Increase in interest rates will effect tourism

The President of the Portuguese Hotel Association (AHP) says that the ECB’s decision to put up interest rates will have effects on Portugal’s tourism industry.

In an interview with Antena 1 and Jornal de Negócios, Bernardo Trindade said that growth in tourism had “reached a plateau” but even so believed in positive results in 2023 that are superior to those in 2019.
The ex-Secretary of State for Tourism and owner of the Porto Bay Hotels Group, said that some caution or reserve was required when making forecasts for 2024, and admitted that a recession could influence the performance in the sector because of the impact of higher interest rates that would certainly have an impact on tourism revenues.
The AHP president did not wish to commit as to whether room rates would increase or fall, but said that the sector is “not palming off a sow’s ear for a silk purse” and that efforts made on investing on the quality of infrastructures and services had to be paid for. He also reminded that increasing revenues meant paying better salaries and paying more taxes, as was the case.
Bernardo Trindade also thought that the housing problem would not be solved by demonising Local Accommodation (Airbnb) and said that with legislative changes these structures could be considered not as Local Accommodation, but tourism developments.
The man who was also a former non-executive board member of TAP admits that the Portuguese airline could be integrated into large group that would enable it to gain scale providing it maintains Lisbon as hub, and doesn’t forget the Portuguese islands and overseas communities.