The Illogic Of Mallorca's Tourism

There are two organisations in Mallorca which above all others deserve being listened to when it comes to tourism issues. Neither may be totally independent - (which organisation can be?) - but each does its best in being objective. The organisations are the Chamber of Commerce and the Universitat de les Illes Balears. They strive for objectivity, and one reason why they generally succeed in doing so is because they both undertake their own research.

Antoni Riera, professor of applied economics at the university, has been making some observations about the nature of Mallorca's tourism, drawing on a study that was undertaken last summer. The findings will come as no surprise, but they will be findings which, in certain respects, will be ignored. A key one has to do with private accommodation tourism, aka holiday lets. Tourists who rent accommodation spend on average 30% more than tourists who stay in hotels. This is spend which is necessary. It is what keeps a great number of the almost 50,000 tourist-related businesses (the complementary sector and tourism services) going.

Who will be doing the ignoring? Those who are not objective; the regional government being among them. The hoteliers will also want to ignore the findings except to point out that this rental market is partly illegal and unfair competition. It is unfair in different ways, one being that the accommodation is generally cheaper. And so it may well be. But that is the reason why those doing the renting can spend 30% more than the hotel-based tourist.

This 30% figure is striking not just in that it shows a much higher level of spending. It is also very similar to the figure for the total spend by tourists in Mallorca that ends up with the complementary sector. That figure is 29%. Where does the rest go? On hotel accommodation and price of the holiday package.

It needs to be noted that the hotel part of the equation includes all type of board and so not only all-inclusive, but all-inclusive has exacerbated the situation and quite dramatically so. Economic crisis brought about a significant increase in the level of AI. The consequence has been that, although Mallorca has registered record numbers of tourists in the past couple of years and has in fact registered record levels of turnover, the level of spend has declined and is continuing to decline. All-inclusives have seen to this and will continue to see to this.

As I say, none of this will come as a surprise. Indeed, none of it is new. But it sometimes needs organisations with real credibility to try and get the message across. The trouble is that they are consistently ignored, as was the Chamber of Commerce when it issued a report in 2006. This looked at the level of private accommodation holiday rental. One of the report's conclusions was that spending behaviour between hotel and rental tourists represented two distinct profiles. The former spent less than the latter. Another conclusion was that rental tourism lengthened the tourism season (the hoteliers have consistently said that it doesn't). A further conclusion was that a "more stable" tourist resort required a capacity for rental tourism.

We were given grand figures this week for the economic contribution of all-inclusives. 2.5 billion euros. At least there was an admission that the lion's share of this comprised the cost of hotel accommodation and the package. I've been seemingly banging my head against a brick wall for years trying to explain that spend statistics primarily consist of these costs. Just as others, like the Chamber of Commerce and the university, have been trying to explain that there is a vast tourism population which contributes negligible amounts to the local economy and that there is a significant tourism population which stays in rental accommodation which contributes a great deal to the local, non-hotel economy. If there was any logic to Mallorca's tourism, you would think that someone in government might reflect on the model of the island's tourism and conclude that the all-eggs-in-the-hotel-basket model is not necessarily the best model.

But then, when did logic have anything to do with anything? If it did, then the government would accept that there are distinct profiles of tourist, as the Chamber of Commerce noted in 2006, and as Professor Riera has reiterated this past week. One profile being that which makes a telling contribution to the general economy and another one which doesn't.