In Europe, the Dollar Talks

And it's saying that travel is again affordable for Americans

For the past decade, an American in Paris has been an endangered species. Because of the steadily declining dollar, romance atop the Eiffel Tower--or whatever else might take a tourist's fancy--has been out of reach to all but the most stratospheric budgets.

This year, however, Yanks can strike up a new chorus of "I love Paris in the springtime"--or summer, or fall. Reason: the dollar is back in grace. The exchange rate has improved 31% since a year ago, making U.S. purchasing power greater than it has been since 1969; and last week's election victory by Franc,ois Mitterrand's Socialist Party gave the rate another jolt by further weakening the franc (see WORLD). Tourists have been quick to capitalize on the change. Despite stiff increases in transatlantic airfares, advance bookings from New York City to Paris are up 33%.

Among the attractions: a suite for two at the four-star Mayflower Hotel, one block north of the Champs Elysees, complete with terrace, breakfast, tax and service, costs $50.90 (scarcely $5 more than a Holiday Inn around Detroit). Lunch for two at an elegant restaurant (green salad, gigot d'agneau, Cabernet Sauvignon and chocolate charlotte) runs $40. More modest pocketbooks can find such cafe fare as a small quiche or an omelet at $2, a chef's salad at $3.55. A 14-block rush-hour cab ride comes to $2.25, sans tip.

While none of this is exactly in the rucksack range, it is affordable for many inflation-battered Americans. Says Dallas Housewife Beth Gilson, who is touring Paris with her insurance executive husband: "It's still more expensive than what I'm used to, but it's no more expensive than cities like San Francisco and New York." Even students are scrimping less. Susan Shafer, 19, of Michigan State University, who is on a ten-week foreign study program, shares a two-bedroom flat in the Latin Quarter for $16 a day, a price that includes two meals.

The new strength of the dollar is showing up in other nations as well. According to S.J. Taqi, editor of the Geneva-based Guide to Executive Travel Costs, Americans will find that "travel in Europe generally is going to be cheaper this year than for quite a while."

After several seasons of extraordinarily high prices, Americans in Denmark will get a break. The dollar has appreciated 22% against the krone, while prices at tourist-oriented hotels and restaurants have risen only 5%. A new service for tourists is Dan-menu, a standard two-course Danish meal in many restaurants in Copenhagen and elsewhere for about $7.

The dollar's strength against the lira more than cancels out Italy's inflation of 20%, so vacations there will cost about the same as they did last year. Even at that, Italy is still a relatively inexpensive place to travel by Western European standards. A first-class meal, including a succulent pasta, a main course of meat, fish or chicken, a salad, dessert, rich espresso coffee and a good bottle of Chianti, can easily be found for less than $26 per person. A meal in a more modest restaurant can go for as little as $8. Gasoline is high--$3.25 per gal.--but that is offset by fares on Italian trains: $14 for a first-class one-way ticket between Rome and Naples.

In some European countries, the dollar's strength has been softened by inflation. In always expensive Sweden, the dollar has risen 16% against the krone, but the cost of living index is also up 16% and still rising. A martini can cost $10, a fixed-price dinner $30 and a carafe of wine $8. There is some relief in McDonald's, where a family of five can feed on Big Macs for $21, and in Chinese restaurants, where a meal for two costs about $13. Hotels have countered with special rates for tourists: the Sheraton-Stockholm offers a double room with Continental breakfast for $60 a night as part of a four-night package deal. The normal rate for a single is a steep $138.

In England, higher exchange rates against the pound are of little help. Anyone trying to live in London on $5 a day would end up on a park bench with a couple of hamburgers, some French fries and a cup of coffee. A year ago the value of sterling peaked at $2.46. It has come down to about $2.10, still not low enough to attract Americans in the once familiar droves, even with Robert Morley's welcoming TV pitches for British Airways. The wry rule of thumb for U.S. citizens planning to visit Britain is to read U.S. prices in sterling: an item worth $10 in the U.S. will cost nearly 10 pounds ($21.60) in London, which now ranks as the world's fourth most expensive city (after Tokyo, Lagos and Buenos Aires).

The best bets for the American with wanderlust are the proliferating package tours. In Austria last winter, an eight-day ski holiday at Innsbruck (including airfare, hotel, ski-lift passes and some meals) cost as little as $750, comparable to what a Manhattanite might have spent for a trip to Aspen. In West Germany, where the dollar is up 25%, hotel rooms still run well over $100 a night in major cities, but trips to the more romantic countryside, where a comfortable room in a rustic inn may cost $15 (with breakfast), are a real bargain. One "wunderbike" trip takes the cyclist into the upper reaches of the Rhine and the Black Forest for seven days of wine sampling, castle viewing and visits to monasteries for $725, not counting airfare.

How long will the favorable exchanges last? As long as U.S. banks continue to offer higher interest rates than their European competitors, says Martin Oilman, an American economist based in Paris. If interest rates scale down as expected during the summer, so may the value of the dollar, which last week was worth 5.5 francs (vs. 4.9 last month). But, says Oilman, "with the American economy now growing faster than its competitors and sucking in more money from abroad, I don't see the dollar dropping below 5 francs this summer." Vive la difference!

This file is automatically generated by a robot program, so viewer discretion is required.