A recent sharp narrowing of the gap in the U.S.-Canadian currency exchange rate has triggered an upswing in Canadian visitors to the Inland Northwest and has boosted expectations of more tourism spending here, economic observers say.


The Canadian dollar, or loonie, so named for the loon engraved on Canadas $1 coin, climbed to more than 91 cents to the U.S. dollar in trading about two months ago, the highest level since 1978. It had slipped back to about 88 cents as of last week, but that still leaves the U.S. a far more appealing vacation and shopping locale for Canadians than it was four years ago, when the loonie was worth a paltry 62 cents on this side of the border.


Figures arent readily available on how many more Canadians are visiting the Spokane-Coeur dAlene area this summer than in past years, but tourism promoters and representatives of businesses here that cater to Canadians say theyre seeing strong signs that the number is rising.


Yes, were seeing a return of the Canadian visitors, and I want to make sure our community is ready and embraces them with open arms, which we will, says Harry Sladich Jr., president and CEO of the Spokane Regional Convention and Visitors Bureau.


Sladichs impressions about the Canadian influx are based mostly on feedback from hoteliers here that the CVB works with. We have a monthly meeting with our partners, and they say theyre seeing a remarkable return, he says.


Separately, though, Sladich says British Columbia and Alberta for at least several months have been among the top five points of origin for people who come into the CVBs visitor center here. A year ago, he says, neither was in the top five.


Jonathan Coe, president and general manager of the Coeur dAlene Chamber of Commerce, says, We are seeing increased inquiries and visitations from Canadians. The exchange rate is helping. I dont have any quantifiable numbers, but anecdotally it is helping.


Art Coffey, president and CEO of Spokane-based Red Lion Hotels Corp., which operates 61 hotels, says, I think we are seeing greater travel from Canada. Anything that makes our products in the U.S. more attractive value-wise (to Canadians) is going to have a great impact on us.


Over the years, Coffey says, spending by Canadian visitors has been a very large part of Spokanes both retail and tourism dollars. He adds, I think were a bargain again.


Nancy DiGiammarco, spokeswoman for Silverwood Theme Park, located north of Coeur dAlene along U.S. 95, estimates the number of Canadian visitors there this season is up more than 30 percent from a year ago.


Perusing the theme parks records, she says the visitors have come from a far-flung mix of large and small cities in British Columbia and Alberta, including Edmonton, Calgary, Kelowna, Kimberley, Trail, Lethbridge, Red Deer, Creston, Cranbrook, and Castlegar.


This is a good thing for the Canadians that the dollars have kind of leveled out. I think now we are quite a bit more affordable, DiGiammarco says. Anecdotally, as a regular commuter on U.S. 95, she says, Im seeing more and more Canadian license plates.


Over a period of years, the theme park had seen a decline in the number of Canadian leisure travelers coming during the parks prime operating season, DiGiammarco says. To counter that trend, she says, the complex has been collaborating with other businesses and economic-development groups in North Idaho to invite Canadians down on an annual promotion tied to the Canadian Thanksgiving holiday on Oct. 9. During that promotion, Canadian money is accepted at par with U.S. money by participating businesses here.


There were times when we were seeing 3,000 Canadians down for that weekend, but that number fell off last year, perhaps because Canadians now feel able financially to visit the U.S. throughout the prime travel season, she says.


Our Canadian neighbors now have an opportunity to come here and spend more vacation time, which is a good thing, she adds.


Same-day car travel by Canadian residents to the U.S. has increased nearly 23 percent since September 2001, and overnight car travel by Canadians to this side of the border so far this year has been among the highest levels in nearly a decade, according to a news release issued last week by Statistics Canada, a Canadian government agency.


A study of Canadian travel released last December by the Washington state Department of Community, Trade and Economic Development found that about 94 percent of all Canadian visitors to the state in 2004 came from British Columbia, Washingtons northern neighbor. It also found a clear correlation between the exchange rate and visits to the state from that province.


Annual automobile travelboth day and overnight tripsto Washington by Canadian visitors through British Columbia border crossings declined steadily from 1992 to 2002, falling from more than 18 million trips to 5.2 million trips annually during that stretch, as the exchange rate climbed to its widest gap. That trend reversed over the next two years, as the exchange gap narrowed, with the number of trips from British Columbia to Washington increasing to 5.4 million trips in 2004, the study showed. Figures for 2005 werent available.


The study also found that overnight Canadian travelers visiting Washington spent $224 million in 2004, up more than one-third from two years earlier.


Roberta Brooke, director of the International Trade Alliance here, says, I think we all miss the Canadians coming down, so reports that those visits are rebounding after a long sluggish period are encouraging.


Our focus is trade, she says, and we see tourism as a very important part of that, as often trading relationships develop from personal relationships, just having familiarity with an area and its people.


She and Sladich both say theyd like to see a greater number of Spokane businesses be more Canadian-friendly with their currency exchange at the till.


We would love to see people either have two (cash) drawers or have their fancy calculators, such as Canadian businesses do to accommodate American visitors, and wouldnt that be a great marketing strategy? Brooke says. Its just a cultural sensitivity thing if nothing else.


Sladich says retail merchants in Canada strive to be convenient to American visitors, and, We want to make sure were reciprocating that. Also, with the exchange rate gap reduced to where it is now, he says, When you accept Canadian (money) at par, youre basically giving them a 10 percent discount, and the loyalty is huge.


He notes that the CVB has a Canadian-focused portion of its Web site where it lists businesses here that accept Canadian money at par.


The recent strengthening of the Canadian dollar reportedly is due in part to Canada having trade and budget surpluses, being a notable producer of raw materials at a time when demand for them is high, and having high interest rates that attract investment.


While a stronger loonie is having welcome effects here, its causing anxiety on the other side of the border. Along with cutting into Canadian tourism revenue from the U.S., it has had a simultaneous effect of increasing production costs for Canadian manufacturers while trimming the value of those companies shipments, which often are priced in U.S. dollars, according to various published reports.


The impact is heightened in that the U.S. is the primary market for an estimated 98 percent of Canadian mid-sized manufacturers that export goods. Corporate financial woes there caused by the currency exchange rate swing has led to lengthy discussion in Canadian business and political circles about the dangers associated with having the U.S. as virtually Canadas sole outside customer.


Contact Kim Crompton at (509) 344-1263 or via e-mail at kimc@spokanejournal.com.