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Tourism revenues on the mend in Mediterranean countries
Global Banking & Finance Review®
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(Reuters) – Even if the number of visitors has still not quite recovered to pre-pandemic levels, Mediterranean countries are enjoying a much-needed boost as inflation and a strong sector recovery lift this year’s tourist spending and tax receipts higher.
(Reuters) – Even if the number of visitors has still not quite recovered to pre-pandemic levels, Mediterranean countries are enjoying a much-needed boost as inflation and a strong sector recovery lift this year’s tourist spending and tax receipts higher.
The positive trend is one factor lending support to the heavily indebted economies of the region as they grapple with a spike in energy prices hitting both consumers and businesses.
Spain on Monday reported that it received nearly nine million passengers through its international airports in August – about 87% of those who arrived in the same month of 2019.
But higher prices meant tourist spending stood at 11.26 billion euros ($11.16 billion), nearly twice that recorded the same time last year and only fractionally down on August 2019.
Spain expects tourism revenues to hit 151 billion euros this year, 98% of pre-pandemic levels when the tourism activity earned the country 154 billion euros, according to Exceltur, which groups major Spanish hotel chains, travel agents, tour operators and airlines.
The number of visitors to neighbouring Portugal beat pre-pandemic levels in July for the first time since the end of most COVID-19 restrictions, the National Statistics Institute (INE) noted of 1.8 million foreign arrivals that month.
That recovery, plus the impact of inflation, contributed to a 21.6% jump in tax revenues to 5 billion euros.
Italy’s tourist industry lobby Assoturismo estimates that 49 million tourists spent at least one night in a hotel during the June-August summer period – still 6.9% lower than in 2019.
Yet separate data from the tourist industry association Federturismo confirmed the same pattern as elsewhere: revenues from foreign tourists during the period almost returned to their pre-COVID, levels, with a decline of just 0.9% from 2019.
Greece’s finance ministry expects tourism revenues to top 18 billion euros this year, beating their 2019 record. Net budget revenues for the first eight months of the year came in at 39 billion euros, some 5.6 billion euros above target, thanks to higher-than-expected tourism receipts and higher VAT revenues.
The conservative government however has promised to spend the biggest part of the fiscal boon on energy subsidies.
($1 = 1.0088 euros)
(Reporting by Sergio Goncalves in Lisbon and Corina Pons Rodriguez and Belen Carreno in Madrid; Lefteris Papadimas in Athens; Angelo Amante and Gavin Jones in Rome; writing by Mark John; editing by Mark Heinrich)
Tourism refers to the activities of people traveling to and staying in places outside their usual environment for leisure, business, or other purposes, contributing significantly to local economies.
Economic growth is an increase in the production of goods and services in an economy over a period of time, often measured by the rise in GDP.
Financial stability refers to a condition where the financial system operates effectively, allowing for the smooth functioning of financial markets and institutions without significant disruptions.
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