Failure Of Tourism Planning: Brexit

Scenario planning is not necessarily a complex process. It may need some imagination to attempt to come up with all possible scenarios, but even then some will not dreamt up. There are, though, ones which are relatively easy to consider. A decision to leave the European Union by the people of the United Kingdom is one of them. That possibility doesn't even require the complexity of scenario planning. It is something inherent to Business Studies 101 - the SWOT analysis - and it comes under the T, i.e. threats. It is so basic a tool that any business or government should have no difficulty in working up a SWOT.

For the Balearics, the threat of Brexit should have been abundantly clear. It was of course a decision totally beyond Balearic control. But that is the point. You seek to manage events beyond your control. You plan, you make decisions based on probability. How probable did Balearic businesses or government rate Brexit? At all?

The government made a decision some months ago to introduce the tourist tax a week after the result of the referendum would be known. Perhaps it did consider the probability. Indeed, perhaps it believes that it planned for the probability. At least there will be some tax revenue to compensate for losses through other revenue generation, it might believe.

The tourism advisory council is to meet this week. It comprises President Armengol, the tourism minister Biel Barceló, representatives of town halls, island councils, business associations, unions, plus "prestigious professionals" from the tourism sector. Its meeting is expressly to consider Brexit. It's about the closest the Balearics get to a sort of war council. The islands have got an emergency on their hands.

A sensible emergency measure, on account of the size of the British tourism market, would be to stall the tourist tax. With the pound going through the floor, spending power will be greatly reduced, and yet of course so much has been bet on tourist spend this year. The government's four per cent growth figure for 2016 is now looking unattainable. Its revenues will not be what they were - the tax from property sales will be just one lost stream. The tourist tax revenue, modest by comparison with other sources, will not compensate, but take it out of the equation and spending might, just might, not plummet as much as it would otherwise do.

The government won't do this. Or you would think not. If it did, it would be proof that it hadn't factored Brexit into the equations, when it should have done. Furthermore, while there is chaos all round because of Brexit, there is the chaos which surrounds the regional government. At least this has not yet been heightened, given that the election did not give Podemos what it (and Més) had sought - a third seat in Congress. Nevertheless, while Armengol might want to move in one direction, others would prevent her.

No one seems to have seen this coming. Take the hotels and tour operators. They announce that there will be price rises for 2017 of up to 15% at the very time the referendum is taking place. British tour operators are already asking for discounts.

What a complete and utter mess. Yes, it was out of anyone's control, but a modicum of planning and awareness of the T-threat might have helped to limit the damage.