The Algarve has trumped Prague having risen to the number one spot for the most affordable holiday destination for British tourists.
While prices fell by as much as 31% in more than half the 44 cities and resorts surveyed worldwide, in the Algarve the drop was recorded as 19% by the annual Post Office Travel Money report.
The cost of tourist essentials, such as meals and drinks, were compared to rank the destinations in order of value for UK tourists.
The Algarve emerged as the cheapest for the first time in five years.
Here tourists can expect to pay an average of £16.77 for a three-course evening meal for two, including wine, the report found.
Next best value spot was the Bulgarian resort of Sunny Beach where prices also dropped some 18%.
Cape Town was placed as number three as prices there too represented good value for money. Costa del Sol followed closely.
“In Europe, the best deals are likely to be in Portugal and Bulgaria, where increased competition to attract tourists has resulted in lower prices for tourist staples,” said spokesperson Andrew Brown.
“Once the exchange rate is factored in, tourists should see their spending costs shrink. For those travelling further afield, Cape Town, Bali and Tokyo look good bets for the bargain-hunter.”
Last year Prague held the number one position but rising meal prices have pushed up prices nearly 14%.
Paying the price for sterling’s current strength are Jumeirah in Dubai which is the most expensive place for British tourists.
The strong dollar also makes trips to the US and Caribbean pricier, with costs up at resorts such as Orlando, Antigua, Barbados, Jamaica and St Lucia.
