Obama’s Push to Speed Visa Approvals Could Boost U.S. Retail Sales, Create Jobs
President Barack Obama’s efforts to speed up tourist visas for Chinese and Brazilian shoppers would create an “immediate” surge in retail sales, said Bloomingdale’s (NYSE:M) CEO Michael Gould, whose department store chain is already preparing for a potential boom by tailoring merchandise to Brazilian and Chinese tastes and advertising outside the U.S. for the first time.
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“We’re expecting an enormous uptick in growth,” said Gould. “We have the kind of brands that are highly respected by these visitors, and the faster they can get here the better.”
On January 19, Obama signed an executive order giving the Department of Homeland Security and State Department 60 days to come up with a plan to speed up the processing of visa applications from China and Brazil. The order recommends shortening the application process from four months to just three weeks.
The National Retail Federation projects that the resulting increase in tourism will create 1.3 million jobs and add $850 billion to the economy by 2020.
However, Obama’s order has met with opposition, with the Federation for American Immigration Reform saying calls for less stringent screening increase the potential for “terrorism and visa overstays.”
The U.S. share of global tourism fell to 11 percent from 17 percent between 2000 and 2010, spurred by stricter security following the September 11 terrorist attacks.
Retailers like Saks (NYSE:SKS) and Macy’s (NYSE:M) have had to watch as Chinese and Brazilian shoppers traveled to cities like Paris and Rome where the wait time for a visa is about 10 days. Now Obama’s plan could help the U.S. gain back some of its share of the global tourism market — a boon for luxury retailers and hotels.
The NRF has over the past year been lobbying Congress on behalf of retailers to support loosening the visa wait time. Meanwhile, retailers have been preparing tailor assortments to include flashier name brands and logos to appeal to overseas tourists, who tend to prefer prominent logos on iconic American brands.
The U.S. is already witnessing a surge in visa applications. Chinese applications rose 34 percent in 2011 from the year earlier, while Brazil’s requests rose 42 percent. As their economies continue to grow as the U.S. dollar weakens, that trend is bound to continue.
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