Greenbacks abroad: There are still some bargains
By now everyone probably knows that the U.S. dollar is in rough shape in Europe, where it declined another 10.3 percent in 2007 against the euro. It did even worse against the currencies of Turkey, the Czech Republic and Norway. The dollar’s troubles spread to other parts of the world as well, with nose dives of 15 percent or more in Canada, Brazil, Mauritius, Thailand and the Philippines. Worldwide, the U.S. dollar declined 10 percent or more against 53 foreign currencies last year.
While the overall picture is glum, there are parts of the world where the U.S. dollar is doing just fine. If you are making foreign travel plans now for the coming year, you might want to look at these bright spots on five different continents.
Mexico, the Caribbean and Central America
Americans fortunately do not have to go very far to pretend the greenback’s decline never happened. Most of the countries in the closest international region have currencies that are pegged to the dollar or trade in a narrow band. The dollar was actually up last year in Mexico, Nicaragua, Bermuda and Jamaica. Panama uses our currency as its own, and Belize’s dollar trades at a 1-to-1 ratio. Most of the Caribbean islands that are not affiliated with European nations are locked into a fixed exchange rate with the United States.
South America
Head farther south and the picture is still good overall in Spanish-speaking South America. The dollar was up 3 percent in Argentina last year and this country remains one of the best travel values around. Declines in Chile, Peru and Bolivia were far less than those in other parts of the world, and Ecuador uses the U.S. dollar as its currency.
Asia
For nearly a decade, Asia has been a safe bet currency-wise, but things got more complicated in 2007. The dollar tumbled in Thailand and India, though these countries still remain two of the best values on the planet. The dollar was up a tad in South Korea, Hong Kong, the Maldives and Indonesia, and remained stable against many other nations’ currencies. Overall, the countries of Southeast Asia — including Vietnam, Laos, Cambodia and Malaysia — should remain a bargain throughout 2008.
Africa
Most organized trips to Africa (such as safaris) are priced in U.S. dollars, so tourists seldom see major shifts in prices. For independent travelers things have gotten a little worse, but apart from Tanzania, probably not enough to cause a change in plans. Last year the dollar declined 8.5 percent in Morocco, 3.1 percent in Egypt, and only 2.4 percent in South Africa.
Europe
Things in Europe are downright ugly no matter how you look at it. This is a year to hunt hard for bargains and carefully choose your destinations. Your travel budget will stretch the most in Portugal and the countries that have not yet adopted the euro, including Bulgaria, Hungary and the Czech Republic. Romania’s currency gained only 4.3 percent on the dollar in 2007, but if you’re looking for a place where the greenback rose, you have only one choice: Belarus.
The currency picture is only part of the story, of course. A decline in the dollar exchange rate in a country that is already a bargain — such as Peru or Egypt — is not going to be felt the same way as it would in Japan or Western Europe. As you make travel plans for the new year, however, it makes sense to go somewhere that makes you feel like you’re carrying a bundle of cash rather than a stack of Monopoly money.
Tim Leffel is author of the books Make Your Travel Dollars Worth a Fortune and The World’s Cheapest Destinations. He also edits the award-winning narrative Web ‘zine Perceptive Travel.
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Small nit-picky correction: The Belize dollar is pegged at two to one US dollar.
[...] in January, we ran a story about where those of us carrying dollars could still find a travel bargain abroad. Things have already gotten worse, with the euro blasting past the $1.50 mark and the dollar [...]