Domestic Tourism Rises with Middle Class

By Stephen Eisenhammer, Contributing Reporter

RIO DE JANEIRO, BRAZIL – With 2012 Carnival just days away, Rio is awash with tourists, arriving to experience what is widely deemed the greatest street party on earth. The city is full of adventuring travelers skimming their guidebooks and scratching their heads, but among the ubiquitous sound of English, French and German, is the increasing patter of Brazilian Portuguese.

The dramatic rise of domestic tourism, which has more than doubled since 2004 according to the Ministry of Tourism, is one of the clearest effects of Brazil’s booming economy.

“The increase has been very noticeable,” Omri Breda, co-owner and manager of the Villa Carioca Hostel in Botafogo, tells The Rio Times. “Just two years ago we had pretty much no Brazilian guests. Now they make up fifty, sometimes even sixty percent of the hostel,” he said.

Breda considers this rapid rise as a direct result of a growing middle class. “Brazilians have money now, there’s no doubt about that.”

The rise of domestic tourism is a well known marker for the growth of developing economies, as large numbers of the population move from living hand-to-mouth, to having extra income to spend as they choose. Since 2003 more than thirty million people have risen out of poverty in Brazil, which has had a direct effect on internal travel.

According to Brazil’s Ministry of Tourism, internal travel, which it measures by the number of Brazilian passengers landing at the country’s airports, hit nearly 69 million in 2010, an increase of eighteen percent on 2009; the largest jump since the statistics began in 2000.

According to SindRio (Union of Hotels, Bars and Restaurants in Rio), the current average occupancy in Zona Sul is expected to reach 98 percent. Currently, 68 percent of reservations are domestic tourists, while 32 percent are international.

The data is also being noticed beyond the tourist industry, with investors excited by the creation of a fresh crop of consumers. Peter van Rooyen of Cyrte Investments, a Netherlands-based investment house with a Latin American fund, sees the large numbers of Brazilians traveling for the first time as a clear indication of “More spending power at the middle income and lower income level.”

A survey from the Ministry of Tourism shows the percentage of Brazilians who want to travel through January 2012 grew in July, 37.6 percent over the same month last year. The percentage of respondents who plan to travel in the next six months rose from 25 percent in 2010 to 34.4 percent in July this year.

The desire of the majority of respondents, 66.2 percent, is touring national destinations, with the northeastern states, first, and the Southeast, ranking second.

As impressive as the domestic tourism sector looks, the foreign tourism is also strong despite a weakened dollar and global financial crisis. Flávio Dino, president of Embratur, explained “Brazil welcomed more than 5.4 million tourists into the country, resulting in US$6.4 billion in foreign exchange inflows, marking 2011 the best year yet.”

Rio, which hosts the country’s largest Carnival festival, expects to receive about 850,000 tourists, bringing more than R$1.1 billion into the state economy, and providing about 250,000 jobs, according to the Department of Economic Development, Energy, Industry and Services.