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Spending by
visitors declines

Fewer Japanese came last year
and those who did spent
10.7 percent less on average
than in 1998

By Tim Ruel
Star-Bulletin

Hawaii's tourists spent $299 million less while visiting here last year compared with 1998, largely because fewer visitors from Japan came, and those who did spent less.

Total visitor expenditures slipped 2.9 percent to $9.9 billion in 1999 from $10.2 billion in 1998, according to figures released yesterday by the state Department of Business, Economic Development & Tourism. Visitor spending in 1998 had dropped 5.6 percent from $10.8 billion in 1997, the state said.

Yet Hawaii's economy has not suffered from last year's slip in the state's largest revenue driver, said Pearl Imada Iboshi, administrator for the state Research and Economic Analysis Division. In fact, the Cayetano administration reported yesterday that state tax revenues rose $120 million, or 4.2 percent, for the fiscal year ended June 30. Still, Iboshi admitted being initially shocked by the drop in visitor spending. "When we first got the numbers, we thought, 'How can this be?'"

The drop came mainly from Japanese tourists, said David Carey, who presented the figures to the Hawaii Tourism Authority board yesterday at the Hawaii Convention Center. Carey is vice chairman of the authority and chief executive of Outrigger Enterprises Inc.

Data were gathered from departure surveys on international flights, and arrival diaries mailed to a random sample of domestic passengers.

Total arrivals from Japan were down 7.5 percent to 1.85 million visitors in 1999 vs. 2 million in 1998. Making things worse, the average Japanese visitor spent $226 a day in the state in 1999, down 10.7 percent from $253 in 1998.

Visitors from the mainland increased at the same time, to 4.5 million in 1999 vs. 4.2 million in 1998. While that increase more than made up for the loss in the number of Japanese visitors, it did not make up for the loss in spending since mainland tourists typically spend far less on average than the Japanese, Iboshi noted.

Furthermore, per-person spending by mainland tourists also dropped last year. State figures show that visitors from the Eastern United States on average spent $160 a day in Hawaii, down 3.8 percent from $166 in 1998, and visitors from the West spent $128 a day, a 2.8 percent drop from $132 a day a year earlier.

Tourists from the mainland and Japan are spending less because they have become more familiar with Hawaii as a vacation spot and know better where to go and what to buy, said Chuck Gee, retired dean of the School of Travel Industry Management at the University of Hawaii-Manoa.

The drop-off did not show up in the state's retail spending -- which recorded the strongest growth in the nation from late November through May -- because that increase was driven by optimistic local consumers, Gee said.

Gee predicts visitor spending will continue dropping until Asia's economy picks up again.

The state's figures, however, target spending to grow 4.6 percent to $10.39 billion for 2000.

Other highlights from the state's report yesterday:

The average visitor spent $1,450 per trip in 1999, down 4.5 percent from $1,518 in 1998.

The average Japanese tourist spent $1,941 per trip last year, down 8 percent from $2,110 in 1998.

The average visitor from the Eastern United States spent $1,650 per trip, down 5.7 percent from $1,749 a year earlier, while the average tourist from the Western United States spent $1,260, a 3.7 percent drop from $1,309 in 1998.