dollar spent by Canadians or international visitors in Canada, 30ยข goes directly to government. The federal government's share alone amounted to $9.9 billion last year.
As you may know, CTC's annual report for 2006 was tabled in Parliament earlier this month by the Honourable Maxime Bernier. Together with our partners we delivered some impressive marketing and sales results last year. With Canada's tourism brand as the base, and industry partnerships, cutting-edge research, and the world's most advanced e-marketing techniques, we are attempting to improve Canada's standings in the global tourism rankings. These advances are timely and sorely needed.
Tourism revenues may have amounted to $67.1 billion in 2006, up 7.1% over 2005, but not all is as positive as it seems. A closer look shows that three-quarters of this number comes from domestic tourism--Canadians themselves taking advantage of their robust economy. This proportion has grown from two-thirds to three-quarters in just five years.
International travellers, the tourism industry's most lucrative customers and the main source of foreign exchange for Canada, came in fewer numbers last year. This decline is almost entirely due to declines from the U.S. market, which accounts for 77% of Canada's overnight visitation and 55% of revenues.
While many other international markets are experiencing strong growth--especially China, Mexico, and South Korea--and are thus key priorities for CTC, we cannot take our eye off the ball in the U.S. So among the many issues that have plagued Canada from the U.S. market these past few years, it is heightened global competition that preoccupies us the most.
The 2006 numbers aren't in, but between 2002 and 2005, Canada dropped from seventh to twelfth in the rankings of world tourism arrivals. Hong Kong, Malaysia, and China, meanwhile, have each taken up residence in the rankings in the top ten in the past decade or so.
The forecast doesn't look much better for the world's traditional destinations. For the next 15 years it is expected that Asia, Africa, and the Middle East will continue to post strong gains at the expense of Europe and the Americas. By 2020, Europe and the Americas together will barely crest a billion international arrivals. Asia, Africa, and the Middle East together will easily hit 1.6 billion.
I can assure this committee that the CTC will take the budget it has and focus on those markets where Canada can get the highest return on investment, including, of course, the important U.S. market.
Thank you.