Welcome to Sapienta Cyprus Reflections, a sub-category of Sapienta Cyprus Snippets. It is free for now. You can read more about each series here.
Before Russia’s invasion of Ukraine in February 2022, one would frequently hear Cypriots declaring that Russian tourists were the biggest spenders in Cyprus. Perhaps it was because of the high-end restaurants in Limassol serving mainly Russian resident clients. Perhaps it was because of a perception that all Russian tourists were billionaires, rather than package tours of babushki from Siberia.
Either way, it was false. It was not true before the Ukraine war and it is definitely not true now that arrivals from Russia have collapsed. More detail on arrivals statistics can be an article for another day. This particular article is about per-capita tourism spending.
Up-to-date figures are hard to come by
One reason why myths persisted about the highest spenders in Cyprus is because getting hold of expenditure by the country of origin of tourists has not been so easy.
In the past, to get the statistics for “Year T”, you would often have to wait for “T+1” or even longer to get it. For example, the annual statistics for 2014 were not published until March 2016.
In addition, to get a broader range of countries, and not just the top few, it is still the case that you have to glean it from monthly statistics.
This means that, if you want to make comparisons between years, it involves laboriously copying over data from up to 24 individual Excel files so that you can create two sets of 12 months with which to compare “Year T” with “Year T-1”.
Now, at long last, the Statistical Service, Cystat, has started to produce more up-to-date annual statistics on tourism spend by country. It does not show the entire set of countries but in February 2024, just six weeks after the end of 2023, it published preliminary full-year figures for 2023 as well as data for 2022.
I have reproduced those in the table below, and dug around about 20 other files to fill in as many gaps as possible in the previous years.
The answer to the question of which country’s tourists spend the most per capita when they come here on holiday is … (drum roll) Germany.
Strictly speaking, Germany is the top among the top tourism markets. The actual top based on available data seems to be Switzerland but the absolute number of arrivals from Switzerland is low.
I have to say that I found it surprising that Germany came out top among the main markets. Germany, where decades ago I lived for a year, is a country that I associate with discount supermarkets and a focus on saving, not spending. But it seems I am out of date.
Not only did Germans outspend Britons in 2023, they have actually been outspending Britons for some years now.
Looking back at data to 2010, the main change seems to have come from 2017, when Germany decisively took over Britain as the highest spender among the main tourism markets. Moreover, unlike in previous years, it did not slip back behind the UK again.
Don’t mention the B word
What happened that made 2017 so different? The answer is a weaker pound sterling, which essentially made going on holiday more expensive for Britons.
As you might remember, something rather momentous happened in the UK in June 2016, namely the referendum in favour of leaving the EU (Brexit).
As you can see from the chart below, from 2017 we see a steep drop in sterling and then only a modest recovery since then.
Sterling has seen steep declines before: after the dotcom bubble burst in 2000 and after the global financial crisis in 2008. And after some crashes, it has been known to recover.
For the time being, however, it looks as though sterling is stuck at a weaker rate than before the referendum. That suggests that Germans will continue to outspend Britons for a while yet.
Have you seen the Sapienta Cyprus Reflections series?
· Cyprus interest rates: how do they compare? 21 Feb 2024
· Green finance: how will it affect your business? 25 Jan 2024
· How to bring the people into a Cyprus peace process, 18 May 2023
· Three mega trends to define the decade, 11 May 2023
· Cypriots and sanctions: lessons for other professionals in Cyprus, 18 Apr 2023
· Cyprus and security: it’s time to change the toolbox, 14 Feb 2023
· What do we know about Turkish Cypriot banks? 4 Jan 2023
· How much is Russian business worth to Cyprus? 12 Dec 2022
· The amazing Cyprus growth machine 17 Nov 2022
You can find a full list of all posts here.