Foreign spending to be hit by world events

Foreign spending in the UK will be affected by international events

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The Beijing Olympics and Ramadan and the US presidential election will all have a dramatic affect on foreign tourist spending in the UK this year.

Tax-free shopping specialist, Global Refund told retailers last night that the Chinese would defer their foreign travel until after the Beijing Olympics. Last year Chinese tourist spending in the UK grew by 37%. This year Global Refund predicts growth to be lower at around 13%.

Global Refund country manager Nigel Dasler said: "There will be an Olympic effect, but after the Olympics and in the run up to the national holiday Golden Week at the end of November we expect to see a significant surge in Chinese tourists to the UK."

With Ramadan falling earlier this year, Global Refund said it expected traditional Middle Eastern visitor spending in July and August to be consolidated and that Middle Eastern visitors would not re-enter the market until the end of September and the beginning of October.

US visitors to the UK declined by 13% last year due to the strength of the pound against the US dollar. However Global Refund predicted that in 2008 there would be some bounce back although it will come late in the year as Americans do not tend to take holidays in the six month run up to a general election.

London is the centre of tax-free shopping with 80% of total UK spend. Total tourist spend in the UK is £16.3 billion with £2bn of that being tax-free but only a third of people eligible bother to get a tax-free refund.