Canada
Tourism is an important part of the Canadian economy and is a source of jobs and growth in every region of the country. It accounts for 2.1% of Canada’s GDP and 3.1% of total exports, directly supports 739 700 jobs, or 3.9% of total employment, and generates over CAD 100 billion in tourism spending each year. Travel exports represented 26.6% of total service exports in 2018.
In 2018, Canada welcomed a record 21.2 million international tourists, up 1.2% over 2017. Canada’s largest tourism source market is the United States, which accounts for over two-thirds of overnight tourists, with over 14.7 million tourist arrivals in 2018. Among tourists from other source markets, visitors from China, France, Mexico and India set country records.
In 2018, 278 million total domestic trips were recorded, down from 328.5 million in 2017, of which 95.4 million were overnight trips. Domestic tourism accounted for 268.3 nights in 2018, down 2.5% over 2017.
In Canada, the Federal Government, ten provincial governments, three territorial governments and numerous municipalities all play a role in supporting the tourism sector. The Federal Ministry of Innovation, Science and Economic Development is responsible for tourism.
Destination Canada is the national destination marketing organisation. As a Crown corporation, it reports to Parliament through the Minister responsible for tourism. Destination Canada works with partners in both the public and private sectors, which include provincial, territorial, regional and municipal destination marketing organisations, and private companies, including airlines, to promote Canada abroad as a premier tourism destination. The federal government also holds exclusive responsibility for air policy and visa policy.
Provincial and territorial governments are responsible for domestic (and some international) tourism promotion, destination and product development, the regulation of accommodation, and hospitality and tourism education. At the municipal level, tourism activities generally involve attracting meetings and conventions, and promoting festivals and events.
Canada has various mechanisms to ensure horizontal and vertical co-ordination and collaboration on tourism. Chief among these is the Canadian Council of Tourism Ministers, which annually gathers federal, provincial and territorial tourism ministers to discuss trends and issues facing Canada’s tourism sector and to identify opportunities for collaboration.
In 2017, Destination Canada’s funding levels were stabilised and made permanent at CAD 95.5 million. In addition, in 2019 a one-year infusion of CAD 5 million for a domestic tourism marketing campaign was allocated to help Canadians discover new destinations such as less visited national parks, and promote off-peak seasonal travel and Indigenous experiences. The 2019 Federal Budget recognised tourism as an important source of jobs and growth, and also provided CAD 58.5 million over two years, starting in 2019 - 20, for the Canadian Experiences Fund (Box 3.10), which supports investments in tourism-related infrastructure – such as accommodation or local attractions – and the development of tourism products and experiences.
Source: OECD, adapted from Department of Innovation, Science and Economic Development, 2020
The Government of Canada’s main policy priorities with respect to tourism are threefold: creating jobs; diversifying and dispersing tourism offerings; and attracting investment to the sector.
In December 2018, Destination Canada released a report titled Unlocking the Potential of Canada’s Visitor Economy that identified the following key challenges facing Canada’s tourism sector:
Concentrated demand: Demand for Canada’s tourism offerings is concentrated in Canada’s major cities and a few key tourism destinations, and during the summer season.
Labour shortage and skills development: Access to skilled labour is a challenge, preventing the sector from maintaining sustainable business growth.
Access: The long-haul nature of much of the market and high cost of travel to Canada and between Canadian destinations.
Investment: The tourism sector has difficulty accessing investment and financing that is a barrier to new tourism business development.
Governance: Collaboration among governments is ad hoc and could be more strategic.
In May 2019, Canada’s Minister responsible for tourism launched Creating Middle Class Jobs: A Federal Tourism Growth Strategy. This new initiative is built around three pillars: building tourism in communities, attracting investment, and promoting public-private collaboration (Box 1.4).
Pillar 1: Building tourism in communities recognises that all communities have the potential to be a tourism destination. It seeks to enable communities in every region of the country to realise that potential by investing in infrastructure and tourism products. It is supported by the Canadian Experiences Fund, which was established to help improve Canada’s tourism product offering through investment in five priority categories:
Winter and shoulder-season tourism – with investments where Canada has an advantage, to provide more reasons to visit in off-peak periods.
Indigenous tourism – with investments to help Indigenous peoples present their unique histories, traditional stories, creative arts and contemporary values to the world. Over a third of visitors to Canada are interested in Indigenous experiences.
Rural and remote tourism – with investments in rural and remote areas to create jobs and economic opportunities in these communities, and to entice tourists to lesser-known parts of the country.
Farm-to-table and culinary tourism – with investments in projects like culinary trails, Indigenous culinary experiences, food festivals and farmers' markets, as well as onsite experience development such as breweries, wineries, farms, fisheries and maple syrup producers.
Inclusive Tourism – with investments to expand LGBTQ2 diversity training and market readiness programmes, and support Pride festivals.
Pillar 2: Attracting investment to the visitor economy includes the establishment of Tourism Investment Groups in every region of the country, with the objectives of better aligning investments in tourism products across the national government and other jurisdictions, and strengthening the ability of tourism destinations to attract more investment. These Groups are made-up of a network of core departments and agencies responsible for national parks, culture, and SME financial support, led by Destination Canada and the country’s regional economic development agencies. A broader network of local and regional partners from government, private, and not-for-profit sectors are expected to be involved to identify potential tourism projects, attract private investment, and catalyse impactful tourism projects, iconic attractions, and clusters.
Pillar 3: Renewed focus on public-private collaboration recognises the long-standing barriers to growing Canada's tourism sector, which are not easily overcome in the short term. Stronger partnerships with industry leaders are needed to tackle those challenges over the long term. To support this, in 2019, the Government committed to establish an Economic Strategy Table for Tourism. This new model for industry-government collaboration was created in 2017 and was focused on turning Canadian economic strengths into global advantages. Each Table promotes development in high-growth and high-potential sectors, and consists of industry leaders who set ambitious growth targets, identify sector-specific challenges and bottlenecks, and lay out an actionable roadmap to making the country an innovation leader in these sectors. The Economic Strategy Table for Tourism is expected to enable new ways of working in close collaboration with the private sector. This new initiative will ensure that tourism is on the front lines of economic policy-making, so that challenges are effectively addressed and strategic opportunities are seized to grow the visitor economy and create jobs. The Table will allow the Government to better identify medium-term tourism trends and any policy blind spots. Critical areas the Table is likely to address include the cost of travelling to and within Canada, labour shortages and the lack of investment. It may also look at competitiveness, sustainability, the sharing economy and digital platforms, and destination development.
The Federal Government has set ambitious but achievable targets to determine how well the Growth Strategy is performing, and three metrics will help measure its economic impact. Taking 2018 as a baseline and 2025 as the target year, the Federal Government will track:
Revenue (total spending by tourists on goods and services), with a target end value of CAD 128 billion (+25%).
Number of jobs created, with a target of 54 000 new jobs created (+7.3%).
Tourism GDP growth, with the aim of outpacing national economic growth.
The Strategy also sets targets for the seasonal dispersal of tourists, to increase by 1 million international tourist arrivals from November to April, and for geographic dispersion, aiming at growth in spending outside Canada's top three major tourism regions, Greater Toronto Area, Montréal, and Vancouver.