Travellers who returned from the Eurozone this summer may have found that inflation put as much pressure on their holiday spending as has done on finances at home. While inflation across the zone currently stands at 5.2 per cent, it is as high as 10.3 per cent for food and drink and 7.3 per cent in restaurants and hotels, according to European Central Bank analysis.
However, the latest Post Office Long Haul Holiday Report has found that price rises have not been a significant factor in long-haul destinations in the past year. Coupled with the strengthening pound, it means that winter sun-seekers will find their spending power has improved in nearly all the destinations surveyed.
Analysing the average cost of 10 common holiday purchases, from a bottle of beer to sun cream and a three-course dinner for two, the Post Office study has seen prices fall in 23 of the 26 destinations it surveyed last year, with local prices falling in a third of destinations and only two seeing rises of more than 10 per cent.
Holidaymakers in search of winter sun will find their money goes furthest in Asia, where seven of the 10 best-value destinations have been highlighted by the Post Office price barometer. Hoi An in Vietnam takes the top spot, where the total cost of the snapshot holiday shopping list is £52.66, a fall of 19.2 per cent since last autumn. Bali (Indonesia), Tokyo (Japan), Delhi (India) and Phuket (Thailand) ranked in positions four – seven, with Penang (Malaysia) and Colombo (Sri Lanka) coming in at nine and 10.
Africa also ranks highly. Mombasa in Kenya – where the shilling is currently worth a third less than last year against sterling – takes the second position and Cape Town in South Africa third, while Sharm El-Sheikh in Egypt is eighth.
Sterling has strengthened against the dollar by 10.8 per cent in the past year, making many destinations in the US more affordable for British visitors (though prices are almost one third higher in New York than in Orlando), as well as many Caribbean and Latin American destinations whose currencies are tied to the dollar.
One of the biggest consumer price drops has been in Santiago, Chile – down 43.9 per cent, followed by St Johns in Antigua which is down by almost a third. Montego Bay in Jamaica is the lowest priced of the seven Caribbean resorts surveyed, followed by Antigua, Saint Lucia and Tobago.
St James in Barbados came out as the most expensive long-haul destination surveyed, where holiday items cost a total of £169.17, more than three times more expensive than Hoi An, Vietnam.
Prices have risen in three destinations whose currencies have strengthened against sterling in the past year: Cancun in Mexico (up 7.1 per cent), Tamarindo on Costa Rica’s Pacific coast and Punta Cana in the Dominican Republic.
Tour operator Travelbag notes that the result of the Post Office survey is mirrored by customers’ bookings, with the highest volume of holidays this year to Asia. These are the 30 long-haul destinations ranked by the average cost of 10 common holiday items.
- Hoi An, Vietnam (£52.66)
- Mombasa, Kenya (£59.57)
- Cape Town, South Africa (£61.58)
- Bali, Indonesia (£72.39)
- Tokyo, Japan (£73.54)
- Delhi, India (£79.53)
- Phuket, Thailand (£88.36)
- Sharm el-Sheikh, Egypt (£89.56)
- Penang, Malaysia (£90.11)
- Colombo, Sri Lanka (£92.58)
- Orlando, US (£97.36)
- Montego Bay, Jamaica (£100.96)
- Rio de Janeiro, Brazil (£102.95)
- Santiago, Chile (£104.07)
- Lima, Peru (£111.70)
- St John, Antigua (£112.38)
- Rodney Bay, St Lucia (£116.82)
- Grand Baie, Mauritius (£118.57)
- Scarborough, Tobago (£125.72)
- Cancun, Mexico (£125.78)
- St Georges, Grenada (£125.95)
- Jumeirah, Dubai, UAE (£126.07)
- Auckland, New Zealand (£127.03)
- Vancouver, Canada (£130.80)
- Darwin, Australia (£132.25)
- Punta Cana, Dominican Republic (£133.23)
- Tamarindo, Costa Rica (£143.04)
- Ras al-Khaimah, UAE (£147.01)
- New York, US (£152.41)
- St James, Barbados (£169.17)
Laura Plunkett, Post Office head of travel money said: “By doing their homework to see where the pound is worth more and where resort costs are low, holidaymakers can save themselves a lot of money – even within the same country or region.”
However, while inflation is notably lower in many winter sun destinations than in Europe, the cost of long-haul flights remains generally much higher than pre-pandemic. Direct flights from Heathrow to Hanoi in Vietnam cost around £900 in November, and around £740 to Nairobi in Kenya.
Plunkett adds, “the positive exchange rate means winter sun tourists will see their pounds stretch further in the majority of destinations. However, while prices may be lower once they get to their destination, we advise holidaymakers to consider the whole picture and factor in the package price before booking.”