Spain to spend EUR 1 bn to reform tourism sector

27th February 2009, Comments 0 comments

The newly-announced budget of EUR 1 billion is more than double the amount originally planned, says Spanish industry and tourism ministry.

MADRID – The government of Spain will EUR 1 billion to reform the country's tourism infrastructure in 2009, more than double the amount originally planned, the industry and tourism ministry said Thursday.

In 2008, the government said it would provide EUR 400 million to hotels and other tourist sector establishments to help them modernise and face up to growing competition from cheaper sunshine destinations with newer establishments.

But the ministry said this amount had already been distributed so it would provide an additional EUR 600 million this year to the programme, which also aims to provide jobs for the tens of thousands of construction workers laid off after the collapse of a decade-long real estate boom in 2008.

"The granting of 100 percent of the planned credit in such a short period of time is evidence that the modernisation of tourism infrastructure is a key demand of the sector," it said in a statement.

Spain, the world's second biggest tourist destination after France, received 57.4 million visitors in last year, a 2.6 percent drop from 2007 and the first fall since the current record-keeping system was introduced in 1995.

The decline in visitors picked up pace in January, especially from Britain, Spain's main source of foreign visitors. A total of 2.6 million foreign tourists visited Spain last month, down 10.1 percent over the same month in 2008, according to industry and tourism ministry figures.

But the number of British tourists visiting Spain plunged by a fifth to 575,037 during the same period due to the weakening of the pound to near-parity with the euro and the recession.

The tourism sector accounts for about 11 percent of Spain's jobs and gross domestic product with the bulk of the industry's income generated in Spain's ageing "sun and beach" destinations that dot its southern coast.

AFP / Expatica

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