Irish hoteliers are more optimistic about the outlook for the tourism sector, with 51 per cent of respondents to an industry survey pointing to a positive outlook for trading conditions.
Despite this more positive outlook however, almost three quarters (71%) of hoteliers remain concerned about the future viability of their businesses, with uncertainty over whether or not the Government will retain the reduced VAT rate next year a key issue.
More than half of those responding to a survey undertaken by the Irish Hotels Federation (IHF) reported an increase in business compared with this time last year, with 90 per cent saying that the reduced tourism VAT rate has boosted their business.
Tim Fenn, chief executive of the IHF urged the Government to provide greater medium term certainty around the retention of the 9 per cent VAT rate so that international tour operators, who book accommodation services some 18 months in advance, can plan their trips to Ireland with greater certainty on pricing.
“While the rate reduction has greatly benefited tourism business, it needs to be more than just a short term measure if we are to achieve sustained growth in visitor numbers. This is particularly important for domestic and international tour operators which are a vital component of the hotels sector,” he said.
Key city destinations such as Dublin, Cork and Galway are benefiting from event and business-related tourism, while growth is also evident in the east and midlands regions, the south east and parts of the west coast, according to the survey.
However, occupancy levels continue to lag in the Shannon region and the south west.
Hoteliers cited excessive local authority rates and high electricity and gas prices as the most pressing issues stifling cost competitiveness within the sector, while the limited availability of credit was also an issue. Almost a third of respondents (31%) indicated that they have experienced difficulties accessing standard/normal credit facilities from their banks during the last year.