Domestic tourism to the rescue

In the second quarter of this year there were almost 50,000 local residents who chose to spend a night in hotels in Malta or Gozo. This was three and a half times the amount in the second quarter of 2020.

More important is the fact that domestic tourism in the second quarter of 2021 was 21% higher than that observed during the same months in 2019, that is before the pandemic hit Malta. The fact that there has been such a sharp increase in domestic tourism confirms the extent to which the financial situation of the Maltese and Gozitans has held so well.

This contrasts sharply with the situation in Malta following the 2008 financial crisis. While this year we have seen a rise of nearly 10,000 domestic tourists compared to the pre-pandemic situation, in the same quarter of 2008, though the economic shock was much lower, the number of domestic tourists had fallen by 2,000, or by 6.5% on an annual basis. The main reason behind this was that during the 2008 crisis, Maltese households were left unsupported and burdened by excessive utility tariff increases. A very different situation from the progressive policies adopted by the current administration, which instead of sending higher utility bills, sent vouchers to be spent in shops, restaurants and hotels.

Domestic tourism in the second quarter of 2021 was 21% higher than in 2019.

25% more hotel nights than 2019

While between April and June 2019, the Maltese and Gozitans had spent 98,685 nights in hotels in our country, in the same months of 2021 they spent 122,917 nights. This means that compared to before the pandemic, the number of nights stayed in hotels increased by 25%. In addition, there has been a sharp increase in the rental of private accommodation, such as farmhouses and flats, especially on the island of Gozo. 

Besides this boom in domestic tourism, the second quarter also saw an increase in foreign tourism. There were more than 94,000 tourists staying in hotels this year, compared to just over 3,000 last year. These tourists spent almost half a million nights in our country, against less than 34,000 overnight stays in the same months in 2020.

Comparing these results with those of 2019, one finds that hotels had a quarter of overall visitors, considering both local and foreign customers. In fact, between April and June 2021 there were just under 144,000 people spending a night in hotels in our country, against more than 575,000 in 2019.

Gozo 5-star hotels reach 53% of pre-COVID numbers

The best performing category compared with 2019 are 5-star hotels in Gozo. These establishments hosted 3,500 people between April and June 2021, compared with 6,800 in the same months two years ago. This means that they have already reached 53% of their pre-pandemic record. In contrast, 5-star hotels in Malta reached 30% of their visitor numbers in 2019.

It should be noted that these results were achieved in a period, compared to today, when there were stricter restrictions on activity and before the voucher scheme started to have much of an impact. The indications are that after June, both domestic and foreign tourism activity accelerated. Statistics released by the MIA indicate that in July passengers passing through the airport were 39% of the 2019 level, almost three times the April-June average. At the same time the number of passengers crossing the channel between Malta and Gozo for Santa Marija were higher than a year ago.

The recovery of tourism is a key factor underpinning the decline in the level of unemployment to historic minimums, especially on the island of Gozo. It also explains why the number of tourism operators in need of a bank moratorium has decreased from 455 in August 2020 to just 29 today. At the same time there was an increase of only 47 in hotels and restaurants that needed their borrowing to be guaranteed by the Malta Development Bank.

It is clear that the financial situation of Malta’s tourism sector is well on the way to recovery, further boosted by the commitment by Government that operators will continue to be supported by the wage supplement scheme.

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