Canada
Tourism is an important sector of Canada’s economy and is a large source of jobs and growth. In 2019, the sector directly represented 2.1% of GVA and 3.6% of all jobs across Canada. The COVID-19 pandemic has had a significant impact on the sector. In 2021, tourism provided 498 900 jobs, down 197 500 jobs from 2019, and tourism GVA was CAD 24.2 billion, 1.0% of the Canadian economy.
After a record high of 22.1 million international tourists in 2019, visitation fell to 3.0 million in 2020. International tourist arrivals remained low in 2021, at 3.1 million tourists. Domestic tourism fell from 93.7 million overnight stays to 68.2 million in 2020. Domestic tourism trips recovered slightly in 2021 but remained 26% below pre-pandemic levels.
Total tourism expenditure fell from CAD 105.1 billion in 2019 to CAD 52.8 billion in 2020. This was held up by the relatively stronger performance of domestic tourism, which increased from 73.2% of total expenditure in 2019 to 91.8% in 2021.
Domestic tourism is expected to return faster than international tourism, with a return to pre-pandemic levels forecast in 2024. Recovery of international arrivals is expected in 2026. During the period January to July 2022, international tourists remained 48.6% lower than in the same time period in 2019.
In Canada the Federal Government, ten provincial governments, three territorial governments and the municipalities all play a role in supporting the tourism sector. The Federal Government holds exclusive responsibility in key policy areas, including border, air and visa policies.
The Minister of Tourism and Associate Minister of Finance (supported by the Department of Innovation, Science and Economic Development) is responsible for tourism at the federal level.
Other key federal players include Destination Canada, the national destination marketing organisation. Destination Canada works with partners in both the public and private sectors to promote Canada abroad as a premier tourism destination. As a Crown corporation, it reports to Parliament through the Minister responsible for tourism.
The seven Regional Economic Development Agencies play a critical role in providing direct support to tourism businesses and communities throughout the country. Provincial and territorial governments are responsible for domestic (and some international) tourism promotion, destination and product development, accommodation regulation, and hospitality and tourism education.
Canada has various mechanisms to ensure horizontal and vertical co-ordination and collaboration. Chief among these is the Canadian Council of Tourism Ministers, which annually brings together federal, provincial and territorial tourism ministers to discuss trends and issues facing Canada’s tourism sector and to identify opportunities for collaboration.
Canada continued to make investments specifically tailored to the tourism sector in the 2021 Budget, totalling CAD 1 billion over three years. Measures included a CAD 500 million Tourism Relief Fund (Box 1.9), CAD 200 million to support internationally renowned festivals, and CAD 200 million to support smaller events in communities throughout the country. Budget 2021 also sought to drive demand for Canadian tourism by investing CAD 100 million in marketing initiatives through Destination Canada. In total, from the onset of the pandemic to April 2022, Canada’s tourism and hospitality sector received an estimated CAD 23 billion in support through federal emergency programmes.
Source: OECD, adapted from Department of Innovation, Science and Economic Development, 2022.
In 2019, the Federal Tourism Growth Strategy was announced, an overarching national strategy to support long-term sustainable growth in the sector. The strategy was built on three pillars: building tourism in communities, attracting investment, and promoting public-private collaboration. As part of the 2019 Strategy, the Government launched a CAD 58.5 million Canadian Experiences Fund (CEF) to enable communities to create, improve or enhance tourism products, facilities and experiences. The CEF investments were disbursed over two years (2019-20 and 2020-21) for tourism development projects in five priority areas: winter and shoulder-seasons; indigenous; inclusiveness (LGBTQ2); rural and remote; and culinary.
With the onset of the pandemic, the Federal Government recognised the critical need for an economy-wide suite of core measures to support businesses, families, and individuals. Canada made resources available through the COVID-19 emergency economic response to help businesses survive the pandemic. These liquidity measures ensured that businesses could access credit, keep employees on the payroll, and pay their rent.
In response to the duration of the crisis and the specific needs of tourism businesses, Canada brought in the Highly Affected Sectors Credit Availability Programme to provide government-backed loans of up to CAD 1 million per business to the hardest-hit sectors, including tourism. Furthermore, 25% of the CAD 2 billion Regional Relief and Recovery Fund was earmarked for tourism businesses.
As an example of the sector’s increasing significance, tourism is steadily becoming an important economic contributor and job creator for Indigenous communities across the country. Cultural experiences that Indigenous Peoples share with visitors are important attractions for Canadian tourism, especially within international markets.
With the devastating impact of COVID-19 on the tourism sector, Indigenous communities that rely heavily on tourism have been disproportionately affected. The Tourism Relief Fund will continue to invest in Indigenous tourism by setting a national target of CAD 50 million for Indigenous tourism projects. In addition, through Budget 2022, Canada provided CAD 20 million for new Indigenous tourism funding to help the Indigenous tourism sector recover from the pandemic and position itself for long-term, sustainable growth. The Federal Government also proposes to provide CAD 4.8 million to the Indigenous Tourism Association of Canada to support its operations, which continue to help the Indigenous tourism sector rebuild and recover from the pandemic.
As the sector looks forward to a post-pandemic recovery, Canada’s Budget 2022 announced that the Minister of Tourism and Associate Minister of Finance would work with the tourism sector, provincial and territorial counterparts, and Indigenous tourism operators to develop a new, post-pandemic Federal Tourism Growth Strategy to plot a course for growth, investment, and stability. To help shape the new Strategy, the Minister has engaged in an extensive consultation process with domestic and international tourism stakeholders, totalling over 400 engagements since May 2022. The engagement process has included regional and thematic roundtables on tourism investment, workforce, rural, sport, Indigenous, cultural, and culinary tourism. Regional roundtables provided a platform for tourism businesses and industry leaders across the country to highlight their needs, challenges, and interests.
The Minister of Tourism is also committed to developing a national strategy to promote trails tourism in Canada. This strategy will provide direction for the enhancement and maintenance of Canada’s extensive trails network, such as the Trans Canada Trail.