Greece is over-reliant on tourism
Tourism generates over a quarter of Greece’s gross domestic product, according to data presented on Wednesday by the Institute of the Greek Tourism Confederation (INSETE). The data highlight the industry’s importance to the national economy and employment, as well as tourism’s quasi-monopolistic status in the country’s growth.
According to the latest figures available, at least one percentage point out of the 1.9 points of economic expansion last year came from tourism.
The INSETE report showed that tourism had a direct impact on the economy in 2018, amounting to 21.6 billion euros or 11.7 percent of GDP. This was up by 13.3 percent or 2.5 billion euros from 2017. Directly and indirectly, tourism accounted for between 47.4 billion and 57.1 billion euros, or 25.7 to 30.9 percent of GDP.
Given that travel receipts rose by 10.1 percent last year from 2017, per the Bank of Greece, to reach 16.113 billion euros, tourism has added 1.483 billion euros to Greece’s GDP just through its direct impact, and much more indirectly. These figures amount to about half of the economy’s total expansion.
That also illustrates the country’s great dependence on tourism, as Greece has not developed any other important sector, with the possible exception of shipping, which accounts for about 7 percent of GDP.
At peak season last year, tourism employed 411,000 people in accommodation and food service companies alone, contributing 16.7 percent of the country’s employment. When the indirect impact of tourism is factored in, including professions such as transport etc, its share in national employment ranged between 36.7 and 44.2 percent, making it the main factor in the reduction of unemployment, particularly for young people, according to INSETE.
The tourism sector also made a sizable contribution in terms of investment activity, amounting to 5 billion euros in 2018, and 90 percent of the sector’s revenues originated from abroad.
