Tourism contributes nearly 12 pct of Portugal's economy in 2024, but growth impact slows

While tourism's share of GDP has remained stable since 2022, its contribution to real economic growth has declined sharply.

LISBON, Aug. 1 (Xinhua) -- Portugal's tourism sector contributed 34 billion euros (39.22 billion U.S. dollars) to the national economy in 2024, accounting for 11.9 percent of the country's Gross Domestic Product (GDP), according to the data released on Friday by the National Statistics Institute (INE).

While tourism's share of GDP has remained stable since 2022, its contribution to real economic growth has declined sharply. In 2023, the sector was responsible for 48 percent of total GDP growth, but in 2024, that figure dropped to just 15 percent, signaling a reduced impact on overall economic momentum.

Nevertheless, the sector's gross value added (VABGT) and tourism-related consumption (CTTE) showed solid nominal growth of 6.5 percent, slightly outpacing the broader economy.

Tourism-related consumption totaled 47.23 billion euros, retaining a 16.6 percent weight in GDP, the same as in 2023. Employment in the tourism sector also remained strong. During the post-pandemic recovery from 2021 to 2022, full-time employment in tourism grew by 14.2 percent, well above the national average of 5.7 percent, and accounted for 9.8 percent of all jobs in Portugal.

However, the sector continues to face structural challenges, most notably, lower wage levels. In 2024, average salaries in tourism stood at just 91.1 percent of the national average, with total remuneration in the sector representing only 8.4 percent of the country's wage bill.

While tourism remains a cornerstone of Portugal's economy, the data suggest that although the sector is still expanding in nominal terms, its capacity to drive broader economic growth is diminishing. (1 euro = 1.16 U.S. dollar)