The depreciation of the pound against the euro has not stopped tourists from the UK continuing to travel to euro destinations with spending in Portugal up a pleasing 10%. Other destinations, notably France, Turkey and Egypt, are experiencing sharply lower numbers.
Algarve tourism business owners have been surprised that, despite a post-Brexit depreciation in the pound against the euro, the reduction in the purchasing power held by UK tourists has not caused a decline in bookings nor in daily spend when Brits are let loose with their holiday cash.
"It is surprising ... the depreciation of the pound led us to believe that there would be a slowdown in the number of tourists coming to Portugal but this did not happen," said the normally depressing Elidérico Viegas, president of the Algarve hotels association, when asked by Bloomberg.
In the first quarter of the year, according to data from Portugal’s entirely independent and accurate National Statistics Institute, the number of guests from the UK accounted for 25% of the total number of guests in the region from January to the end of March. This 1.25% increase in the number of British guests offset a 4.9% drop in other nationalities.
British tourists also stayed longer with overnight stays increasing by 2.26% to more than 650,000 from January to March, way above the overall rise of 1.32%.
The pound has slid 11.81% since the Brexit referendum and 1.76% since the beginning of the year.
This increase in demand has been experienced in Spain as tourists, concerned for their safety, have baulked at booking holidays in France (down 9%) due in part to the bombings in Niece, and in troubled Turkey and Egypt.
The outspoken head of Ryanair, Michael O’Leary, said the price of air travel over the period has fallen 8% during a period when oil price have risen.
O'Leary believes travel prices should continue to decline through 2018, "It's the airlines that are funding all of this. The UK is strong in volume but very weak in price," says the company's leader who has destination promotion agreements with several European capitals and airports.
