Portugal has become a popular tourist destination among foreign visitors, welcoming almost double its population in 2023. With its beautiful destinations such as Lisbon, Porto, the Algarve coast, and the Azores, Portugal’s tourism industry has seen a significant increase in foreign visitors.
According to INE (National Institute of Statistics), the number of foreign tourists reached more than 18 million last year, up 19 percent from 2022 and 11 percent from the pre-pandemic year of 2019.
More than 18.3 million foreigners stayed in Portuguese hotels and tourist accommodation last year. In contrast, the hotel industry recorded a 5% increase in Portuguese travelers to more than 30 million guests. The UK is the largest source market, representing 18.4% of non-residential overnight stays, followed by German, Spanish, French and North American markets. The Canadian and North American markets recorded the strongest growth with increases of 56.9% and 32.9% respectively.
During 2023, overnight stays increased in all regions of Portugal. The greatest increase was observed on the island of Madeira, the northern region and the Azores archipelago. However, the Algarve on the south coast did not exceed pre-pandemic levels.
The tourism industry contributes to the Portuguese economy, which before the pandemic was around 15% of GDP. Despite the pandemic, tourism revenue helped the country achieve stronger-than-expected growth last year.
Portugal’s booming tourism industry is reflected in the congestion at the country’s main airport, Lisbon – Humberto Delgado. A plan to build a new airport, initially intended to complement and replace the existing airport, has been under consideration for decades. However, it is stalled due to various objections.
The government is also working on a high-speed rail project connecting the two major cities of Lisbon and Porto. Due to the increase in the number of tourists, the country has experienced a significant shortage of accommodation, and locals are struggling to find places to live. Additionally, Portugal is ending tax exemptions for foreign retirees this year.