KOF Forecasts for Swiss Tourism: Good Winter for Alpine Regions

Alpine regions outperform the towns and cities

Although the Swiss tourism sector underperformed expectations last winter, it still managed to grow. Whilst the unexpectedly sluggish economy and the slightly higher exchange rate dented demand in the tourism industry, the plentiful snow and the favourable weather conditions had a benign effect – especially in the Alpine regions, which consequently witnessed stronger growth in overnight stays than the towns and cities did. Central Switzer-land, Grisons and the Bern region benefited especially. The total number of overnight stays during the winter season rose by 0.6 per cent year on year.

Guests from Switzerland generate robust demand

The prospects for the coming summer season remain bright. Although economic activity has been weakening, domestic demand is likely to remain robust because the Swiss labour market is in good shape. Demand from abroad, on the other hand, is expected to grow slightly more slowly than last year because the international economic outlook has deteriorated significantly. Assuming average weather conditions, the number of over-night stays is forecast to rise by 2.1 per cent during the next summer season.

Forecast up to 2021: recovery in overnight stays by guests from the euro area – with exceptions

The forecasts of tourist numbers over the coming years are also optimistic. The price competitiveness of Swiss destinations has improved in recent years thanks to the price restraint shown by tourism operators. The highest growth rates will probably continue to be generated by overseas markets – especially by guests from Asia and North America. The number of overnight stays by guests from the euro area should continue to recover provid-ed the Swiss franc does not appreciate any further against the euro. The prospects for the neighbouring coun-tries of France and Italy, however, remain quite subdued. For British guests, too, the longer-term outlook is fairly gloomy. On the other hand, domestic demand is growing faster as a result of the currently healthy economic situation and Switzerland’s stronger price competitiveness compared to other countries. KOF expects the num-ber of overnight stays by tourists during the current year to rise by around 1.5 per cent, while growth of 2 per cent is forecast for 2020 and 2021.

Prices are set to rise slightly more sharply

Spending by guests from abroad continued to recover last year after having plummeted in the wake of the Swiss franc shock of 2015. Having risen by 4.4 per cent last year, however, spending will grow by a more mod-erate 3.1 per cent this year. The low level of inflation and the Swiss franc’s stable exchange rate against the euro are providing the domestic tourism industry with further leeway in its pricing strategy. Although prices only rose by a modest 1.1 per cent last year, they are set to increase by 1.6 per cent this year. The gross value added in the tourism sector is forecast to grow by 2.2 per cent this year.

Specialist analysis: an interactive tool for tourism forecasts

KOF has developed an interactive online tool to make the results of its tourism forecasts more readily available to the interested general public. The tool is designed to enable users to select and display the forecast infor-mation of particular importance and interest to them. The main feature of the interactive tool is that it presents historical trends and forward-looking forecasts of overnight stays. In addition to these predictions it also dis-plays graphs and charts of key background information and statistics on the Swiss tourism sector. The online tool can be downloaded from KOF’s website and will be constantly updated and expanded.