Tourism may help support long-term economic growth

RTÉ News​

26-05-2025

A new report shows that while export-driven economic growth in the first quarter of this year may not be sustainable, efforts to boost domestic tourism should help to sustain employment and support more balanced growth.
But the latest SME Monitor from Banking & Payments Federation Ireland (BPFI) also shows that cost pressures and price increases remain.
Early estimates from the Central Statistics Office shows that Irish gross domestic product (GDP) is up 13.3% compared to the same time last year.
BPFI said that most of this growth, however, was driven by multinational exports.
It said that 99% of the increase of €34.3 billion in total exports was accounted for by exports of medical and pharmaceutical products, largely due to front loading - particularly to the US - by multinational firms reacting to tariff threats by the new US administration in early April.
Today's survey also noted that employment reached historic highs by the end of 2024, with 2.8 million people in work, almost 400,000 more than pre-pandemic levels in 2019.
Irish-owned businesses accounted for nearly 75% of total employment and 66% of total earnings in the Irish economy, according to recent CSO data.
Today's survey noted that in the hospitality sector, some 86% of employment is in Irish-owned enterprises.
Ireland saw 6.6 million foreign resident visitors last year who spent an estimated €8.2 billion, including on travel fares, up 12% from 2023.
BPFI said that while nearly 1.1 million foreign residents visited Ireland in the first quarter of 2025, that was down from 1.4 million visitors during the same time in 2024.
"Given their importance to the economy, this trend in foreign visitors should be monitored closely, but domestic tourists also make a crucial contribution to the sector," Brian Hayes, the chief executive of BPFI, said.
"Irish residents spent an estimated €3.6 billion on domestic travel in 2024, an increase of 15.3% year-on-year. More broadly, Irish consumers and businesses spent €12.3 billion in hospitality and tourist outlets in Ireland in the 12 months ending March 2025 according to BPFI analysis of payment card data from the Central Bank of Ireland," he said.
80% of tourism businesses expect stable or increased visitor numbers in 2025, according to Fáilte Ireland's latest Tourism Barometer.
But Brian Hayes cautioned that cost pressures along with continued increases in prices could risk Ireland's affordability and competitiveness in the tourism sector in the future.
"It is encouraging to see that with the publication of the new Tourism Policy Framework for the period to 2030, there are new efforts to boost business tourism and year-round domestic travel," he said.
"Given that global trading conditions are likely to deteriorate, and Ireland's reliance on foreign direct investment, these efforts will be critical to ensuring that growth is more balanced and not overly reliant on unpredictable international trends," he added.