Despite the Donald Trump effect, the number of foreign visitors to Mexico grew 9% in 2016 to hit a record 35 million, while total tourist spending was up 10% – great news for an industry which accounts for 8.5% of the country’s GDP and is a key part of its jobs market.
Experts put the growth down to the weakness of the peso against other currencies, the strength of the US economy and the growth in air connections with the United States, Europe and the rest of Latin America.
Also playing a role is the political instability of competitors, including Turkey and Egypt, lowering the appeal of those destinations for European travelers.
“The Mexican tourism sector is enjoying a very good moment, even surpassing our expectations in 2016,” says Francisco Madrid Flores, Director of the Tourism and Gastronomy Faculty at the country’s Anahuac University.
Meanwhile former tourism minister Gloria Guevara is optimistic about the sector’s future, highlighting the “excellence” of the country’s tourism product, and noting many Mexicans will choose to stay at home rather travel to the United States in the coming years given the hostile stance taken by US president Donald Trump toward Mexico on issues including immigration and trade.
“Mexican are starting not to go [to the United States] to avoid being mistreated or having a bad experience and to support their country under these new circumstances. This will help spur on internal tourism” says Guevara.
To further demonstrate the rude health of the industry, the former tourism chief also cites World Tourism Organization figures showing that 2016 marked the first time since 1998 that Mexico’s tourism revenue outstripped income from oil sales.
Despite the optimism of tourism experts, however, challenges remain. In an exhaustive report published in January, the Organisation for Economic Co-operation and Development (OECD) said Mexico needed to diversify, moving away from a form of mass tourism which contributes little to local and regional economies and toward more individualized products.
“I’m not sure I agree: of course I would like to see small-scale, traditional destinations, but that won’t solve the poverty problem across much of the country. Mass tourism is overly demonized,” says Madrid of the rise of ‘all-inclusive’ tourism packages in a lot of resorts on the Pacific Coast and in the Mexican Caribbean.
The tourism expert also highlights the growth of higher-end tourism in locations like Los Cabos in Baja California on the Pacific coast, where the average cost is double that of the rest of the country.
“There is no need to abandon the mass tourism model but we have to explore new niches,” says Madrid.
The second challenge for Mexico is the eternal problem of insecurity, with violence related to the drugs trade a major concern. While most tourists find their preconceptions shattered when they visit the country, Mexico’s reputation is worsening each year, according to the Good Country Index, which measures how much countries contribute to the greater good of humanity.
But recent violent incidents including two shootouts that left nine people dead in January in Cancún have not impacted on tourism, according to Gerardo Corona, Mexico’s Vice-Secretary for Innovation and Tourism Development.
“These events usually have less an impact than you might think,” says Madrid.
Last but not least, Mexico needs to diversify its visitor base, but without ignoring the importance of the US market, according to Corona. Some 88% of the country’s tourism income comes from Mexicans visiting other parts of Mexico, but depending on this revenue stream is a risk given the fragile state of the country’s economy.