The challenge of growing sustainably

Spain’s tourism sector has kicked off 2024 with excellent figures in terms of visitor arrivals, spending and activity. This is the best start to a year since records on these indicators began. In addition, this buoyancy is occurring in the wake of 2023, which already saw records in the sector broken. In the first quarter of 2024, 24 million foreign tourists arrived in our country, some 3 million more than in the same period of 2023. Moreover, spending by international tourists grew by 22.6% year-on-year, making a significant positive contribution to the Spanish economy’s foreign balance.

These excellent figures reflect the strength and competitiveness of Spain’s tourism sector, which we should recall ranks second among all tourist destination according to the ranking produced by the World Economic Forum, behind only the US and ahead of the likes of Japan and France. All the indicators suggest that this positive trend will continue in 2024 and 2025. Here at CaixaBank Research, we forecast that tourism GDP will grow by around 5% in 2024 (twice the rate expected for the economy as a whole) and by 3.2% in 2025. This rapid expected growth is thanks to the recovery of European households’ purchasing power in a context of falling inflation, the recovery of the European economy and the perception of greater security offered by our country in a context of high geopolitical instability in the eastern Mediterranean.

This forecast reflects a slight slowdown in the sector in the coming quarters compared to the rapid growth of the first quarter, given the presence of certain factors that will tend to moderate the rate of progress, such as the gradual recovery of other competing destinations, the impact of the Olympics in Paris this summer and our expectation that domestic tourism will experience weaker growth due to the increase in foreign travel by residents in Spain.

The exceptional recovery of tourism in the aftermath of the pandemic has also highlighted the need to continue improving the management of tourism flows in order to minimise the negative impacts they can generate, including on the local housing market, pressure on basic public services and the occupation of public spaces, among others. It is desirable that both the government and the industry itself continue to work to ensure that the sector’s growth can be sustainable, both socially and environmentally.

In the second article of this report, we continue to investigate the effects that the heat waves of the last two summers have had on international tourism in Spain. This is a highly innovative analysis produced using data on payments made with foreign cards on CaixaBank POS terminals and climate data from Copernicus. The main conclusion of the analysis is that tourists who suffered a heat wave in the summer of 2022 were less likely to return to Spain the following summer. In particular, exposure to extreme heat waves (more than 8 degrees Celsius above the historical average) results in a reduced propensity to return, especially among the British and Americans. This result highlights the importance of promoting innovation and investment in infrastructure in order to guarantee tourists’ comfort in more extreme climate scenarios.

In the third article, we analyse the pattern of spending by international tourists, broken down by place of origin, based on indicators from the CaixaBank Research Real-time Economics portal. This analysis reveals that European tourism is still the most important, although it has lost some of its share compared to 2019, and that tourism from the American continent has grown the most. In contrast, Asian and Eastern European tourism has seen its share of international tourism demand decline.

In the last article, we present a snapshot of the catering sector in Spain. This sector is currently enjoying a boom in terms of employment and turnover, largely thanks to the full recovery of the tourism sector. Despite having a high percentage of very small companies with low levels of productivity and turnover, the sector has significant strengths which must be acknowledged, such as its international recognition and prestige and its important cohesive role in society due to its presence in practically all Spanish municipalities.