A potential reduction in tourist flows in 11 major European capitals for three years, with the logic that this will limit the effects of the overconcentration of tourists in them, will lead to the loss of 245 billion dollars in GDP, 122 billion dollars in tax revenues and 3 million jobs, warns the World Travel and Tourism Council (WTTC), with a new report-slap for the voices that claim that limiting tourist activity in major destinations is the solution to avoid overtourism and its consequences.
Instead, WTTC calls for a smarter and more balanced approach, saying that instead of losing these resources, destinations should reinvest in them. After all, as the report “Managing Destination Overcrowding: A Call to Action” states, while overcrowding is often seen as a tourism problem, many of the real pressures stem from deeper issues such as underinvestment in infrastructure, poor planning, and fragmented decision-making.
“Failing to recognise the benefits that travel and tourism create can come at a cost,” the WTTC says in the report. “It is time for governments, businesses, and societies to work together to ensure that travel and tourism enhance rather than detract from the world’s most valuable places.”
As the WTTC highlights, overtourism can have economic and social costs, but it is necessary to assess how these compare with the benefits generated by the sector, and whether tourism revenues can be better managed to offset these costs and ultimately improve the quality of life of residents.
The travel and tourism sector supports one in 10 jobs – in the next decade, it is expected to support one in three jobs – and represents almost 10% of global GDP. By 2024, its contribution to the global economy is expected to reach $11 trillion and to employ 357 million jobs. Governments earn $3.3 trillion annually from businesses in the sector, or 9.6% of global tax revenues.
In this context, the WTTC report refers to two scenarios of the impact of the potential limitation of tourism activity in 11 major city tourist destinations in Europe, where tourist nights per capita exceed the European average (Venice, Rome, Dubrovnik, Paris, Barcelona, Amsterdam, Lisbon, Prague, Dublin, Munich and Vienna), assuming that the volume of tourists decreases to the European average.
At the same time, the economic impact of measures to limit the number of tourists in a city would affect GDP, employment and tax revenues on a much larger geographical scale, the report highlights.
Scenario 1 | 245 $11 billion in losses in 11 major European cities
In the first scenario, limiting total travel demand (both international and domestic) to the average of European cities, for the period 2025-2027, would result in a loss of $245 billion in total Travel and Tourism GDP. This is comparable to the total GDP generated by tourism in countries such as India and Italy.
At the same time, the scenario predicts a loss of $122 billion in total tax revenues (excluding tourism-related special taxes), an amount that exceeds the annual EU budget needed to modernize the electricity grid, which is critical for energy security and climate goals.
The same scenario also includes the loss of almost 3 million jobs.
More specifically, in the same scenario,
Venice could lose up to $14.1 billion in direct GDP and an additional $18.4 billion in indirect GDP, impacting the wider economy of the region.
Amsterdam could lose $12.4 billion in direct GDP and $23.6 billion in indirect GDP.
Restricting tourism in both cities could lead to 393,000 job losses in Italy and 364,000 in the Netherlands.
In relative terms, Venice could see an 11% decline in the city’s total GDP, while Dubrovnik would experience an even greater decline, of around 22%.
Venice could see a 16% loss in total jobs, and Dubrovnik -27%.
In terms of the total fiscal impact, Venice is expected to lose $15.2 billion, meaning Italy would lose funding equivalent to building 260 hospitals, and Amsterdam would lose $21 billion.
Scenario 2 | What happens if only international demand is limited
In the second scenario, for the three-year period 2025-2027, limiting international demand exclusively to reach the average of European cities in international travel would result in a loss of GDP of $186 billion, total tax revenue of $91 billion, and almost 2.3 million jobs
Specifically,
Barcelona could lose up to $11.7 billion in direct GDP and an additional $17.3 billion in indirect GDP, with the impact spreading across Spain. Restricting international tourism to the city could lead to the loss of 341,000 jobs nationwide. Meanwhile, the total tax loss would reach $11.6 billion.
Paris could lose $12.8 billion in direct GDP and an additional $17.2 billion in indirect and induced value. Up to 284,000 jobs could be lost, and the total tax loss could reach $16.2 billion.
The Athens Development Agency is among the good examples of tourism management in Europe
WTTC proposes the adoption of 6 guidelines, with the participation of all industry stakeholders, decision-makers, local communities, and visitors, aiming for a more resilient future for tourism. Good examples include the Athens Development Agency, for the creation of an online tourist guide with walking routes to the city’s monuments and museums, which helps visitors navigate places outside the Acropolis.
The guidelines for more sustainable tourism in European cities are the following…
Organization | Collaboration of all stakeholders through strong task forces
Make a plan | Define a common vision and destination strategy
Gather evidence | Lack of data exacerbates tourism issues in many destinations, so it is critical to conduct research and provide evidence-based responses to the specific challenges each destination faces.
Remain vigilant | Study the conditions and act early
Invest smartly | Reinvest in infrastructure and resilience, with transparency about where the money goes
Empower residents | Ensure residents have a voice and understand the benefits of travel and tourism in their communities.
