Travel and tourism strengthen as an engine of socioeconomic growth in Latin America and the Caribbean

Panamá, September 27, 2023 - The Latin American and Caribbean Air Transport Association (ALTA) reports that Latin America and the Caribbean (LAC) has shown a significant recovery in international tourist arrivals to countries in the region following the pandemic. In 2022, 91.9 million international tourists visited LAC, representing 78% of 2019 levels. As for this year, from January to July, a total of 65 million tourists were recorded, 8% below 2019. The subregion with the strongest recovery (Jan-Jul 23) was Central America, exceeding pre-pandemic levels by 2%. The Caribbean was 5% below and South America 13% below.

Colombia, Dominican Republic and Aruba show the best performance

The countries experiencing the strongest recovery vs. 2019 are Colombia, Dominican Republic and Aruba with 23%, 17% and 17%, respectively, above the months from January to July 2019.

At the beginning of 2023, the three main outbound countries of tourists to Latin America and the Caribbean were the United States, Canada and the United Kingdom. In this sense, the largest outbound market has been the United States and the country that receives the most tourists, Mexico, with around 24 million international tourists between January and July 2023.

"ALTA commemorates the World Tourism Day because aviation and tourism are completely related. Between 80% and 90% of tourists in the region arrive by air and we may affirm that air travel is the great gateway to countries. The more we work to generate efficiency and more and better options for passengers, the more tourists we will have. Latin America and the Caribbean is full of cultural, gastronomic and natural wealth. We have a lot to show and a lot to grow. Aviation is here to boost tourism and jointly generate more opportunities for socioeconomic development for our countries and people," said José Ricardo Botelho, ALTA's Executive Director & CEO, who highlights the valuable contribution of this sector, on the occasion of World Tourism Day.

The Travel & Tourism industry continues to be a driver of development

According to WTTC estimates, this 2023 the travel and tourism industry will create around 17 million jobs in the region, representing 7.9% of total employment (+0.1% vs 2019) including direct, indirect and induced jobs.

Likewise, data from WTTC show that this industry could contribute a total of USD 9 billion to the Latin America and the Caribbean (LAC) region, which would represent 7.9% of total GDP (+1.2% vs. 2019).

In the Caribbean, tourism is the industry that contributes the most to GDP with 11.5% and a 15.2% share of total employment.

Leisure trips and search for experiences are the most profitable ones

According to data from MasterCard, 85.3% of spending by tourists arriving in LAC is for leisure trips and their bookings for LAC countries have increased considerably compared to 2019.

Within this context, by the end of the first quarter of 2023, countries such as Dominican Republic, Jamaica and Costa Rica stood out notably with an increase of 226%, 129% and 107%, respectively, compared to pre-pandemic levels.

"The demand and spending on experiences has proven to be very profitable in the region, with travelers increasingly in search of access to experiences in different destinations around the world over material goods or things. This creates jobs for an extensive value chain. Not only restaurants, museums, cab drivers, but also small artisans, their providers and much more," Botelho argues.

In El Salvador, the leisure trip bookings have increased 214% compared to March 2019, while in Costa Rica they had an increase of 144% and Guatemala of 118%.

At the city level, significant increases have also been shown, such as in Los Cabos where there was an increase of 708%, Guayaquil (+218%), Quito (+95%), Belo Horizonte (+127%) and Porto Alegre (+93%).

"In order to leverage the full growth potential, governments must work on pillars that detract from the competitiveness in the region. These focus mainly on infrastructure and passenger taxes. The region has been improving substantially in these areas. But there is still a long way to go to capitalize on the full potential of an industry that in Latin America will grow up to 2.9% annually in the next 20 years," ALTA's CEO reflects.