EconomyFinancialGoodbye to the Covid crisis: Mexico is shaping up...

Goodbye to the Covid crisis: Mexico is shaping up to close the year with record levels of foreign exchange from international tourism

Mexico is not only recovering international tourists after the crisis caused by the covid-19 pandemic, but travelers are spending more during their stay in the country. So far this year, the growth of foreign currency income from foreign tourists has grown in double digits, mostly compared to 2019, and is on track to close the year at a threshold that would mark a new record for the country.

The Ministry of Tourism (Sectur) estimates that the country will close the year at a threshold of 26,000 million dollars, which would mean 7% more when compared to the little more than 24,000 million dollars registered in 2019.

The estimates of the initiative go a little further, since they foresee that at the end of the year there will be an accumulated amount of 30,000 million dollars in foreign currency , which would be 24% higher than what was received before the pandemic.

Part of these forecasts are fueled by the progress that has been made both in attracting international tourists, and in the growth in foreign exchange income from them.

On the one hand, the recovery of the international segment –the most affected by the pandemic, which, despite this, recovered quickly due to the permanent opening of borders that the country had– would be close to recovering pre-COVID-19 levels.

“At the end of 2022, the arrival of 42,301,000 international tourists is expected, 10,425,000 more than what was registered in 2021, this is an increase of 32.7% and only 6% to reach the level observed in 2019”, said Secretary of Tourism Miguel Torruco Marqués, in a report from last August.

In addition to this, the advance of currencies in the monthly comparison with respect to 2019 is encouraging. Although in January spending was still 94.5% away from reaching pre-pandemic levels, a 3.7% growth was registered for February, and for the summer it reached a rise of 23.5%.

For Braulio Arsuaga, president of the National Tourist Business Council, this dynamic is the result of a combination of the recovery in the demand for travelers with an inflationary effect, which has led to an increase in tourist services, while some segments have dealt with others price rise factors, such as air travel, where the rise in jet fuel prices has been passed on to the consumer through higher rates.

“It’s a mixture of both, because we were open and there were still certain reserves of people traveling to Mexico, coupled with high prices for certain services,” explains Arsuaga. “Tourism potential should be measured by spending per capita; that there is more spending is correct, but we are still a long way from other markets. It went up to 1,000 dollars, but there are countries that have up to 7,000 dollars.”

Despite the expected dynamism, there are still some segments that have not fully recovered, and boosting them may be the key to preserving what has been gained in terms of spending.

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