The Revival of Tourism Industry and Albanian Riviera Opportunity
Opinion by arsim@thejournalbiz.com
The travel and tourism industry, widely known as ‘tourism’ in a broader terminology literature incorporates many industries, or subcategories that include: accommodation, transport, attractions, and more. Globally, travel and tourism’s direct contribution to gross domestic product (GDP) was approximately 7.8 trillion U.S. dollars in 2022, based on Statista’s research, that’s roughly an 8 % share of the total global GDP.
Out of all industries in the market, tourism is considered to be the most prevalent among nations. Be it for recreational purposes or otherwise, tourism had a steady growth until the pandemic came and shifted everything for the worse.
Statista chart on the Travel industry and the effect of pandemics
Statista chart, source UNWTO
Immediately after WHO declared C-19 as a global pandemic, isolation and travel restrictions soon followed.
Speaking from today’s perspective, tourism indeed faced the worst-case scenario, and no wonder the pandemic plunged the industry into the Stone Age era.
- No industry has been spared by the impact of the pandemic, but fewer have been hit as hard as the tourism industry.
According to the UNWTO statistics before isolation, we can argue that the pandemic made the 20/21 “the worst years in the tourism history”, as international tourists recorded a significant decrease, while travel restrictions remained in place for protracted periods in many parts of the world.
However, global tourism bounced back strongly in 2022, as international tourist arrivals more than doubled compared to the previous year and that was a sign of a healthy recovery. According to UNWTO, international tourism revival could reach a 95 percent of pre-pandemic levels this year.
UNWTO Chart on Travel & Tourism Impact Recovery
UNWTO Chart 2022/2023
Now, three years after the WHO declared C-19 a pandemic, optimism has returned to the most preferred industry for the global consumer, as the market has recorded a new entry with steady growth, the Albanian Riviera.
As an unexplored market with tremendous opportunities, Albania has been increasingly considered a country that offers not only beautiful beaches, delicious food, and affordable prices in the market, but also represents an investment opportunity for large investors as the global crises and inflation are looming, on the other hand, tourism remains, just like the big tech in the stock market, a viable option for strategic investments.
It is no coincidence that the Albanian Riviera is on the list of some of the most serious investors in the market. Albania managed to surprise many when for the second year in a row notched the top ranks of the UNWTO, as the country with the largest tourism growth in Europe.
UNWTO Global chart on best performing destinations 2023
UNWTO yearly global chart on Int’ Tourism
Legal reforms, strict construction permits, and fast-tracking real estate documents of the ownership have increased the appetite of foreign investors who, in their hedge planning consider investing in the Albanian Riviera as a viable option, as is the case with the investor Jared Kushner, the son-in-law of former President Donald Trump, as reported by Bloomberg.
The fact of the matter is that Mr. Kushner, as a co-founder of the strategic investment fund ‘Affinity’ will manage a portfolio of over 2 billion $ provided by the Public Funds of Saudis. This means that Mr. Kushner, alongside his partners at ‘Affinity’ is seriously considering investing in Albania, (with long-term projections in mind ) that serves not only as a hedge against inflation but also as a long-term investment plan.
Beyond the media hype and social media trends, I’ll try to summarize some of the most favorable and least favorable points that the Albanian market is currently offering:
- According to the UNWTO estimates, the international tourist arrivals in Albania will continue the influx, and new records are expected this year.
- The global booking agency “Booking.com” according to the most recent surveys has ranked the Albanian coast, Vlora in specific as one of the top trends of this year, and
- The ‘Mirror beach’ near Saranda according to the research by CV Villas has the cleanest beach with the ‘bluest clear water in Europe’ while Albania for the first time since the fall of communism is expected to have over 11 million tourists within a calendar year
Referring to the National Bank report, the tourism revenues during the first 9 months of the previous year were over 1 billion euros more than in 2022. Specifically, 8.2 million tourists who came (from January to September) spent over 3.2 billion euros, while last year this value was estimated at circa 2 billion euros
Based on these projections, Albania is expected to generate over 5 billion euros this year alone, and this is a significant increase, considering that a decade ago, Albania hardly reached 700 million euros in annual tourism income.
However, the worrying signs are there and the lack of modern infrastructure, non-efficient railways, and very poor public transport alternatives and safety makes all the hype for the Albanian ‘Maldives’ back to reality check, hence the prices are still considered ‘affordable’ in the market. In addition, pollution is still evident in and around beaches while the lack of safeguards at the public beaches is something of an emergency matter that the Albanian authorities must tackle if they want to be considered ‘an option’ in the international tourism industry.
