Spain predicts sharp drop in summer tourism

30th May 2009, Comments 0 comments

Spain, the world's second largest holiday destination, on Friday forecast a 10-percent fall in tourist arrivals this summer as the economic crisis hits its main source markets.

MADRID - Spain, the world's second largest holiday destination, on Friday forecast a 10-percent fall in tourist arrivals this summer as the economic crisis hits its main source markets.

The government also announced that funding for a loan scheme announced in January to upgrade tourist infrastructure would be increased from EUR 400 million to one billion (USD 563 million to 1.4 billion) in a bid to "soften" the impact.

The scheme is aimed at hotels and other tourist sector establishments to help them modernise and face up to growing competition from cheaper sunshine destinations.

"The tourist sector is not immune to the international economic crisis. Countries from which we receive tourists are also suffering, and there is an inevitable effect on the sector," Deputy Prime Minister Maria Teresa Fernandez de la Vega said.

In particular, she said unemployment had risen sharply in the European Union, Spain's main source market for tourists.

She said the government has forecast 23.3 million tourist arrivals this year, 10 percent fewer than in 2008.

For the first four months of the year, tourist arrivals were already down 12 percent from last year at 13.4 million.

Domestic tourism was up for the period however, helping to compensate for the drop in international arrivals.

Spain is the world's second biggest tourist destination after France. The tourism sector accounts for about 11 percent of the country's jobs and gross domestic product.

In 2007, it reported a record 59.2 million visitors, before the global economic crisis. But this fell 2.6 percent to 57.41 million in 2008.

AFP / Expatica

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