MALLORCA, Spain (Reuters) – German tourists flocking to the sunny shores of Mallorca for Easter are a boon for a few local businesses, but closed hotels and restaurants across the island are a reminder that Spain’s tourism sector is still years away from full recovery.
The beer is flowing and holidaymakers are basking in the sun in Mallorca seaside bars popular with Germans, days after Berlin lifted coronavirus quarantine requirements for returning travellers.
But the tens of thousands who have hopped on last-minute flights are a fraction of the nearly 1.4 million foreign tourists, about half of them from Germany, that came to the archipelago in March and April last year.
“It’s really sad for the people who work here that the Germans can’t come here like they usually would,” said Birgit Sorensen, a psychologist who lives between Mallorca and Germany.
Foreign tourism to Spain plunged 80% last year to 19 million visitors – its lowest in half a century – as global pandemic restrictions dramatically curtailed international travel.
Projections for the pace of the recovery vary, but a summer boom is off the cards and few contemplate a return to pre-pandemic levels before 2023.
Germany still advises against travelling and Britons, usually the second biggest group of foreign tourists on Mallorca, are not allowed to holiday abroad, leaving the resort of Magaluf favoured by rowdy British tourists, deserted.
Maria, 29, depends on German tourists to keep her small beachside shop running.
“If they don’t come we don’t have any income because residents don’t buy from us,” she said, wiping down snacks and trinkets outside the storefront in a neighbourhood locally known as “Little Germany”.
With three workers furloughed, she hopes this summer will be an improvement on last but does not expect a major rebound.
“Even if we’re all vaccinated, there won’t be a recovery. I don’t see it,” she said.
TOURISM’S IMPORTANCE WANES
In its central scenario, the central bank sees arrivals of foreign tourists in Spain reaching around 60% of 2019 levels this year, compared with 20% last year.
But Maria Jesus Fernandez, an economist with the Funcas think-tank, labelled those estimates optimistic and warned that 2021 could be even worse than 2020.
Though demand should begin to recover in the third quarter and gather steam towards the end of the year, that improvement will not compensate for sharply lower arrivals in the first quarter, she said.
Official data are not yet available, but Fernandez calculates that tourism’s contribution to gross domestic product tumbled to 4-4.5% last year from 12% in 2019, a collapse that could reshape Spain’s economy.
“Even if we recover pre-crisis GDP in 2023, it will have a totally different composition than before … with the worst-hit sectors contributing less,” she said.
Spurred on by EU-funded investment programs, construction and heavy industry are likely to assume greater prominence as tourism and leisure retreat.
With COVID-19 infection levels rising across Europe, analysts and business owners agreed that any recovery hinged on a successful vaccination campaign.
“I want to be optimistic but one thing is clear: if the vaccine doesn’t work, there won’t be a summer,” said Antonio Catalan, founder and director of Marriott’s AC hotel brand.
“What’s worrying is that the rise and fall in infections is so unpredictable,” said the industry veteran. “We don’t know where they’re going to appear.”
Catalan is keeping several of his hotels open with most of the staff supported by Spain’s ERTE government furlough scheme, which in February was supporting around 60% of all hotel workers.
Among the holidaymakers in Mallorca, some took a more optimistic view.
“They say that Mallorca is the 17th German state, I think that the Germans will come back,” said 26-year-old Berlin resident Jeroen Maier.
“Of course they need to have permission, they need to have their PCR tests … but I think if people stick to the distancing then people can enjoy it.”
(Reporting by Marco Trujillo in Mallorca and Belén Carreño and Nathan Allen in Madrid; Additional reporting by Tanya Wood in Berlin; Writing by Nathan Allen and Ingrid Melander; Editing by Mike Collett-White)
