Constituting the third-largest economic activity in the EU, tourism is of considerable importance as a source of economic growth, regional development and employment. In fact, it accounts for 10% of the EU’s GDP and 12% of employment - many of which are within SMEs. In Greece, this figure rises to 24.8% of total employment dependent on tourism, while in Portugal it reaches 20.4%.
Eurostat indicated that for 2015 one in ten enterprises in the EU non-financial business economy belonged to the tourism industries. Together they directly employed a total of 12.7 million persons.
British tourists contribute significantly to this economic sector and they consistently make more visits abroad than foreign residents make to the United Kingdom. Britons spend five out of six of their foreign holidays in EU countries, representing one-fifth of foreign overnight stays within the EU.
According to the UK Office of National Statistics, a total of £28.7bn was spent in Europe by British tourists in 2017.
Southern Europe profits most from this. Indeed, Spain is the most visited EU country by Britons, where the latter are worth £12bn alone to the industry. This represents 25% of the 2016 tourist expenditure in Spain.
Hanseatic countries are also popular destinations for British residents, with France (£3.9bn), the Netherlands (£1bn) and Germany (£1.1bn) as top choices.
That being said, Scandinavian and Baltic countries are becoming more and more popular. These countries have seen an increase in British tourism during the last decade with high annual growth. Lithuania has had the highest increase with 20.7% between 2013 and 2017.
Investments in this industry in Northern European countries is thus flourishing. The coming years will bring more British travellers to the region and total spendings will surely move beyond their 2017 peak of £9.5bn.
Tourism in general, and British tourists in particular, are thus set to become an increasingly important part of the service economy of northern Europe. As many of the business involved are SMEs, it puts a duty on the Commission and national governments to create a regulatory environment that suits flexible and fleet-footed service-sector businesses.