Maravillas DelgadoJust as we have been betting these weeks on how many medals Spain will win at the Paris Games, in the tourism sector betting is on whether we will break a record in the number of foreign tourists again. In 2023, Spain received just over 85 million international tourists, which meant surpassing the pre-pandemic record of 83 million tourists in 2019. In fact, there are those who speculate whether 2024 will be the year of 90 million and another unknown is whether Spain will be the overtaker, surpassing France as the leading recipient of international tourism. Will we reach 90 million? It is difficult to make a correct prediction, but there are data that help to get an idea of the direction in which we are moving. According to the latest published data on border movement statistics (FRONTUR) from January to May, Spain received more than 33 million international tourists, which represents a growth of 11.5% compared to the previous year. There are certain countries that stand out for their strong growth: tourists from the United States are growing at a rate of almost 15%. In addition, countries that are very important for the number of tourists we receive, such as Germany, France or Italy, are also growing by more than 10%. The growth in the number of tourists is not the only positive indicator. The spending made by each visitor is higher. From January to May 2024, the daily spending per tourist was 204 euros, with an increase of 8.6% compared to last year. In short, greater volume, in terms of tourists, greater spending and a certain predisposition to spend even when prices rise. For example, in terms of hotel prices, Spanish hotels charge an average of 111.7 euros per room, in the case of five-star hotels, the average price (Average Daily Rate, ADR) reaches 270 euros. The above data have relevant implications. First, tourism is consolidating itself as a very important industry to explain economic growth. In 2023, the growth of tourism-related services accounted for two-thirds of the aggregate growth of the Spanish economy. In general, it is a sector that contributes to the increase in employment. In addition, as the hotel sector data attest, the combination of greater demand and higher prices has allowed a substantial improvement in margins and profits, a detail that is not minor for many companies in the sector that had serious difficulties during the pandemic and that in many cases had to resort to borrowing. What can we expect for this summer? There are different estimates, some of which are from the sector itself, which works by extrapolating data from what has happened so far and the evolution of reservations, as well as estimates from economic and economic analysis institutes. In general, they are all optimistic and predict that the data from the previous year will be exceeded. Although it is changing, tourism is seasonal, and the period of greatest movement, hotel occupancy and higher prices has only just begun. When tourism recovered so strongly after the pandemic, two explanations were given: one, the existence of a savings pool, which has largely already been spent, and the other, the so-called “revenge tourism”, the desire to make up for lost time and what we could not enjoy when there were restrictions on movement. However, that time has passed and the strength of tourism seems intact. There has probably been a change in consumer priorities and in how families decide to spend their money, reducing other expenses, but making well-deserved vacations something essential. The big question is: what is the limit to tourism growth? We see concentrations in some places with strong tourist pressure against mass tourism, decisions such as that of the Barcelona city council to eliminate tourist apartment licenses in the not-so-distant future, and proposals to increase taxes on tourism. The truth is that there are two limits to tourism: one, the one imposed by physical limitations, infrastructure, such as hotel supply, or the capacity of an airport to receive more passengers; and the other, a more complicated limit, which has to do with the point at which the costs associated with mass tourism exceed the benefits it brings, a limit that is not free from controversy and difficult to calculate. However, I would like to draw the readers' attention to a relevant issue: tourism in Spain is becoming less seasonal. The difference in hotel occupancy in large cities – Barcelona, Madrid or Malaga – between the months of highest and lowest demand is smaller than it was. Destinations such as Galicia, which seemed less attractive in winter, have a climate more favourable to tourism for more months of the year. This deseasonalisation helps to increase the number of tourists without reaching the point of saturation of the infrastructure, as it allows the flow of tourism to be distributed more equitably throughout the year. To debate tourism with a position that only extols the benefits it produces in terms of wealth or that stigmatises it due to the impact of mass tourism in certain destinations, in terms of housing prices, the structure of the commercial network or negative effects for residents, is to simplify a more complex issue. Spain has and will have a clear competitive advantage in this industry, which is smart to know how to take advantage of, and which must be regulated. But this regulation is better when all the actors are involved in its design and when it is done from a rational approach and not from a previous ideological position. Speaking of a record summer, I wish all readers a happy and well-deserved rest.Pedro Aznar, Professor of the Department of Economics, Finance and Accounting at Esade. Follow all the information on Economics and Business on Facebook and Xor in our weekly newsletter