European tourism demand remained in positive territory, albeit with a slower expansion rate compared to the past two years, according to the European Travel Commission’s (ETC) report “European Tourism – Trends & Prospects” for Q3 2019.

Although external risks were failing to dissipate, destinations continued to grow at a modest pace and the overarching regional outlook remained positive (3-4% in international tourist arrivals in 2019). Of particular interest in Q3 was that Montenegro maintained growth momentum at 18% as it welcomed a soaring influx of Western European holidaymakers, while the depreciation of the lira continued to play a vital role in Turkey’s tourism performance with an equally impressive 15% increase in tourist arrivals.

According to ETC, while things appear stable in the European tourism sector amid external challenges, uncertainties and the poor shape of the global economy, the greatest risk lies in not seizing the opportunities at hand by encouraging more sustainable and inclusive tourism approaches.

“This latest report highlights that travel demand in Europe is in a good place, with steady increases in tourism numbers across the board,” said Eduardo Santander, ETC Executive Director. “Despite very real challenges, such as the looming threat of a ‘no deal’ Brexit, and the collapse of several airlines, European destinations continue to post healthy rates of arrivals, which of course is to be welcomed. Meanwhile, European tourism needs to focus on developing long-term sustainable management solutions to enable tourism to flourish, rather than just merely grow.”

American and Chinese tourists continue to flock to Europe While intra-regional demand plays a key role in increasing tourist numbers in Europe, large long-haul source markets continue to make a significant contribution, particularly from the US with the dollar up against many other currencies.

Air passenger growth slowing in Europe

Reflecting a general slowdown in the global economy, the report notes that average increase in global revenue passenger kilometres (RPKs), which is an indicator of airline demand, was 4.1 % y/y in Q3, well below the average rate of expansion over the past 10 years of 6.1%.

“No Deal” Brexit likely to have permanent effect on UK travel volumes

According to the ETC report, the combined effect of the economic and non-economic factors associated with a “no deal” Brexit would cause a 7% drop in UK outbound trips in 2020 and an 8% drop in 2021, relative to baseline projections. More significantly, the report states that a no deal Brexit would have a permanent downward effect on UK outbound travel volumes, which is sure to cause concern amongst many destinations across Europe. Spain is likely to be the most heavily impacted per traveller volumes with an estimated 1.3 million fewer UK arrivals to the country in 2021 relative to baseline projects, and Ireland the most impacted in percentage terms (-5%) in 2021.