Fáilte Ireland chairman Michael Cawley has warned hospitality businesses in Ireland against rising prices, despite the perception from visitors that the country is becoming better value for money.
Speaking at the Fáilte Ireland's annual 'Tourism Industry Review' this week, Cawley said that favourable exchange rates between the euro and the sterling and US dollar were "masking" rising prices in the sector.
The report found that only eight per cent of visitors to Ireland rated Value for Money in Ireland as 'poor' compared to other continental European cities, while 58 per cent said it was 'good'. This is a welcome change to perceptions in 2011, when 37 per cent gave Ireland a 'poor' rating and just 38 per cent said it was 'good'.
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Despite this improvement, Cawley said this "masks the reality", as the main markets that said Ireland is improving its value are the US and UK, whereas visitors from the Eurozone said it is becoming more expensive.
"Our underlying cost creep is at an unacceptable level," said Cawley. "We can't ultimately depend on strong currencies to bail us out, and that seems to be what's happening here. And when currencies realign - as they do - we'll be in trouble here."
After a record year for tourism in Ireland with 7.9 million overseas visitors, the agency is projecting a five per cent growth in 2016, thanks in part to increased connectivity from North America and Europe. It plans to spend €55 million in the coming year on developing its current tourism brands including the Wild Atlantic Way and Ireland's Ancient East.
Cawley mentioned that while the Wild Atlantic Way has received overwhelmingly positive feedback, it is still relatively unknown outside of Ireland, which he said presents an opportunity to further develop the brand overseas, which he called a "20-year project".