Mexico Turns to Tourism in Midst of Economic Crisis
Olga R. Rodriguez - Associated Press
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Puerto Vallarta's Banderas Bay

With battered peso, pristine beaches, Mexico turns to tourism as crisis deepens

Mexico City - It's got sun, white-sand beaches and better yet — a battered peso.

Mexico is counting on its weakened currency against the dollar and its proximity to the U.S. to attract recession-shocked Americans and fuel its tourism industry — a major source of foreign income.

Tourism officials say Mexico saw 3 percent more visitors who spent an estimated 4 percent more in 2008, with tourists flocking to its beaches and cobble-stoned streets even during the global economic crisis. And, unlike most tourist destinations around the world, there is no sign that this year will be any different.

Cancun, Mexico's top beach destination, had an occupancy rate of more than 90 percent during the holiday season and officials expect at least 85 percent of the Caribbean resort's 31,000 rooms to be occupied during the winter months.

Cancun remains the preferred beach spot in Mexico for spring-breakers, with some 30,000 revelers expected to visit this year. The same amount came to Cancun last year, according to Quintana Roo state's Tourism Department.

Erin Erwin, a senior at the University of North Carolina at Chapel Hill, said she and five of her friends booked their spring-break trip to Cancun because it offered a good deal.

"The prices get so expensive, so I wanted to book my trip early, and my friends chose Cancun because it was really cheap out of all the destinations," Erwin, 21, said.

The group is paying about $1,000 each for five nights at an all-inclusive hotel.

"It's basically the environment for college kids. There is drinking, and having fun and there's sun and is warm and you lay out and not worry about anything," she said.

Jackie Lewis, managing director of studentcity.com, a Web site devoted to spring-break travel, said reservations for spring break in Cancun and Acapulco remain strong, mostly because they can find good deals.

"We've seen students who are asking for packages that are cheaper, so they may not be staying at the five-star hotels and looking for seven-nights all inclusive. They may be doing four or five nights at a four-star or three-star," Lewis said.

Mexico attributes the positive tourism trend to a tumbling peso, which lost 30 percent of its value in 2008. In August, it was trading at 10 to the dollar. Now it is 14 to the dollar.

Another advantage is the drop in jet fuel prices, which have made flying cheaper and Mexico more attractive to North Americans looking to save some money.

Brian Hoyt, a spokesman for Orbitz Worldwide Inc., which owns Cheaptickets.com and Orbitz.com, said the company's hotel bookings in Mexico were up 25 percent in the first 11 months of 2008, compared to the same period the prior year.

"There's never been a better time to travel (to Mexico) from a value standpoint than right now," Hoyt said.

The Tourism Department says more than 18 million tourists, about 80 percent from the U.S., visited Mexico between January and October 2008 and spent about $14 billion.

Mexico is counting on tourism to drive it through the global economic crisis, with more aggressive ad campaigns on the Internet, the construction of a $7.5 billion resort in the Pacific Coast state of Sinaloa, and increased promotion in places like China, Russia and India, where the number of people with disposable income is rapidly growing.

That will likely pay off. With endless beaches, quaint colonial mountain towns, ruins, and booming cities filled with restaurants and museums, the industry employs some 2.25 million people.

The Caribbean, meanwhile, has seen a sharp drop in tourism prompting resorts to lay off workers. Cheaper rooms can still be found in the region's islands but experts say they are often offset by expensive airfare.

Jesus Almaguer, president of Cancun's Hotels Association, said Mexico is already drawing more North American tourists who would normally go to other Caribbean spots.

"We compete a lot for Canadian tourists with Jamaica and the Dominican Republic and I would dare to say that we're winning the battle this year," Almaguer said.

If You Go...

MEXICO: The country's official tourism Web site is at http://www.visitmexico.com. There you can find many city guides, including activities, maps, accommodations, transportation and weather information.

CURRENCY: Exchange rates are usually better at airports, but be sure to check the rate first. Some exchange houses, especially in resort cities, have unfavorable rates. It might be better to use your ATM card and withdraw pesos.

HOTELS: Several travel Web sites, including http://orbitz.com, http://tripadvisor.com and http://expedia.com, offer good deals on hotels in Mexico.

BEACHES: Among Mexico's top beach destinations are Cancun and the Riviera Maya. Cancun is about a five-hour direct flight from Seattle and four hours away by plane from New York City. The Riviera Maya is another hour south by car. Both offer pristine beaches with turquoise waters and are close to Mayan ruins. On Mexico's Pacific Coast you will find the resort city of Acapulco, the granddaddy of Mexican tourist resorts, and Puerto Vallarta, made famous by Elizabeth Taylor when she starred in "The Night of the Iguana."

COLONIAL CITIES: Most colonial cities are in central Mexico. Zacatecas, Guanajuato, San Miguel de Allende and farther south, Queretaro, are some of the most beautiful ones. A good option for those looking for a taste of Old Mexico but without hordes of tourists is the town of Real de Catorce in northern Mexico. The former mining town of 1,000 people is tucked on top of a 9,000-foot mountain and offers some great gourmet food from Italian, German and Swiss expats.