European Tourism Regains Lost Ground, Ukraine War Fallout Continues to Impact Markets

Photo source: ETC

European tourism demand entered 2023 on a strong footing despite ongoing challenges, with international tourist arrivals 18 percent below 2019 levels, according to the latest edition of the ‘European Tourism Trends & Prospects’ quarterly report from the European Travel Commission (ETC).

Year-to-date data shows that almost one third of reporting destinations have surpassed 2019 levels of tourist arrivals, while one fourth are 10 percent below.

However, the report highlights that the ongoing war in Ukraine continues to hinder travel recovery in Northern and Eastern European destinations.

Source: ETC

In arrival terms, Serbia (32 percent) and Türkiye (21 percent) outperformed other destinations, mostly due to the influx of Russian travellers taking advantage of the visa-free regime in both countries. In contrast, the absence of Russian travel has been a factor slowing down tourism recovery in some Northern and Eastern European destinations. This has mostly been felt in Finland (-22 percent) and the Baltic states of Estonia (-17 percent), Lithuania (-34 percent) and Latvia (-37 percent).

Source: ETC

Similarly to Türkiye, Bulgaria also saw a strong performance (up by 27 percent), supported by its perception as a good value holiday destination in times of rising travel costs.

“It is encouraging to see healthy levels of recovery as we hurtle towards the summer peak season,” said ETC President Luís Araújo.

However, he added that many challenges still hinder the travel industry, from battling inflation, to dealing with the fallout from the war in Ukraine.

Despite increasing demand, flight volumes have continued to plateau, signalling that supply constraints are still stalling recovery. Data from Eurocontrol indicates that European air traffic remained down 14.4 percent in January 2023 compared to January 2019.

Other challenges from 2022 are expected to spill into 2023 in terms of elevated food and jet fuel prices, as well as higher operating costs for airlines and hospitality establishments.

Source: ETC

According to ETC’s president, the travel industry must also focus on tackling longer term challenges.

“To preserve the sector for future generations, tourism businesses, policymakers, and destinations must strengthen their efforts to encourage responsible tourism practices, minimise negative impacts on the environment and create positive impacts on the wellbeing of our populations,” he said.

The ‘European Tourism Trends & Prospects’ quarterly report by the ETC monitors Europe’s tourism recovery, macroeconomic developments and other major factors having an impact on the European tourism outlook.