Bali has retained its position as the cheapest resort in Post Office Travel Money’s annual report on the long haul holiday sector for the third year running. The Indonesian island was among 16 of 33 surveyed destinations to register year-on-year price falls, in most cases because of the strength of sterling.
Prices researched for the Post Office Travel Money report by the long haul tailor-made holiday specialist Travelbag reveal a 5.5 per cent price fall to £37.91 in the cost of 10 tourist staples in Kuta, Bali. The items surveyed were an evening meal for two with a bottle of wine, bottle of beer/lager, soft drink, glass of wine, cocktail, chocolate bar, mineral water, suncream and insect repellent.
Close on Bali’s heels, Cape Town (£41.58) remains second cheapest for the third consecutive year but a bigger price fall year-on-year of 10.9 per cent has helped the city narrow the gap.
While the price falls in Bali and Cape Town result from sterling exchange rate gains of well over 15 per cent, third-placed Tokyo (£51.81) has moved up from eighth position in the 2014 table because of a combination of the strong pound and local price cuts. When this year’s 21.5 per cent price reductions in the Japanese capital are added to the significant falls reported 12 months ago, costs for UK visitors have now dropped 50 per cent since 2013, making a destination previously thought expensive an increasingly affordable option.
This year’s biggest falls have been in Penang, where prices have plummeted 41.1 per cent year-on-year to £68.29. This takes the Malaysian island up to 10th place in the barometer table from 28th last year, when Post Office Travel Money reported big price rises. Increasing competition to attract back tourists after the difficult year experienced in 2014 may account for the big falls in local prices charged in Penang’s restaurants, bars and shops. These have compounded the benefit of sterling’s 28 per cent surge in value against the Malaysian ringgit.
In addition to Bali, Tokyo and Penang, three other Far Eastern destinations look set to offer good value. Although prices are up 6.2 per cent year-on-year to £58.31 in Phuket, the Thai resort has dropped just one place to sixth in the barometer table. Hoi An, Vietnam (£73.02) has retained 13th place with a 0.8 per cent drop in costs, while another fast-emerging Far East destination, Seoul in South Korea (£69.02), is just outside the top 10 at number 11.
Cancun returns to the top 10 in seventh place after a slump in the value of the Mexican peso. At £63.75, Cancun prices have plunged by over 11 per cent since last September to make Mexico cheapest in the Americas, followed by Costa Rica.
Although prices have risen 20 per cent in Tamarindo since last year, Costa Rica has maintained its top 10 position in eighth place with a barometer basket costing £67.41. Picked as one of its hotlist predictions in January’s Holiday Money Report, Post Office Travel Money sales of the Costa Rican colon have mushroomed by 46 per cent in 2015, making it the year’s fastest growing currency. With the introduction of direct Dreamliner flights from London this autumn, Costa Rica looks set to become a mainstream player in the long haul market.
However, elsewhere in the Americas, the falling value of sterling against the dollar has had a marked impact, not just on destinations in the USA but also in the Caribbean, whose currencies float with the dollar. To add to this, local prices have risen in most areas – by up to 23 per cent in the Caribbean (Jamaica, £105.56) and 30 per cent in the USA (Austin, £99.93).
As a result, Orlando, Florida (£70.12) was the only destination of 12 US and Caribbean ones surveyed to register a year-on-year fall in prices. A barometer drop of 7.5 per cent means the theme park favourite has moved up three places to 12th position in the table and is 42 per cent cheaper than Miami (£121.33), the most expensive US destination surveyed. Antigua (English Harbour) was highest-priced of six Caribbean islands. At £137.13, its barometer basket cost two-thirds more than in Tobago (£81.83), the most competitively-priced Caribbean destination.
Destinations ‘down under’ have traditionally been among the most expensive places for UK visitors. Now, thanks to a sterling surge that puts over 20 per cent more Australian and New Zealand dollars in the purse, the cost of goods has fallen heavily in both Darwin (£91.13 – down 16.8 per cent) and Auckland (£100.66 – down 24.3 per cent). As a result both have moved up the barometer table – Auckland to 24th place and Darwin to 20th position.
In their place the Middle Eastern trio of Dubai, Oman and Egypt join US and Caribbean resorts at the bottom of the Post Office Travel Money barometer table. Dubai was the most expensive destination surveyed at £167.10, while a rise of 15.2 per cent in Muscat has made Oman almost as pricey at £145.16. Although prices have fallen 8.5 per cent in Sharm El Sheikh to £107.32, this represents a rise of over 20 per cent over the past five years.