In Switzerland, the tourism sector is expected to suffer the consequences of global geopolitical turbulence. Economists anticipate a decrease in overnight stays during the summer season, a first since the end of the Covid-19 pandemic.
During the summer season, a 1% decrease in hotel overnight stays is expected, to 24.9 million, according to economists at BAK Economics, who provide these forecasts on behalf of the State Secretariat for Economic Affairs (SECO). The expected decline is attributed to a lower demand from clientele from distant markets, with a feared 3.7% drop in overnight stays.
The conflict in Iran has disrupted air traffic, explaining the caution of international travelers. Initially, airspace closures primarily restrained demand. “These closures particularly affected major airports in the Middle East such as Dubai, Abu Dhabi, or Doha,” explained Simon Flury, Tourism project manager at BAK Economics.
In addition, the rise in fuel prices now adds to the overall cost of long-haul travel.
Fewer Asian visitors
Asia is the most affected region, particularly India and Southeast Asian countries, as the Middle East airports are typically transit hubs for air traffic to Europe. Moreover, many of these countries rely on Gulf countries for their energy supply. “In March, we already saw significant losses, with India dropping by over 30%,” said Simon Flury. However, China is expected to fare better due to direct air links to Switzerland.
Across the Atlantic, the United States is expected to see slight growth but slowing compared to previous years when they were a driving force. Rising flight prices and economic uncertainty are affecting the demand.
“The 1% is just the tip of the iceberg”
Speaking on Friday on Forum program, Xavier Rey, president of the Geneva Hoteliers, confirmed the noticeable decrease in bookings from the Middle East and Asia. He highlighted the challenge of replacing guests from countries with substantial expenditure in restaurants and shops. While efforts are made to attract clients from other markets, the loss of high-spending visitors poses a significant challenge.
The domestic demand and some European markets will play a stabilizing role amid global upheavals. An increase of 0.5% in overnight stays by locals is expected, even as private consumption might be hindered by higher inflation.
“It is important to realize that every canceled trip to Dubai or Thailand will not be replaced by a week in the Swiss mountains,” noted Simon Flury.
Overall, overnight stays by European guests are expected to decline by 1.0%, mainly due to a high comparison base from 2025, which had major events like the Women’s Euro football tournament. A particular decrease is expected from guests coming from the UK.
(Source: ats/ther)
