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The European's pleasure of paying in dollars 28/03/2008 00:00

Spaniards are chief amongst the shopaholics leaping onto planes to flex the euro's spending power

Jorge Llombart still gets excited when he recalls all the items he brought back from the Big Apple. Jorge is one of the many Spaniards who travelled to New York over the Easter holidays "just to go shopping."

It was the seventh time that the 36-year-old, who runs a home decorating store, had visited the city, and this time round he noticed "a huge change" in prices. Like most fellow visitors, he returned home laden with electronic products and brand-name clothes that are difficult to find in Spain, such as GAP or Abercrombie & Fitch.

"And they weren't just for me, either. Most were things that my friends had asked me to buy for them," he adds, explaining that he carried several empty suitcases to New York, packed one inside the other like Russian dolls, and brought them back full of goods.

"They grumbled a bit at customs because they said I had too many things, but in the end they let me through."

Travelling to the United States is in fashion. Last year, tourist arrivals totalled a record-breaking 56.7 million people.

Tourism figures had been stagnating for the last seven years, but the weakness of the dollar against the euro has convinced many Europeans to visit North America, where they can get USD 1.55 for every euro, compared with less than 90 cents on the European currency's introduction in January 2002. Some people make the trip of seven hours or so just for the shopping, lured by affordable hotel prices and cheap technology.

Nearly 11 million Europeans arrived in the United States in 2007 - including half a million Spaniards - a 22-percent rise from the year before, according to the World Tourism Organisation (UNWTO). And all signs point to a continuation of the upward trend in 2008.

New York is the most popular destination, and last year the city welcomed a record 8.5 million overseas visitors, most of whom were European, according to local tourism authorities.

An iPod Nano, Apple's popular multimedia player, costs USD 149 at the company's flagship store on Fifth Avenue. That is around EUR 95 at current exchange rates, when the same gadget is selling in Spain for close to EUR 140. Consequently, Spaniards bring it back stowed away in their luggage like treasure, together with pairs of Levi's jeans and Nike shoes. Savings on those kind of products compared with shopping in Spain can reach between 30 and 40 percent.

"Spending patterns at destination are very elastic depending on prices, and in good conditions in terms of a favourable exchange rate, spending can grow by 20 to 30 percent," says Eulogio Bordas, a representative of the tourism consulting firm THR.

The price of a plane ticket to the city that never sleeps is still high, starting at EUR 500, but according to the investment firm UBS, once there, the cost of living excluding rent is very similar to Spanish cities such as Barcelona. This favourable contrast is partly because of the dollar's depreciation, but also because of rising inflation rates in Spain.

"The dollar no doubt has a lot to do with the rise in tourist arrivals, because Europeans can now obtain more items for less money. But in Spain's case, its own economic situation is also a reason," explains John Kester, the UNWTO's chief of market trends and competitiveness.

Kester argues that a parallel rise in the standard of living and the cost of living has allowed Spain to bridge its former economic gap with foreign countries, encouraging more Spaniards to travel abroad.

"They're not just going to the States more often. People are also going to countries where the dollar is influential, such as Argentina or Mexico," adds THR consultancy's Eulogio Bordas.

"In the last few weeks we have seen a 40-percent increase in the sales of flights to destinations such as New York or Miami," confirms Virginia Barbancho, an executive at the online travel agency Rumbo. Besides a favourable exchange rate, tour operators point to numerous offers by leading US, European and Spanish airlines.

Susana Hernández did not go to New York to shop, but to visit her eldest son who is studying there. But in the end she and her husband did purchase a few consumer items, she admits.

"You feel looser when it comes to spending money, because eating is not expensive at all when you think about the exchange rate," Hernández points out.

These days, eating at a terrace in Soho, one of the trendiest areas in town, costs around USD 25, less than EUR 16.20. The standard menu at a fast food restaurant is around USD 5.00, or EUR 3.20. In Spain the same meal would cost around 50 percent more.

And hotels are more affordable, too. Although the average price for a room is still higher than in Spain (EUR 210 compared with EUR 138 in Barcelona, according to a global trade report by the online travel agency Hotels), there are still good deals to be found, especially on the internet.

For those who make their travel plans near the time of departure, it is still easy to find hotel accommodation in New York for the month of July for around EUR 100, while a bed in a youth hostel will set you back a mere EUR 25.

"The biggest expense is the plane trip, but once you're there you can move around with very little money," explains Oriol Alcorta, a Catalan student who is planning a summer trip to North America this year.

He wants to spend two months the other side of the Atlantic, and will stay for the first few weeks at a student residence that is charging him around USD 500 dollars, or EUR 320.

"Once I'm there, I will take domestic flights and buses, which are cheap because you pay for them in dollars," Alcorta explains.

The allure of great shopping deals is even making some people forget some of the big inconveniences of entering the United States.

"Security measures are still excessive. They treat you like dirt, and force you to spend hours standing in line. But in the end, you put up with it," says Jorge. Only a week has gone by since he returned from Manhattan, and already he is planning his next visit. "Before the year is out I've got to go back," he says.

[March 2008]

[Copyright dpa / CRISTINA DELGADO 2008]

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