Spain is edging ever closer to becoming the world’s biggest foreign tourist hub, having attracted a record-breaking 94 million tourists in 2024.
The world’s most visited country and its closest competitor, France, received 100 million visitors.
But Spain’s post-pandemic recovery in its tourism industry has been nothing short of incredible, having received just 18.9 million in 2020.
In fact, the eurozone’s fourth-biggest economy has easily outgrown the likes of its neighbours, with an increase in GDP of 3.2% last year.
It comes as no surprise, therefore, that the Economist magazine ranked Spain as the world’s best-performing economy, and it has become to envy of Europe.
In comparison to Spain’s impressive growth, other countries have failed to keep up, with France growing by 1.1%, Italy by 0.5% and the UK by an expected 0.9%. The German economy, meanwhile, contracted by 0.2%.
“The Spanish model is successful because it is a balanced model, and this is what guarantees the sustainability of growth,” explained Carlos Cuerpo, the Spanish Minister of Economy, Trade and Business, the BBC reported. He added that Spain was responsible for 40% of eurozone growth last year.
While tourism played a huge role in Spain’s recovery from the pandemic, Mr Cuerpo also highlighted the importance of other industries including financial services, technology and investment. During this time, GDP shrank by 11% in just one year.
“We are getting out of Covid without scars and by modernising our economy and therefore lifting our potential GDP growth,” Mr Cuerpo continued, a process that has been aided by post-pandemic recovery funds from the EU’s Next Generation programme.
By 2026, Spain is set to receive up to 163 billion euros (£136 billion), making it the biggest recipient alongside Italy. This money is being invested in the national rail system, low-emission zones in its popular towns and cities, the electric vehicle industry and subsidies for small businesses.
“Public spending has been high, and is responsible for approximately half our growth since the pandemic,” added María Jesús Valdemoros, lecturer in economics at Spain’s IESE Business School.
Other countries, meanwhile, are struggling to see growth after putting greater reliance on industry, which Ms Valdemoros explained, is suffering due to reasons including high energy costs, competition from China and other Asian countries and transitions towards more sustainable practices.
Spain has also recovered well from its cost of living crisis, triggered by supply-chain bottlenecks and the Russian invasion of Ukraine in 2022. While inflation peaked at an annual rate of 11% in July that year, by the close of 2024 it had fallen back to 2.7%.
“Spain is proving to be more resilient to successive shocks – including the inflation shock that came with the war in Ukraine,” said Mr Cuerpo.
One of the major moves Spain made to mitigate the rising energy prices was to cut the cost of fuel consumption and encourage the use of public transport, as well as several increases to the minimum wage. The number of people in employment also now stands at a record high of 22 million, thanks in part to a labour reform encouraging job stability.
The European Commission has forecast that Spain will continue to lead growth among the bloc’s big economies this year and remain ahead of the EU average.
However, challenges are expected to hit the country, including backlash from its residents over the heavy reliance on tourism, which came to a head in protests across the country throughout last year.
