The fact that Spain is the second largest tourist destination in the world is not by chance. This prime position is the result of many factors, such as a diverse supply, good quality infrastructures, competitiveness prices and perceived security and safety. Of all these factors, Spain's geographical location has historically been key to the development of its tourism industry: besides warm temperatures throughout most of the year, Spain is located in the region where most tourists come from in the world (the European continent accounts for 48% of the global outbound tourism, according to data from the UN World Tourism Organization, UNWTO). However, Spain is not the only destination that benefits from this privileged geographical location since many countries around the Mediterranean, throughout southern Europe, the Middle East and North Africa, have also significantly developed their tourism industries. So much so that the Mediterranean basin has consolidated its position as the world's main tourism hub, recording 269 million international tourist arrivals in 2018, 19.7% of global tourism1 .

Since 1995, the Mediterranean region has been growing almost continuously at an average rate of 4.9% per year. The only exceptions were 2009, because of the global financial crisis, and 2016 because of the strong upsurge in internal instability in Turkey and Egypt. According to UNWTO estimates, in 2019 the Mediterranean tourism industry continued to attract more tourists, growing by 5.8% compared to 2018 and strengthening its position as an international tourism hub.

One of the factors affecting the trend in the Spanish tourism industry in recent years has been the situation in Egypt, Tunisia and Turkey. Spain's boom in international tourism between 2011 and 2016 coincides with a long period of instability suffered by Egypt and Tunisia following the Arab Spring of 2010, as well as the episode of insecurity suffered by Turkey between 2015 and 20162 . During this time, the perceived lack of security and safety by tourists reduced tourism's growth capacity in these three countries, to the point that the volume of inbound tourism fell at an average annual rate of 4.2% between 2011 and 2016. This reduction in competition for Spain helped its number of international tourist arrivals to rise at a considerably fast rate of 6.1% per year.

This beneficial situation for the Spanish market came to an end in 2018. Egypt, Tunisia and Turkey once again posted record levels of inbound tourism, growing annually by 15.6% as a whole. The competitive environment of the previous years altered once Egypt, Tunisia and Turkey re-entered the tourism scene. The question now is which countries are going to be most affected by the recovery of these destinations and to what extent.

To answer this question and understand the dynamics of the competition in the Mediterranean basin, we carried out a simple exercise that examined the correlation between the changes in market share of international tourism for the region's different countries3 . The aim was to understand which competitors lose demand when a given country gains market share in the Mediterranean.

Having analysed the competition in the Mediterranean and, more specifically, having identified Turkey and Egypt as Spain's main rivals, it is useful to look at the growth dynamics of these rivals and how this has affected Spain's capacity for growth.

In the first decade of the 21st century, there was a boom in the tourism industries of Turkey and Egypt, going from 9.0% of the Mediterranean's inbound tourism in 1999 to 23.1% in 2010. As can be seen in the following chart, according to our estimates the high growth these countries experienced diverted about 8.3 million tourists who would have otherwise come to the Spanish market4 . On the other hand, the deterioration in Turkey and Egypt's competitiveness between 2011 and 2016 contributed to Spain's extraordinary growth of 7.8 million international tourists. Finally, our estimates suggest that these tailwinds dissipated in 2017 and 2018, and competition with both countries once again reduced Spain's growth in terms of inbound tourism (diverting 3.5 million tourists).

Although Turkey and Egypt are Spain's two biggest rivals, they are not the only ones. An analysis of the outlook for other competitors such as Tunisia, Morocco and Israel may also provide some useful information. According to the WTTC, international tourism growth forecasts point to vigorous growth in these three markets in 2019, as can be seen in the previous chart. Spain can therefore expect its competition to get tougher, both due to the recovery in its biggest rivals and also the growth in the rest of its smaller competitors in the market. This will limit the growth capacity of Spain's tourism in volume terms. Consequently, given the strong growth experienced by the Mediterranean region, supported by its emerging markets, Spain's tourism industry will attract a smaller share of these flows of new tourists arriving to the Mediterranean basin in the coming years.

In conclusion, the new competitive environment in which the Mediterranean basin finds itself will affect the growth of Spanish tourism in the future. Nevertheless, the growth capacity of Spain's industry is not in question as the pillars on which its leading position has been built are still very solid. It should be noted that Spain continues to be the most competitive tourist destination in the world, at some distance from its rivals in the Mediterranean5 . Given this situation, focusing on growth through higher quality tourism is one of the keys that can ensure good long-term health for the sector, something the Spanish tourism industry itself has been pointing out for several years.