Guns, Germs and Recession: The Curse on Mexican Tourism

Guns, Germs and Recession: The Curse on Mexican Tourism

It was the last image the Mexican government wanted from one of its sunny seaside resorts. In the heart of Acapulco, soldiers fought a blazing battle against drug cartel thugs who sprayed bullets from Kalashnikov rifles and hurled more than 50 grenades. After hours of the warlike scenario, 13 gunmen, two bystanders and two soldiers lay dead on the concrete. Worst of all, the shoot-out happened in the middle of a sweltering Saturday night and less than a hundred yards from Los Flamingos Hotel, which in its heyday saw Hollywood stars such as John Wayne and Johnny “Tarzan” Weissmuller party until dawn.

Last weekend’s Acapulco firefight was only the latest episode of close urban combat in Mexico as cartel militias fight each other and the government for the bounty of the drug trade. But its time and place could not have been more unfortunate. After tourism was shattered by the swine flu scare, Mexico just two weeks ago launched a campaign to try and lure holidaymakers back to its paradise beaches. Under the name “Vive Mexico,” or “Long Live Mexico,” the $90 million effort is using such stars as Spanish tenor Placido Domingo and soccer ace Rafael Marquez to show off the golden sands. But while Vive Mexico has yet to have much international impact, the wild seaside shoot-out grabbed the attention of TV stations from Long Beach to London.

Until the early part of 2009, it was difficult to gauge exactly how many foreigners were scared away by the drug war and its piles of headless corpses. The global economic crisis may have done just as good a job keeping potential visitors at home. In any case, while tourism was hit in the first months of 2009, it was not devastated; for example, the Riviera Nayarit on the Pacific coast reported hotel occupancy in February of 83%, compared to 90% in the same month in 2008.

But then came disease. While the drug war may have given a few people the jitters, the swine flu sent many more running for their lives. As news of Mexicans sputtering to death on hospital beds shot round the world, tourists fled resorts in packed planes while many more upcoming holidays were canceled. Back on the Riviera Nayarit, hotel occupancy in May plummeted to 33%, compared to 70% in the same month in 2009. In some other resorts, it was down to single figures. And most of the visitors who did come were Mexicans — not foreigners. “It was like first getting a cough and then getting hit over the head with a shovel,” says Marc Murphy, director of the Riviera Nayarit tourist board.

Like most tourist officials here, Murphy complains the media painted Mexico in an unfairly bad light. He is quick to point out there have been no documented cases of any holiday makers being directly affected by the Mexican drug war. “Somewhere like Los Angeles has many more gang members and killings than the places the tourists visit here,” Murphy says. “But Mexico has got more negative coverage than most countries. There has also been some irresponsible and incompetent reporting.”

President Felipe Calderon is also critical of the media spotlight shining on Mexico. He was particularly incensed when Forbes magazine included Mexican trafficker Joaquin “El Chapo” Guzman on its rich list — he was put at No. 701 with an estimated net worth of $1 billion. “Magazines are not only attacking and lying about the situation in Mexico but are also praising criminals,” he said in March, following the Forbes choice.

Calderon is particularly concerned about the nation’s image because of the bottom line. In 2008, foreign tourists spent $13.3 billion here, the third biggest source of foreign income after remittances and oil exports. This year, all three of these moneymakers are being clobbered. While the price of petroleum nosedived with the crisis, the recession north of the border pushed Mexican remittances down by 18.6% in April compared to the same time last year. To add to these woes, Mexico’s manufacturing sector has been battered by a drop in spending in the U.S. In total, the Mexican government predicts the economy will shrink by 5.5% this year. But some private analysts speculate the decline might be over 8%, the worst dive since the Great Depression.

Calderon argues that the ability of Mexicans to deal with this challenge will be crucial to luring the tourists back. Personally launching the Vive Mexico campaign in his presidential palace, the President focused on selling Mexican character. “Let us tell the whole world that we are a strong nation, with a unique unity and identity,” he said. “That no matter how hard or difficult the tests we have to face, particularly at the present time, Mexico is united and will overcome them.”

See TIME’s pictures of the week.