Irish tourism won’t make full recovery until 2026, industry group says

Soaring prices, the ongoing energy crisis and the impact of Government contracts with tourism accommodation suppliers risk undermining the continued recovery in tourism, with a full recovery not expected until 2026, the Irish Tourism Industry Confederation (ITIC) said on Tuesday.

The group estimates that seven million international tourists came to Ireland this year, meaning the industry is back to 73 per cent of the levels seen in the pre-pandemic peak of 2019. The rebound has been helped by pent-up demand for travel, deferred bookings, consumers’ accumulated savings and the restoration of air access.

Some 2.6 million came from continental Europe, which is down 28 per cent on 2019, the ITIC said, while 2.4 million came from Britain, down 30 per cent, and 1.5 million came from North America, down 22 per cent. Some 46 million came from long-haul markets, down 32 per cent.

The speed and strength of the recovery in travel to Ireland has exceeded expectations and the surge in demand surpassed most industry projections, said ITIC chairperson Elaina Fitzgerald Kane. However, estimates for 2023 range from a dip on this year’s performance to just single-digit growth, amid global economic headwinds, cost inflation and supply constraints.

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‘Momentum and recovery’

“We obviously hope that we can continue momentum and recovery into next year, but Government must enable tourism success by extending the 9 per cent VAT rate and reducing supply bottlenecks,” Ms Fitzgerald Kane said.

ITIC chief executive Eoghan O’Mara Walsh expressed concern that tourism accommodation supply would be restricted next year as a result of the impact of Government contracts with hotels to house Ukrainian refugees and asylum seekers.

“We now estimate that at least 28 per cent of all tourism beds in regional Ireland are not available to the tourism economy due to Government contracts. While hotels and guest houses are part of the solution to accommodate refugees, they cannot be the only solution,” he said.

“If this level of tourism accommodation stock is not available next year for international visitors, it could cost the broader tourism industry up to €1 billion in lost earnings”.

The ITIC has previously called for a “balanced” two-year humanitarian plan from Government that includes the use of vacant buildings, State institutions, unused dwellings and modular housing as well as tourism accommodation stock.

“If there are no tourism beds in tourism towns next summer, there will be no tourism activity and that will have a very negative impact on local economies,” said Mr O’Mara Walsh.