Irish tourism is returning to pre-pandemic 70 per cent levels, but the sector group warns of ‘economic headwinds’.

Ireland’s tourism sector has seen a strong recovery after most Covid-19 restrictions ended earlier this year, with seven million international tourists traveling to the country in 2022.

The Irish Tourism Industry Association (ITIC) has released its year-end data and said the sector has recovered 73 per cent compared to its pre-pandemic peak in 2019.

Of the seven million travelers this year, ITIC estimates that 2.6 million came from mainland Europe, down 28 percent from 2019, 2.4 million came from the UK (-30 percent), 1.5 million came from North America (- 22 percent), while 0.46 million came from the long-haul markets (-32pc).

The Tourism Authority said with the easing of travel restrictions since March, the speed and strength of the recovery in travel to Ireland “has exceeded expectations and the surge in demand has exceeded most industry forecasts”.

Looking ahead, ITIC “welcomed the increase in air access” to Ireland but also expressed “significant concern” that further recovery would be threatened by “rising cost inflation, the energy crisis and the impact of government contracts with tourism accommodation providers”.

Estimates for next year range from a “collapse in this year’s output to single-digit growth.”

The ITIC estimates that a full recovery of tourism to 2019 levels is unlikely to be achieved before 2026, citing “global economic headwinds coupled with cost inflation and domestic supply constraints”.

Elaina Fitzgerald Kane, Chair of ITIC, said: “Fortunately, 2022 was a stronger year than expected, with pent-up demand, deferred bookings and accumulated savings all boosting business this year. It is vital that the sector returns to sustainable growth.”

“We certainly hope that we can continue the momentum and recovery into next year, but the government must enable tourism to thrive by extending the 9 percent VAT rate and easing supply shortages.”

The ITIC has also raised concerns about accommodation restrictions due to the refugee crisis.

ITIC chief executive Eoghan O’Mara Walsh said the supply of tourist accommodation will be “seriously reduced” next year and this will impact the overall recovery of the tourism economy.

“We now estimate that at least 28 per cent of all tourism beds in regional Ireland are unavailable to the tourism industry due to government contracts. “While hotels and guesthouses are part of the solution to housing refugees, they cannot be the only solution. If this level of tourist accommodation is not available to international visitors over the next year, it could cost the broader tourism industry up to €1 billion in lost revenue,” he said.

The ITIC said other businesses such as shops, attractions, pubs, restaurants and cultural experiences will be particularly hard hit, with data from Fáilte Ireland showing that for every euro a tourist spends on accommodation, they spend EUR 2.50 on ancillary tourist services be issued.

The ITIC called for the government to adopt a “balanced two-year humanitarian plan” to accommodate refugees and asylum seekers, including the use of “vacant buildings, state facilities, unused housing and modular housing, and tourist accommodation”.

“If there are no tourist beds in tourism towns next summer, there will be no tourism activity and that will have a very negative impact on the local economy,” Mr O’Mara Walsh added. Irish tourism is returning to pre-pandemic 70 per cent levels, but the sector group warns of ‘economic headwinds’.

Fry Electronics Team

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