International visitor spending in U.S. spikes in first half of 2010

UNITED STATES Spending by international visitors to the United States rose about 20% in the first half of the this year, according to purchase data from credit card company Visa Inc.

Travelers from China and Brazil have accounted for the biggest year-over-year increases this year, up 74% and 73%, respectively, according to Visa data. Australians and South Koreans are also spending at an increased pace in the United States, jumping 44% and 39%, respectively. The biggest source market for the United States continues to be neighboring Canada, followed by the UK.

“The United States continues to be a major source market for international tourism and a popular destination for travelers around the globe,” says Bill Sheedy, Visa’s North America president. “The growth in inbound spending in early 2010, particularly from source markets such as China and Brazil, reinforces how Asia Pacific and South America are seemingly the first to emerge and rebound from the challenging environment that defined 2008 and 2009.”

In 2009, spending by international visitors declined 12%, from US$32.9 billion in 2008 to US$28.9 billion.

Meanwhile, Americans are spending at higher levels when traveling internationally, with spending by U.S. travelers abroad on Visa cards was up 9.3% in the first quarter of 2010 compared to the same period in 2009.

Impact of Gulf Coast oil spill

While BP’s oil spill in the Gulf Coast did not result in an immediate impact in the weeks following the spill—Visa transaction data from May reveals that tourism spending was up over 2009 levels—tourism sharply declined in June, down 42% compared to May and 9% year over year.

All four states along the Gulf Coast saw declines in tourism spending from May to June: Alabama was down 8%, Florida was off 35%, and Louisiana and Mississippi each saw tourism spending plummet by 65%.

Lodging and fuel are the two merchant segments that have been hardest hit by the crisis. Visa transaction volume in the lodging segment decreased 50%, while the oil and gas segment was down 42%. According to a recent survey of hotels in the region by the Knowland Group, 35% said that the oil spill has prompted guests to cancel their future reservations, and 42% said the spill has hurt their ability to book future events.