Two years ago I kept saying that if you were American or someone earning their pay in U.S. dollars, it was one of the best times I’d seen in 20-some years to go traveling internationally. It was not a time to stay home, to only travel close to home, or to bank your vacation days for a better time. It was highly unlikely to get any better in terms of what you could get for your greenbacks. If you were thinking of taking off on a trip around the world, 2016 was one of the best windows ever.
Then Trump got elected and put a quick end to that. Almost immediately the dollar started declining on the world markets and it’s been in a funk ever since. It’s not all because the world hates him and he’s a reckless leader that has an aversion to the truth. The price of oil rising, our interest rates are rising, and our economy has been on a roll for years, which could lead to inflation. Plus we don’t operate in a vacuum: many other economies have been getting healthier too. We’re actually the only developed nation in the world adding to our deficit right now, thanks to a tax cut for the rich. Our conservative party in power is going on a borrowing spree due to declining tax revenue—in a boom time.
But enough back story. Where can we still find a good travel deal abroad with our U.S. dollars?
There are still two ways to play it where the deals are good. 1)You can stretch your travel funds as far as they’ll go and maybe extend your time away by visiting the best bargains, The World’s Cheapest Destinations.
2) The other option is to visit a place that is on the expensive side, but is temporarily less pricey. Perhaps before it was way out of your budget, but now you can make it work, so you go to your dream destination while you can.
The pickings are much slimmer than they were when the world liked us and liked our treasury bonds, but here are the best bets this year for both scenarios: shoestring travelers and those taking a dream vacation. There’s at least one of each for all the continents except Antarctica. (That trip is always expensive; currencies don’t matter.)
Bargain Travel Leader – Nicaragua
“Up and to the right” is a chart that growing businesses like to show to investors: over time their revenues are rising at a rapid rate. Unfortunately for Nicaraguans, that’s what the currency chart always looks like for the greenback against the Nicaraguan cordoba. At the beginning of 2011 a buck got a shade less than 22 cordobas. In 2016 it got you 28. In May of 2018, 31.
That equates to a big rise in buying power, in a country that was already about the cheapest in Latin America. As a bonus, flights to there are competitive (especially if you suck it up and go on Spirit Air), or you can go overland from Costa Rica or Honduras on your way north or south. They had some violent protests in the capital lately, which always scares off jittery tourists, so you’ll probably find plenty of cut-rate hotel deals too.
Splurge Deal – Canada
As recently as 2013, the Canadian dollar was above par with the U.S. one, meaning you had to spend more than one greenback to get a loonie. Most of this year it has been between 125 and 128. Trade in $100 and you get $125 or so.
This erases the premium that you usually have to pay in Canada due to higher taxes, higher labor costs, and more regulated imports. At the beginning of this decade it was a splurge to head north to Canada and hotels were routinely much higher than in comparable U.S. cities. Now you can find deals on highly rated hotels for under $100 even in the middle of the summer.
Plus you have the added advantage that you can drive there on cheap gas and avoid our unpleasant airlines and the TSA. Road trip!
South America on a Strong Dollar
Bargain Travel Leader – Peru
Bolivia’s really the cheapest but it’s running on coca fumes these days and leaves a lot to be desired in terms of infrastructure and service. Colombia’s currency has dropped the most, but prices there were higher than many countries to the south to begin with. Peru’s currency has only dipped from around 3.3 to the dollar to 3.5, which is still at the high end of the scale for the past 15 years. These travel prices in Peru I posted three years ago are even lower now in dollar terms. Apart from some inflated sightseeing costs around Cusco and the Sacred Valley that are geared to what the moneyed tourist market will bear, it’s a fantastic value.
Splurge Deal – Brazil
Brazil is one of the few bright spots around the world for the greenback this year, with the dollar’s value against the real rising back up to where it was this time two years ago. You’ll still get hit with their high reciprocal visa fee to enter though, so plan on sticking around for a while.
You probably want to get beyond the big cities too in order to get a good bang for your buck. Even after hosting the World Cup and the Olympics, Rio is notoriously underserved in the hotel department, plus the city suffers from more daily crime issues than the others.
Europe on a Strong Travel Dollar
Bargain Travel Leader – The Balkans minus Croatia
I spent last summer traveling around Bosnia, Montenegro, Albania, and Croatia and apart from that last one, was amazed how cheap everything was for every travel dollar I changed. The war in the 1990s had a devastating effect on the area and the economies are still in recovery mode. The tourism infrastructure keeps getting better though and there are enough young people around speaking English that it’s pretty painless to travel independently. See my posts on prices in Bosnia and travel prices in Montenegro to get a feel for the deals.
