We all know: Tourism, one of the main sectors of the world economy, is experiencing the biggest crisis ever. The declines in 2020 – around one billion international tourist arrivals (-73%) and 900 billion euros in foreign revenues (-65%) – reflect their size well.
Portugal, which occupies a good position in the world ranking, (15th place in tourists and 20th in revenue), suffered in 2020 losses in the same proportion, which was reflected in the Algarve, which is the main tourist destination in the country. This is the new starting point for Tourism.
There are many conjectures, not always innocent, that circulate about the future of Tourism, generating some perplexity and concern. Tourism protagonists cannot be mere spectators, they must intelligently reflect on the new scenario they will have to face.
Let's look at the Algarve, based on the importance of Tourism in the economy of the region and the country, in a context of containment of the pandemic and with visible signs of recovery. Let's start with some mistakes that can make this reflection difficult.
For example, there are those who, in a naive way, claim that «the worst is over», that Tourism is already moving, and that soon «everything will be what it used to be». That is, nothing will change. Just wait. It is a dangerous opinion that can generate illusions and lead to inaction. There are still many signs of uncertainty.
Others claim that tourism not only “will change”, but even “it will never be what it used to be”. It is also a dangerous opinion, which can generate, in addition to distrust, also inaction.
The reality is much more complex and requires a serious approach.
The truth is that, while tourism will not go back to what it used to be, it will not change radically either. It will, yes, have new elements.
Tourism has its roots in fundamental structural factors, which have been confirmed at different stages worldwide over many decades, and which will continue.
The main and most important is its direct relationship with the evolution of the economy, with the growth of tourism being associated with the strengthening of the purchasing power of citizens and its social and cultural evolution. It won't change.
History has shown that when an economic crisis arises with a drop in consumption, tourism stagnates and often falls. In the World, in Europe, in Portugal, in the Algarve. Last example: the consequences on Tourism of the global economic crisis generated by the pandemic.
But we must also associate other important conditioning factors.
First, political security and social peace in tourist destinations. And also health security, which was already important, but which, with the lessons of the pandemic, became a major factor.
Another essential link between demand and supply is Transport, especially by air, and infrastructure cannot be relocated (airports, ports, etc.).
In addition to other areas of a different nature, such as the tourist offer (hotels, restaurants, sporting and cultural activities, etc.).
The importance of all these vectors will remain. These are basic factors that affect the emission of tourists and the availability of receiving markets.
There is no Tourism without economic progress and political and health security. And no transport. As there is no Tourism without the existence of attractive, innovative and competitive offers in the destinations. As there is no Tourism without tourists and tourist demand will continue to determine the tourist market.
These fundamental structuring factors, permanently renewed and enriched, will continue to be an essential condition for the existence and dynamics of Tourism. In essence, they will not change.
And when we reflect on the dynamics of recovery and evolution of Tourism in the Algarve (and in the country) they must be taken into account.
What will change:
There is a set of emerging factors and new trends that are already evident and cannot be ignored, which will have a very strong impact on the Tourism universe and on the attitude of Tourists. Whether in the holiday and leisure sector or in other specific sectors of different dimensions.
Let's look at some. From the outset, changes in tourism distribution, increasingly online as a result of new technologies and digitization in the universe of Tourism, generating new situations and experiences, and requiring rapid responses from different operators.
Tourism distribution increasingly depends on direct online negotiation with a more demanding demand, in all sectors and segments, not only in accommodation, but in services and associated products. Everything faster, more direct and more competitive.
It is a framework in permanent evolution that forces companies to adapt structures and skills, to recreate and innovate offers, in order to respond to new demands, in a context of greater competition. The Algarve cannot fail to be present in this challenge.
At the same time, Tourism, in all its vectors, will have to face complex challenges and new global trends with a great impact on the entire economy, particularly in this sector.
Much is said today about "sustainable development", already officially assumed by governments, and it is clear that Tourism, by its nature, must be an integral part of this new dynamic: climate change, renewable energies, decarbonisation, water resources, the preservation of biodiversity and the environment.
It is not easy and it is not enough to put them in political programs.
Tourism has a real interest in this issue and must intervene through the creation of new products that respond to the sensitivities of demand and that represent an enrichment of offers in a context of change.
More experienced tourists can find them an attraction for new experiences. The younger ones will be faced with innovative challenges and exciting experiences.
Something will change for everyone, albeit in a different form and measure. The Algarve, if it wants to be competitive, has to take over and participate in this battle. Portugal too. The Algarve will have to face very strong challenges in Tourism in the near future. Portugal too.
Companies have to prepare for them. It is not enough to make big proclamations. Nor do you live off the «numbers of the month» compared to the previous year's counterparts.
It is necessary to define a specific program of practical action for the resuscitation of Tourism with concrete measures to recover and return to growth, which requires, above all, to provide the different sectors with realistic information and knowledge of what is changing and what can be enriched with new proposals that correspond to the new sensibilities, the new interests of the different segments, the new generation of Tourists and changes in the market.
Being aware of what has changed and has not changed and what is changing. Entrepreneurs, associations, professionals and institutions in the Algarve must take part in this challenge. Knowing that Portugal has different characteristics in relation to other countries in Europe and that the Algarve too, in relation to other regions of the country.
Author Vítor Neto is president of NERA – Business Association of the Algarve Region
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