Madrid Funding to The Rescue Of Spanish Tourism |
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By: Go Cielo Posted: 2009-03-12 07:45:38 |
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The Spanish government gave €400 million, roughly the equivalent of $500 million, to the Spanish tourism industry in an effort to save the sector from going into total decline. Revenues from tourism in the Iberian country dropped 12% in 2008 due to global recession.
The government aid is meant to fund efforts to modernize the Spanish tourism industry and make the country more attractive once again in the face of growing competition from other European countries. The funding is more geared towards helping small and medium enterprises in the Spanish tourism sector survive the economic downturn. Revenues from Spanish tourism went down by 12%, according to reports posted in November 2008. The decline is mostly felt in the more popular destinations such as Catalonia, the Canary Islands and the Balearic Islands. Leading hotel and hospitality chains like Sol Melia and NH have posted profit losses of about 41% and 20% respectively due to the declining tourism in the country. The decline in the Spanish tourism industry is seen as a sign of the economic recession that has been affecting the entire world. Tourists flying into Spain have gone down to 54.6 million in 2008, 2% lower than the number of tourists who have visited the country in 2007. The bulk of these tourists come from Britain and Germany, two countries that are also experiencing an economic downturn. The number of British tourists to Spain went down to 15%. German visitors, on the other hand, are less by 7% in 2008. British tourists are opting to stay at home or visit cheaper destinations because of the weak performance of the pound sterling against the euro. Currently, Spain is competing for tourism revenue against cheaper and less crowded destinations such as Egypt, Turkey and Croatia. More and more tourist operators in Great Britain and elsewhere in Europe have begun to offer less expensive vacation packages to such destinations. Domestic tourists in Spain have also begun to spend less on travel expenses as an effect of the economic crunch. Though the Spaniards have not yet opted to give up on traveling during the summer months, they now go to cheaper destinations and spend less on those trips. Tourism makes up 15% of Spain's gross national product, creating one out of ten jobs in the country. It is the second largest industry in Spain, next to construction and real estate. The year 2008 is the first time in almost 50 years that Spain has seen negative figures in its tourism industry. Construction and real estate in Spain have also begun to slide because of the decreasing number of tourists coming to the country. Expatriates are no longer as quick into buying or leasing vacation homes in Spain as in previous years. Unemployment in the construction and real estate sector has gone up to 2.5 million, the largest jump in unemployment in Spain in the last ten years. In the light of the economic crunch affecting the entire world, many small- and medium-scale operators in the Spanish tourism industry have started to offer less expensive vacation packages. One travel operator that offers such packages is Cielo. Calle Cristofòr Colom 4-6, Edificio Colom 3º-4ª 43001 Tarragona. Tel: (+34) 977 22 81 81 Fax: (+34) 977 21 52 99 |
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