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Trouble in Paradise - The Algarve

Friday, October 31, 2008

The Algarve has long been a popular tourist destination, but recently holidaymakers have looked elsewhere for their fun in the sun.

One of Portugal's favourite hotspot, the Algarve has historically been hugely popular with holidaymakers from around Europe, but recent statistical reports from the Algarve Hotel and Tourism Businesses Association (AHETA), show a decline in hotel occupancy in 2008.

AHETA's figures compared hotel occupancy in August this year to the same period in 2007.  The overall average occupancy rate was 91.1 per cent this August compared to 94.8 per cent in 2007, a drop of more than three per cent.

There has been a noticeable decrease in the amount of visitors from the UK, who make up 37 per cent of the Algarve's summer trade.

Many associate the decline with the global concerns over the credit crunch, with less people deciding or being able to afford to take a summer holiday this year.

The absence of visitors to the area, especially from Britain, could have serious repercussions on the Portuguese economy, which relies heavily on its tourism trade.

The drop in tourists has affected other economic areas with many of the region's restaurants, bars and nightclubs' profit margins suffering.

Many UK holidaymakers are being tempted to more affordable locations such as Egypt, Turkey and some parts of the Caribbean. AHETA believe this is partly due to the poor performance of the pound and also to the fact that there is increasing opportunity to buy property in these areas of the world that promise the potential of a far greater rental return and capital growth.

in response to the recent figures, Turismo de Portugal have remained positive, stating that final figures produced by the Instituto Nacional de Estatistica (National Institute for Statistics) are yet to be published but already the number of tourists and overnight stays in the Algarve are better than in 2006.

AHETA President, Eliderico Viegas, indicated that last year was "exceptionally good" for tourism in the Algarve and that this year's figures have simply realigned with those of 2006.

He stated that on average, the number of tourists in the region has not dropped but the time they had spent in the Algarve had reduced from an average of seven days in 2007 to an average of 5.6 days in 2008.

He suggested, in line with the Portuguese Government and Turisom de Portugal's strategic planning, that there should be a greater commitment to hotel modernisation and that people and organisations should be more enterprising to encourage tourism.

Whilst the Algarve has the natural resources to remain a major tourist attraction, the region needs to continue promoting and refining itself as a cosmopolitan destination that offers visitors diverse experiences.

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