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Wednesday, Oct 18, 2017
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Weaker ‘loonie’ to slow Canadian trips to U.S.

Angie Meldrum sent a disc sliding down the concrete at Zephyrhills Shuffleboard Courts and smiled when it clacked into another player’s disc and sent it skidding.

A resident of Leduc, just outside Edmonton, Alberta, Meldrum has been staying at her winter residence in the Hillcrest RV Resort in Zephyrhills since October and plans to stay until April, as she has done every year for the past 13.

Although the weakening Canadian dollar — called the loonie when it’s a coin — has persuaded some of her friends up north to stay put this winter, Meldrum wasn’t about to alter her lifestyle.

When she started coming to Florida in 2002, the exchange rate was about the same as it is now: about 72 cents on the dollar, she said.

The weakening loonie “will affect our spending, sure,” Meldrum said. “We’re still going out to eat, but I won’t spend as much on clothes. We do save a lot on gas, though.”

The cost of gas in Canada is about 30 percent higher than in the U.S., according to frugal-rv-travel.com, a website that features cost comparisons on gas.

Thanks to the dip in the value of the Canadian dollar, economic forecasters have predicted that far fewer Canadians will be traveling to the U.S. this year, which could result in far less Canadian money getting spent here.

Local tourism boosters aren’t necessarily panicking.

“I think there’s some brand loyalty with Canada,” said Santiago Corrada, president and chief executive of Visit Tampa Bay. “They really have affection for the Tampa Bay region.”

Corrada said travel to the United States from Canada has dropped 8.8 percent through September year-to-year. But the Tampa Bay area’s close relationship with Canadian “snowbirds” seems to have insulated the area from the slump.

“We are not seeing that effect in Tampa. We’re pretty flat,” Corrada said.

The loonie began its tumble in 2013. Among the reasons, according to the Canadian Broadcasting Corp.:

♦ Falling oil prices. Canada is a huge exporter of oil.

♦ Diverging Canadian and American monetary policies. For the first time in nine years, the Federal Reserve raised its federal funds interest rate target this month, while the Bank of Canada is unlikely to follow suit and may even lower its key rate. Rising rates lure foreign investment.

♦ Strength in the U.S. dollar. The economic recovery here is driving up the U.S. dollar against a number of currencies.

This week, it would take about $1.39 Canadian to buy what would cost $1 in U.S. currency. Or, about 72 cents in U.S. currency to buy what would cost $1 in Canada. That figure was over 90 cents for all of last summer.

It’s an 11-year low for the loonie, and even if they’ve made the winter exodus, Canadians are feeling it.

Don Hebert, a semi-retired long-haul trucker from Guelph, Ontario, who winters at Ralph’s Travel Park in Zephyrhills, said he knows lots of people back home who aren’t coming to Florida this winter.

“A lot of people are on a very tight budget, and (over 30) cents on the dollar counts for a bunch; it hurts,” he said. Still, Hebert said, the exchange rate won’t affect him much.

“I’m at an age now where I don’t really need a lot,” he said. “We can buy what we need without (running out of money), and we pretty much stay around Zephyrhills.”

Besides, he said, the exchange rate has been worse.

“About 15 years ago, it was 50 cents on the dollar,” he said.

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David Downing, executive director of Visit St. Pete-Clearwater, also notes the normal fluctuation in currency rates.

“This is cyclical,” he said. “We do not expect this to be a long-term issue.”

Canada is the third-largest tourism market in Pinellas, behind Britain and central Europe. Downing said the devalued loonie may be affecting Canadian tourism, but he expects worldwide demand to displace any dropoff of Canadian travelers.

Prior Smith, longtime host of the radio program, “Canada Calling,” broadcast locally on WGUL (860 AM), agreed that not as many Canadians are likely to travel to Florida this year, but he predicted that the drop would not be dramatic.

The financial impact to the state may be even less pronounced, he said in a telephone interview from his Canadian home.

Smith, who lives in a rural area about 90 miles outside Toronto, said that about one-third of the residents on his road were in Florida last week.

“This whole Canadian tourism thing is unique; it’s a generational thing,” he said. “I go to Florida because my parents did, as did theirs. In many respects, we keep going back to the same places year after year after year. It’s home away from home.

“Years ago, the number of Canadians in Florida on a good winter, was about 1.2 million. Last winter season, there were in excess of 4 million. When you stop to think about it, it’s truly amazing. There are only about 33 million of us in Canada, so about one in every eight people tries to escape the winter.”

Smith also said the exchange rate is known to fluctuate. He recalled a time when the loonie was about 63 cents on the American dollar, but Canadians still went “in droves” to Florida for the winter.

“Winter being winter, you just don’t put up with it and you get out for a few days or a couple weeks,” he said. “When you get there, you watch your pennies like a hawk, don’t dine out or spend as much, and keep your eye very carefully on the dollar.”

If there don’t seem to be as many Canadians in Florida this year, Smith said Mother Nature may also be to blame.

“Winter hasn’t happened yet this year, which is highly unusual,” he said. “I can’t remember in all my years a non-existent winter. I’m overlooking a lake, which is usually frozen by now with snow on the ground.

“But, the lake’s not frozen and there’s green grass everywhere I look. This shouldn’t be happening, but it is, and the long-range forecast is the same.”

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Tampa International Airport isn’t seeing a negative impact, said an airport spokeswoman. For the fiscal year 2015 ending in September, nonstop traffic from Canada was up 13.2 percent to 309,361 passengers, the airport reported.

Though Canadian traffic was down 3.9 percent or about 1,500 passengers for the first two months of the new fiscal year, scheduled capacity for the rest of the winter-spring season is up 11.2 percent year-over-year, the airport said.

Meanwhile, Air Canada’s leisure subsidiary Rouge has introduced wide-body service to its southern U.S. markets for the winter. Beginning Dec. 1, Air Canada Rouge began operating a Boeing 767, with 280 seats, from Toronto to Tampa in lieu of the regularly scheduled Airbus 319, which has 136 seats. The service continues through April 30 of next year.

Bill Gerrior, of Halifax, Nova Scotia, has lived in Ralph’s Travel Park in Zephyrhills over the past seven winters. A retired musician, Gerrior said he knows folks back home who are staying put this year.

But he said such decisions are likely based more on personal finances than the exchange rate.

“The (exchange rate’s) fluctuation has always happened, but it hasn’t been this bad in six years or so,” Gerrior said. “We probably won’t go out to eat as much or buy very much merchandise, but food is cheaper (in Florida) and clothes are a little bit cheaper. You lose 30 cents on the dollar, so you don’t spend as much, but we’re still enjoying the sunshine.

“We’re blessed to be here, and we feel fortunate that we can come. Plus, we have so many American friends now; it’s the people that matter. It’s like having a whole (separate) life.”

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