Is the EU Recession Affecting Spanish Tourism?

March 13th, 2013

Tourism, one of the two engines buoying the Spanish economy, is beginning to show signs it is being affected by the eurozone recession and has now registered four consecutive months of declines in the number of foreign tourist arrivals, with the exception of the ‘zero growth’ registered for November.

The negative trend, which began with the decline of 3.2% recorded in October of last year, seemed to slow down with the zero growth (0.2%) recorded in November, only to fall again by 1.3% in December and by 2.6% in January, according to the latest official data.

Tourist arrivals thus fell by 1.7% in the last quarter and, unlike the fall of April, which was explained by the change in dates of Easter week, this time there was no seasonal factor to account for the negative trend.

In addition, the arrivals of tourists from the United Kingdom and Germany, Spain’s first two source markets, registered more significant declines, falling by 4.6% and 6%, respectively, in the month of January. This is suggested to be due to the negative growth of their economy in the last three months and rising unemployment beginning to affect their travel demands.

Also notable are the declines of 29.3% in tourist arrivals from Italy (accumulating six months of decreases), and of 22% in tourist arrivals from the Netherlands. These four source markets account for 43.3% of all international tourists in Spain.

In the last month, the only major country to improve its tourist arrivals to Spain is France, the third largest source market providing 15.3% of the total, which grew by 6.7%, and continues the growth trend shown in 2012. The closeness between the two countries and the possibility of access by road are the reasons for this increase in French tourists, the majority of whom head for Catalonia, while those choosing Andalusia as their destination decreased in number.

By destination, El Economista reported that the Canary Islands, Andalusia and Madrid are the regions most affected due to the drop in the number of German and British tourists.

The decline of the German economy is also reflected in the spending of the German tourists in Spain, which fell by 3.9% during the month of January. In contrast, British tourists’ spending increased by 2.3% despite the decline in arrivals.

Interestingly, despite the decline in the number of tourist arrivals, the volume of international tourist spending rose by 6.5% in January to 2,826 million euros, compared to a year earlier. An apparent contradiction due to the increase in VAT – which took effect in July – and transport prices and, to a lesser extent, by the boost in spending by tourists from France, Scandinavia and Latin America, which was accompanied by a significant increase in arrivals, although in the case of the Latin Americans their contribution to the total number of arrivals is still relatively insignificant.

Average spending per person also increased by 88 euros, compared to January 2012, while the average daily expenditure was 10 euros more. Sources from the Ministry of Tourism admitted, however, that if the transport expenditure component was subtracted, the increases, although still positive, would be gentler.

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Comments

  1. 19/03/13 21:18   Roy Forsythe

    Talking to a lot of our friends in Hondon de las Frailes Costa Blanca where we live re the Cyprus affair the unanimous verdict is that if the Spanish Government even consider taxing our money we would certainly give considerable thought to up sticks and leave and this village where we live would DIE because the mayor told us 10 years ago that it was the the ex-pats arrival which saved it and with our money the village has prospered.If this was repeated across Spain then they would regret it forever.If we left that would mean our relatives would not come here for their summer holidays either and then were would their economy be.


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