STRONG CANADA DOLLAR HURTS NIAGARA FALLS TOURISM
OTTAWA, NOVEMBER 28, 2007 (MALAYA) Niagara Falls, one of Canada’s most prized tourism attractions, is luring fewer American visitors this year because of an unfavorable exchange rate, a Canadian tourism official said.
The number of US day trippers crossing the border into Canada to see the spectacular waterfalls has dropped 16 percent this year, Christopher Jones, vice-president of public affairs for the Tourism Industry Association of Canada, told a parliamentary finance committee.
Niagara Falls is one of many cases of lost tourism revenue seen across Canada due to the rising value of its currency against the US dollar, Jones said.
"We’re hearing similar stories from border towns such as Windsor (Ontario) and Victoria (British Columbia)," he said.
Lawmakers have requested testimony from dozens of businesses, industry groups and economists on the impact of the strong Canadian dollar in order to make recommendations for the government on its next budget.
Canada’s dollar has risen rapidly against the greenback in recent months. It reached parity with the greenback in September and peaked at a modern-day high of $1.1039 on Nov. 7 but has depreciated since then to $1.015, or 98.54 Canadian cents, on Thursday.
As a result, fewer tourist dollars stay in Canada as more Canadians head south to take advantage of their greater purchasing power while U.S. tourists see little attraction in coming to Canada.
Americans make up 86 percent of non-resident tourism in Canada.
The currency appreciation of the past nine months should result in a 16 percent increase in overnight travel by Canadians to the United States, estimates Paul Darby, deputy chief economist at the Conference Board of Canada. —Reuters
Gov’t expects to maintain record growth of over 7% for the year By MAX ESTAYO
(MALAYA) Bangko Sentral ng Pilipinas Gov. Amando Tetangco Jr said yesterday that growth in the third quarter may have expanded by seven percent.
Tetangco agreed with the forecast of NEDA director general Augusto Santos that growth will range from 6.5 to 7.1 percent for the third quarter.
The two economic managers said that the economy will sustain its record growth of over 7 percent for the year.
During the first quarter growth was at 7.5 percent, highest in three decades, followed by 7.1 percent in the second quarter.
Tetangco sees growth from higher agricultural output.
The third quarter is traditionally the harvest season and BSP officials said farmers were still able to plant despite the dry spell during the middle part of the year. The agriculture sector accounts for 20 percent of gross domestic product.
"Despite the delay in the planting season, there were some parts that were planted so we’re now harvesting rice," BSP deputy governor Diwa Guinigundo said.
Guinigundo said strong consumption would also support the expansion during the quarter.
"Consumption is expected to be sustained because of remittances. Investments are also strong," Guinigundo said.
Guinigundo said the government’s increased expenditures on infrastructure might have also boosted growth during the quarter.
Meanwhile, Tetangco said that while the BSP has safely kept the lid on liquidity growth to keep prices stable, the low levels will not be supportive of economic growth.
"Our recent runs show that we are still at an M3 growth rate that is consistent with a favorable and benign inflation outlook. But very low levels of liquidity growth may not be consistent with sustained GDP growth at the same or higher pace," Tetangco said.
The growth in domestic liquidity, the broadest measure of money supply, decelerated for the fifth straight month to 11.4 percent in September from 14.9 percent in August as siphoning measures remained in place.
Tetangco said credit demand is not picking up as fast as foreign-exchange inflows, putting the BSP in the defense against excessive liquidity growth.
"What we would really need to see at this time is an increase in demand for credit for investment and other productive endeavors as the means of absorbing the liquidity that is coming from the external side," Tetangco said.
"We are hoping that the private sector would take advantage of this and the current low levels of interest rates to expand capacity," he said. The economy posted its highest growth in two decades at 7.5 percent in the second quarter from 7.1 percent in the first quarter and 5.5 percent last year, supported by robust growth in the services sector and consumption.
It brought growth at an average of 7.3 percent in the first half. A sustained favorable outturn in the third quarter would enable the government to hit the high end of its 6.1-7.1 percent growth target for this year.
Chief News Editor: Sol Jose Vanzi
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