The floodgates of tourism are being raised and that’s great news for America’s retailers.In January, President Obama signed a little-noticed executive order that simplifies and shortens the visa process for Brazilian and Chinese tourists, with the explicit goal of doubling the number of visas processed for Brazil and China by 2013.
According to Citi’s Deborah Weinswig, the result could be substantial revenue gains down through the entire retail food chain in the U.S.
That’s because, on average, Chinese tourists spend over $6,000 per U.S. visit, and Brazilians spend almost $5,000, according to the analysts.
Saks and Macy’s stand to be the greatest beneficiaries of the changes, they write, with Saks seeing up to 120 bps potential upside in same-store sales, and Macy’s 50 bps. Abercrombie & Fitch and Coach would also likely see gains, as would real estate investment trusts, the corporations that control malls. Most hotel operators you can think of — Hyatt, Marriott, Starwood, etc. — would also benefit tremendously.
The analysts finish by pointing out how costly current visas measures, which were put in place after 9/11 — are to the economy:
If the U.S. were to match Western Europe’s market share of tourism from emerging markets by 2015 and maintain it through 2020, it would attract 9.9 million more visitors from China, India, and Brazil, which translates to $59 billion in additional travel spending and 418,000 more U.S. jobs by 2020, according to the U.S. Travel Association.
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