Andrew J. Wein - May 17, 2023
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To truly understand the development of the Spanish economy, it is imperative to consider the impact of tourism. In 2022, with 75.6 million foreign visitors, Spain became the second-world tourist destination, behind France and tied with the United States. It is a position the country has maintained for years. About 10% of the Spanish economy and more than 11% of employment depend on tourism. According to EXCELTUR, tourism has contributed to 61% of economic growth in 2022. The tourism growth rate is expected to remain steady this year, with a 40% increase compared to last year. The country still needs to catch up to the record number of tourists in 2019, with 83.7 million. However, if the current trend continues, and despite the price crisis and the increase in transport costs, it is possible that throughout 2023 that figure will be exceeded.

In the past, there was concern that tourism growth in North Africa or the Adriatic could slow down Spain's tourism industry. However, due to instability in those regions and Spain's competitive advantages, Spain's tourism industry has continued to thrive. In 2008, 53 million people visited Spain; now, fifteen years later, that number has increased to around 80 million. Spain maintains its competitiveness thanks to a very consolidated, innovative, and dynamic tourism industry, with good transport infrastructures and a successful international promotion strategy, based on cooperation between the public and private sectors, which has consolidated the sector as one of the most important factors in the economic growth of Spain. Spain has an exceptional reputation as a tourist destination that has been maintained for many years. This is not only a reason for pride but also adds value to the country's brand.

However, despite the positive results of the Spanish tourism sector, there are also some dark spots and improvements that need to be addressed. Tourism activity is concentrated in three autonomous communities (Catalonia, the Canary Islands, and the Balearic Islands), which account for more than 60% of tourists.

Unfortunately, Spain has not successfully transitioned from sun and beach tourism to other more diverse and lucrative models, such as congress or cultural tourism. These models, although they have potential, still need to be widely adopted.

Unfortunately, many jobs continue to offer low wages. Additionally, the increase in tourism in certain areas is causing displacement of the local population and negatively impacting the traditional economy. This is especially concerning in the neighborhoods of Barcelona and Madrid and towns along the coast. The depletion of natural resources, particularly water, is a major issue that will significantly impact this year due to the severe drought we are currently facing.

These weaknesses point to the limits of the Spanish tourism model. When relying on tourism growth for economic development, industry stakeholders need to prioritize a sustainable model that ensures long-term economic, social, and environmental stability. Unfortunately, this is not currently the case. With the sector's support, the Ministry of Industry is working on a tourism sustainability strategy. However, there are other factors to be taken into account. In the future, climate change could affect the appeal of certain tourist locations due to limited resources and increased demand. Furthermore, efforts to reduce air travel may cause prices to rise in currently affordable destinations, potentially harming areas that rely on budget tourism. In some areas, the tourism industry is becoming less socially acceptable. The country needs to develop sustainable models that support growth without negative consequences.

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