Really though, you won’t get hit all that hard if you head to the Czech Republic, Slovakia, Bulgaria, Hungary, or Romania instead. Most of their currencies have risen in tandem with the euro, which is 1.18 to the dollar as I write this, but they are still a terrific value. You won’t run out of the things to see and do and you’ll spend far less than you would vacationing at home.
Splurge Deal – Sweden
Our temporary good times are over for now when it comes to the euro, but not every currency on the continent is tied to the euro, including Sweden’s. This time in 2016 the krona was around 8.5 to the dollar and it’s back around that same level again. That doesn’t mean the place is a bargain—this is Scandinavia after all—but it’ll feel like New York City when you go out for a meal or a drink, not some parallel universe where the price of everything got doubled.
And hey, there’s not much nighttime in Stockholm in the summer, so you can really make the most of your time there.
Asia Strong Dollar Options
Bargain Travel Leaders – Nepal and India
Travel prices in Nepal are perpetually cheap. This is probably the least costly country in Asia. They could also really use your hard currency. Nepal has had a rough decade with a series of earthquakes that wiped out half the country’s GDP and climbing accidents that have done even more damage to mountain communities. I’ll be going back there soon to speak at a tourism conference and am looking forward to hearing some good news about the region.
Nepal’s currency bounces around wildly for no apparent reason, but it’s generally been betwen 100 and 108 the past couple years. Here’s the kind of hotel you get when paying $7.12 per night double in Pokara in June on Hostelworld:
India is a perpetual bargain too for backpackers, but it’s also one of the rare countries where a dollar gets you as much of the local currency now as it did in 2016. If you visit these two countries in tandem, you could literally travel on a budget for a year for what you spend on a couple months of living expenses at home. And have some left over…
Travel Splurge Deal – Japan
Although the yen has bounced up and down a bit on world news, it’s often around 110 to the dollar, which keeps the country from seeming insanely expensive right now. Japan has traditionally been one of the world’s most expensive travel destinations, yet it’s also one of the most interesting. So travelers who have sucked it up and paid have found it well worth the splurge.
Right now it won’t hit you so hard for your night of Kirin beers and yakatori or to slurp a bowl of noodles with the lunchtime crowd before visiting the temples of Kyoto. It helps to limit your time in Tokyo and get into the smaller cities instead.
Travel Deal – tie: Morocco and Egypt
After running between 8 and 8.5 dirham to the dollar earlier this decade, Morocco’s currency briefly topped the 10 level two summers ago. It has only dropped to around 9.4, which isn’t very noticeable to most visitors. This is in most respects the best value on the continent apart from Egypt, so now you can get even more for your budget. This country has far more to offer travelers than most in Africa, from ancient cities to desert dunes to mountain hiking. Plus the food is good. Just understand that hotels are more likely to be pegged to the euro than the dollar. Still, here’s a $33 double room in Marrakech:
Egypt is hurting for tourists these days and only the most intrepid have come back. It’s a screaming bargain though if you’re willing to go there and you can see the ancient temples without fighting a thousand others around you. Their currency has been rock steady the past year and a half against the dollar, between 17.5 and 18 Egyptian pounds.
Splurge Deal – Tanzania
Good times for the travel dollar may have come to an end in South Africa, but it’s a different story in the safari destination of Tanzania. The U.S. dollar is actually worth a bit more there now than it was two years ago, so this might be the time to book that epic wildlife trip. (In comparison, prices have gone up in competitor nation Kenya.)
Australia/South Pacific and the U.S. Dollar
Travel Deal – Fiji
Fiji is one of the countries where Americans can stay four months or more on a tourist visa, so this is a place to combine slow travel with island hopping and perhaps hiking in the mountainous interiors. This is not a backpacker-level bargain like you’ll find in Southeast Asia, but they do grow a lot of their own food here so it’s not a place where everything has to be imported. When I visited two years ago, I was pleasantly surprised by the prices for groceries, food, taxis, and local beers.
The Fijian dollar tends to bounce up or down 5% on a regular basis, but generally trades in a range between 2 and 2.10. In a part of the world that’s known for sometimes sky-high prices for everything, non-luxury hotels and restaurant meals here feel relatively normal when it’s time for the bill.
Travel Splurge – Australia
For the first few years of this decade, the Australian dollar was at or above par with the greenback, but as I write this, one Ben Franklin $100 will fetch you more than 130 Aussie dollars. It’s been a long time since anything in Australia has been considered cheap, but now you won’t have a heart attack when you get your dinner bill.
The big kicker here (and for Fiji or New Zealand) is the flight cost, not to mention the time spent in transit on that flight. Check prices here for most of the international options, but figure you’re going to pay north of $1,100 round trip unless you find a great deal. If you have the time, get a “circle the pacific” deal instead and make several stops.
How about you? Where have you gotten more than you expected from your travel dollar when vacationing abroad?