April 16, 2014 7:09 pm

Spain welcomes mass return of tourist euros

Guadalest Mountain Top Village and Castle Alicante Province Costa Blanca Southern Spain Espana Europe EU©Alamy

High hopes: Guadalest mountain village is a popular attraction on the Costa Blanca

For the first time since Spain fell into prolonged recession in 2008, the Eden Mar hotel in the southeast beach resort of Guardamar del Segura is fully booked for the Easter weekend and expanding its staff.

The business has hired extra workers to cope with the hordes of people landing at nearby Alicante airport for holidays on the Costa Blanca.

“Medium-term bookings are up 30-40 per cent from last year and, what’s more, people are now booking in advance,” said Maria Teresa Gomez, the hotel manager.

“In the crisis years, they would leave it to the last minute.”

With six employees and 37 rooms, the Eden Mar is a good example of the micro-businesses that provide 30 per cent of all jobs in Spain. The hotel’s decision to hire another four people is the kind of welcome relief needed in a country where unemployment remains stuck above 25 per cent.

Candelaria Rivero, who has worked as a tour guide in Tenerife for about 30 years, said the Easter rush would also be a shot in the arm for hotels in the Canary Islands that have had to scrape by during the financial crisis, offering budget rates to pensioners.

“Tourism is practically all that people have to live on here. If it weren’t for the seniors, most hotels would have closed by now and put people on the dole,” she said.

Tourist arrivals in Spain in 2013

Easter bookings across Spain have boosted confidence in the hotel industry. Spain received a record 60m tourists in 2013, and the National Tourism Institute predicts strong growth in the second quarter of this year. The Bank of Spain expects this upturn to continue at least until next year.

The recovery in Britain, Germany and the Scandinavian countries – where most visitors to Spain traditionally come from – has fuelled the tourism boom, which has also been helped by holidaymakers shunning traditional competitors such as Egypt because of political turmoil.

Visitors’ spending is also going up. In the first two months of 2014, foreign tourists spent a record €6.1bn – 9.1 per cent more than in the same period last year.

The more the global economy grows and the more people start breaking away from survival incomes, the more tourists you get

- Prof Javier Díaz-Giménez, IESE Business School

As tourism accounts for more than 10 per cent of Spain’s national output and employs 11 per cent of Spanish workers, the sector’s recovery is helping to drive the nation’s economic upturn.

“[Tourism] is a great export machine for Spain,” said Javier Díaz-Giménez, professor of economics at the IESE Business School in Madrid. “It’s great at creating jobs because it’s labour-intensive and the margins are great.”

However, Prof Díaz-Giménez said Spain should make a greater effort to attract more visitors from emerging markets, whose contribution to local tourism was still negligible.

“The more the global economy grows and the more people start breaking away from survival incomes, the more tourists you get, and they will head for [European cities such as] Paris and Barcelona,” he pointed out.

The UN World Tourism Organisation forecasts that international tourist arrivals will grow on average by an annual 3.3 per cent in the two decades between 2010 and 2030. But it also expects the share of the mature European market to drop to 41 per cent from 51 per cent, as destinations from the developing world become progressively more popular.

Spanish tourism arrivals and spending

Ramón Estalella, who is secretary-general of the Spanish hoteliers’ association Cehat, says the fact that Spain won back its third spot from China last year in the world rankings of most-visited countries shows the industry is still competitive.

“That was not down to internal devaluation but value for money,” he said.

“Labour and legal costs may be less in north Africa, but [these countries] are less safe, so tourists turn back to countries with more experience.”

One potentially enormous market that Spain is struggling to tap is the US. Despite the American students who keep flocking to the annual bull-running festival in Pamplona, 90 years after the writer Ernest Hemingway first made it famous, Mr Estalella admits that US tourists still seem to prefer Britain, France and Italy when they come to Europe.

“We need to sell Spain as a venue for learning Spanish, and for business travel, but also as a place where they may seek authenticity backed by our thousands of years of tradition,” he said.

“We need a leitmotif , like ‘The Spanish way of life’, because our world view is different to that of others.“

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