Outlook on Tourism in the Algarve

A brief analysis of what was experienced in 2018 and what is expected for Algarve tourism in 2019.

Decrease in occupancy rates in the Algarve in 2018

The first few months of last year were driven by a decrease in occupancy rates in the Algarve, compared to 9.7% in 2017 of (data from AHETA in April). The highest decline was in the UK market (20.5%), which cannot be dissociated from the uncertainty of Brexit; followed by the Dutch (14.6%) and German (11.9%) markets, due to the very strong marketing campaigns of competing destinations such as Tunisia, Egypt and Turkey; finally, the national (10.3%) and Spanish markets (43.1%) suffered a reduction due to the bad weather that was experienced at Easter. According to INE data, in 2018 the number of overnight stays decreased by 0.2%, as well as a slight decrease in the percentage of foreign guests, according to Eurostat.

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Algarve tourist occupancy rates ended the year positively

In November, however, there was a satisfactory rise in the number of guests, compared to the previous month (October) by 5.7%, as well as an increase in the number of overnight stays in the Algarve by 6.6% (data from the National Statistics Institute - INE). The Algarve ended the year with a 2.2% increase in the number of overnight stays of non-residents, which was contributed by the UK (+ 15.3%) and Spanish (+ 21.4%) markets. "The cherry on top of this cake was the impressive growth of British tourists in the region, more than 15% in November," says João Fernandes, president of the Algarve Tourism Association (ATA).

2019 - Year of challenges and consolidation of the tourism industry in the Algarve

Anticipating the impact of the re-emergence of competing destinations and Brexit, 2019 will be a challenging year for tourism in the Algarve. One of the strategies that the Algarve Tourism Association (ATA) is launching is the promotion of the region to a high-end market that appreciates sustainable and differentiating tourism, and is less sensitive to the price factor. "We believe that the main consequences of these phenomena will be truly reflected in 2020, so this year we will focus on finding solutions and alternatives that contribute to the sustainable development of Algarve tourism," says the ATA president.

The Algarve is a region that excels in cultural and gastronomic diversity. The goal is to position the destination to a level of quality capable of offering the tourist an authentic and more emotional experience. Leveraging this strategy, golf continues to be a good contributor to other rising markets that visit us outside of high season, reducing the region's seasonality - Swedes, Danes, Brazilians, Americans and Canadians. These last three markets are curious about "gastronomy, culture and nature tourism", describes João Fernandes.

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In this sense, the Algarve has taken the first steps to increasingly become a gastronomic destination, to capture culinary and ecological tourism, that is, to direct the kind of tourist who seeks memorable gastronomic experiences to the region.

Casas do Barlavento considers a smart strategy to mitigate the possible decreasing trend in tourism in the coming years in the Algarve region.