In an analysis note on the tourism sector in Portugal, the financial rating agency DBRS Morningstar anticipates “another difficult year” for the activity, due to the seriousness of the global pandemic crisis, the delay in the vaccines in Europe and the prolongation of travel restrictions.
“Given the importance of the tourism sector to Portugal, this will probably delay the country’s full economic recovery”, the report considers.
Even so, DBRS maintains that “the shock of the Covid-19 will be temporary and should not result in structural changes in the Portuguese tourism sector.
“Although this crisis will inevitably have serious consequences for many workers and companies, particularly those most exposed to this specific activity, tourism demand in Portugal is expected to return to pre-pandemic levels”, reads the analysis note.
According to the agency, “the characteristics that, before the crisis, made Portugal attractive to visitors globally will remain for a long time after the pandemic”.
In its analysis of the Portuguese tourism sector, DBRS recalls that, between 2010 and 2012, Portugal received an average of 14 million non-residents per year, with this number reaching 27 million people in 2019.
This almost doubling of tourist arrivals in less than a decade has allowed the tourist accommodation sector’s revenues to almost triple, so that, at the end of the decade, tourism and related industries accounted for 17 percent of the Gross Domestic Product (GDP), 19 percent of employment and 20 percent of total exports.
In 2020, impacted by the pandemic, Portugal registered 10.6 million tourists and, although domestic tourism allowed some recovery in the summer months, the lack of foreign visitors contributed significantly to the 7.6 percent economic contraction registered that year.