In your in­ter­est: Paul Clitheroe

Money Magazine Australia - - CONTENTS -

We all know the old say­ing that at times it is hard to see the for­est for the trees. I am cer­tainly guilty of this. The amount of mi­cro de­tail in the world of money is grow­ing and grow­ing. The changes to su­per­an­nu­a­tion had me well and truly in mi­cro fo­cus mode up to June 30, along with var­i­ous pro­nounce­ments about cap­i­tal gains tax, neg­a­tive gear­ing and later trusts. Add mar­ket and cur­rency volatil­ity and it would be fair to say I had lit­tle time to pon­der what I be­lieve re­ally adds value to in­vest­ment re­turns – a long-term per­spec­tive.

So it was with some re­lief that I left th­ese is­sues be­hind and, with my wife Vicki and some very old friends, headed off to the Baltic and then, even bet­ter, into the Arc­tic Cir­cle for some kayak­ing in the sea ice. I should pause here and tell you that this was not even a vaguely brave move. First, we were in an ice-re­in­forced ex­pe­di­tion ship; we had break­fast, lunch and din­ner on board, as well as a nice warm bed!

Not be­ing a fan of the po­ten­tial to roll in zero-de­gree wa­ter at a lat­i­tude of 80 de­grees north, we kayaked in full dry suits, and not at all if it was blow­ing a gale. So much for an ad­ven­tur­ous life. But it was a great ex­pe­ri­ence, with ice, po­lar bears, wal­ruses, seals and whales. Even bet­ter, there were ab­so­lutely no com­mu­ni­ca­tions for nearly two weeks. With­out a minute-by-minute del­uge of news I had a chance to mull over the long-term out­look.

I am a big fan of the sim­ple. The sim­plest fact is that the world pop­u­la­tion is grow­ing at some 90 mil­lion peo­ple a year. De­spite all the bad news, some of it heart-wrench­ing, an­other sim­ple fact is that poverty is dra­mat­i­cally lower. The av­er­age wealth of a global cit­i­zen is also strongly on the rise.

I have been for­tu­nate to travel a lot and it is easy to feel the pres­sure of wealth and a grow­ing pop­u­la­tion. In St Peters­burg, Tallinn, Gdansk or any at­trac­tive city you care to name, it is ba­si­cally stand­ing room only at ma­jor tourist sites. I have spent a bit of time in St Peters­burg over the years – it is an amaz­ing city. There were five mon­ster cruise lin­ers in town, as there are ev­ery day in sum­mer, and our Rus­sian guide told me the port fa­cil­i­ties would be ex­panded to al­low for up to 15 ever-big­ger lin­ers. Out­side what I would re­gard as a mi­nor at­trac­tion I counted 47 tourist coaches, with more cir­cling. Thank heav­ens I had been there some years ear­lier, so I could just watch the hordes in amaze­ment.

But there is im­por­tant in­for­ma­tion here about fu­ture in­vest­ment. Clearly tourism will be a huge gen­er­a­tor of jobs and rev­enue. The “own­ers”, by which I mean the res­i­dents, of the great global at­trac­tions will have to put quo­tas on tourist ar­rivals, a most in­ter­est­ing new source of rev­enue.

It is very clear that busi­ness and in­vest­ment op­por­tu­ni­ties abound. “Mass tourism” is rapidly lead­ing to what I would call “mid­dle class exclusive” tourism. As larger num­bers of us ex­pe­ri­ence more travel, I have no doubt many of us will pay a bit more for a smaller-group ex­pe­ri­ence like my Arc­tic kayak ex­pe­ri­ence.

So my radar has turned with in­ter­est to how we can in­vest in this ob­vi­ous growth area. We can al­ready in­vest in air­lines, cruise ship com­pa­nies and so on but tourism is go­ing to be one of the great themes of the fu­ture, so I am go­ing to do a bit more dig­ging around and I’ll re­port back. For ex­am­ple, big cruise ships are not re­ally my thing but they are loved by mil­lions of peo­ple. So just think for a minute about the food and bev­er­ages that they need as they stop and the ben­e­fits to lo­cal sup­pli­ers, restau­rants, taxis, travel com­pa­nies, tourist shops and so on. And they are only one part of travel. Air­ports, also an eco­nomic mir­a­cle, seem to me to be the new world shop­ping malls.

I am not in the busi­ness of travel tips but one thing firmly in my mind is the need to go to ma­jor tourist des­ti­na­tions in the shoul­der sea­son. And I sus­pect in a decade this may need to be win­ter. Even for the Arc­tic or Antarc­tic, where for now you at least will get peace and quiet, you’d bet­ter book early to get a small-ex­pe­di­tion boat ex­pe­ri­ence, or pre­pare to be on a wait list.

Paul Clitheroe is Money’s chair­man and chief com­men­ta­tor. He is also chair­man of the Aus­tralian gov­ern­ment’s Fi­nan­cial Lit­er­acy Board and a best-sell­ing au­thor.

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