Tourism is, on the whole, an underappreciated industry. Tourists are more or less tolerated by the inhabitants of the cities and countries that they visit, but they really are a necessary part of today’s society. Tourism “brings social inclusion and understanding in a way no other industry does” (Gollan). Not only is this important for the diversity of Europe, but it is also fantastic for the economy. Those who had been turned away for not having the right education and training in other fields can find work in this labor-based industry as long as they can work with a smile. It is especially interesting to look at how the European Union encourages tourism, and how being a part of the Union could help or hurt a country.
So which EU country gets the most tourists? According to Eurostat’s 2014 research, Spain was the clear victor, being the destination of 20.7% of trips, and claiming the top spot for total number of nights visitors spent there. France and Italy come up in the rating right after Spain, at 12.4% and 12.0% of trips respectively, followed by Germany, Greece, and the United Kingdom (“Tourism Statistics”).
However, being the victor in total number of visitors does not make Spain the victor in terms of money actually accumulated from these tourists. Whether it be the differences in prices, total cost of living in that country for a few days, or how many street vendors line up outside famous tourist attractions, not all countries will get the same amount out of tourists as the next. This is important, as money is quite literally being taken from one country to another. So which country makes the most off tourism?
Although you may think that it would be France or the UK, these two actually come third and second to Germany. One of the biggest draws of Germany right now is that it is seen as stable and safe (“Why More Tourists Are Flocking to Germany”). With the state of the world today, the last thing tourists want to worry about is crime and the safety of their family. And as Germany is seen as well-regulated and protected, it only makes sense. Its overall wealth also invites business trips to Germany, which just adds to its appeal. According to the World Travel & Tourism Council, it is estimated that Germany made US $376.7 billion off of tourism and travel-related expenditures in 2016. This includes everything from costs of renting hotels, transportation costs, and tourism services, to food and drink, investments, and jobs created to keep up the industry. The amount of money Germany earns this way is gigantic, and accounts for 9.7% of Germany’s overall GDP, which is US $3,874.4 billion. Surprisingly, tourism accounts for 9.6% of the United Kingdom’s total GDP as well, with a total contribution of US $283.2 billion.
If Germany and the UK rely on tourism for almost 10% of their GDP, which countries in the EU rely on tourism the most? These countries are usually quite small, known exclusively for their beaches and beautiful weather. In the EU, the most notable ones are Cyprus, Croatia, and Malta. Croatia boasts the b
iggest GDP of the three of them, at US $57 billion, 22% of that being a product of tourism. Malta depends on tourism the most, however, having a GDP of US $10.5 billion, 25.8% of which is brought in from tourism (“Country Reports”).
So what would happen to a country that relies on tourism leaves the Union? Brexit is a good example of this, as “UK tourism accounts for one-eleventh of our GDP and provides more than three million jobs” (Calder). Ever since the referendum vote, the sterling has not been what it used to be. Assuming the UK’s currency will stay low, this could potentially mean good things for the tourism industry, at least in theory. Tourists would get more pounds for their euros, encouraging them to visit the UK instead of a country that uses the euro, for example (Calder). And those that live in the UK may stay in the UK for vacations instead of going abroad. However, this type of thing is price-inelastic. Just because it’s 25% more expensive doesn’t mean that 25% less people will go.
What’s easier to predict is how a lower mobility of people would affect businesses. This would make it harder to hire people from other countries, inevitably giving more jobs to Brits at a higher wage (Calder). With less competition, workers can demand more pay, which is nice for workers in a low-paid industry, but it also punches up the price of products. If there are less foreign workers, that also means a lower need for business-class flights, which are the main source of income to fund flights, not the cheap tickets tourists usually buy. Cutting back on flights may start to be necessary somewhere down the line, meaning a raise in ticket prices in general, including for tourists.
The last big thing to consider with this is how tourist sentiments to the UK will change after Brexit. Being a part of the European Union definitely gives the UK an air of stability. But with the plan to leave the Union makes Britain seem less inviting and maybe even less appealing to tourists. In a study done by Travelzoo before the referendum, nearly 6,000 people were surveyed from France, Spain Germany, the US, Canada, and Italy. Roughly a third of the Europeans and one tenth of the North Americans said they “would be less likely to come to a post-Brexit Britain” (Calder). Researches from Bournemouth University calculate this kind of drop in overseas tourists would “cost the UK £4.1bn, forfeiting more than a billion a year in tax revenue and shedding 63,000 jobs” (Calder). The long-term effects of the vote on tourism is still yet to be seen, as the pound continues to stutter in value and people come to terms what this could mean for the future of the EU.