Canary Islands

• The Canary Islands have 2.3 million inhabitants, 4.6% of the total, and it is the Spanish region with the seventh largest population. It is one of the oldest autonomous communities: 18.7% of the population is over the age of 65 (21.1% on average).
• The GDP of the Canary Islands (58.145 billion euros) accounts for 3.6% of Spanish GDP, the eighth highest of all regions.
• GDP per capita (25,861 euros) is the third lowest in the country and 20.8% below the national average. The region has been falling further behind the average, due to strong population growth coupled with a less buoyant economy.
• The Canary Islands’ sectoral composition is heavily dependent on the tourism sector, which is reflected in the importance of trade, transportation, hotels and restaurants, and leisure (38.8% of GDP, 10 points above Spain as a whole). The public sector also plays a key role (20.7% vs. 17.3%). However, the manufacturing industry is of far lesser importance (2.9% vs. 11.9%).
• In line with the less prominent role played by industry, exports of goods account for the smallest proportion of GDP of all the regions (4.5% vs. 24.1% in Spain): almost 60.0% are energy products – fuel for aircraft and ships. In contrast, exports of tourism services are particularly important for the Canary Islands: in 2025, foreign tourists spent over 24.4 billion euros in the region, 18.1% of the total expenditure across Spain, and tourism’s direct and indirect contribution to the Canary Islands’ GDP stood at around 38%.

The Canary Islands’ economy has experienced strong growth since the pandemic and is now among the most buoyant in the country. At CaixaBank Research, we forecast GDP growth of 3.1% in 2025 (2.8% in Spain), mainly thanks to the upturn in tourism, which also boosted job creation and consumer spending.

For 2026, our forecasts indicate that GDP growth will slow down to 2.2%, but will remain above the average (2.1%). Although tourism will lose momentum after a few record-breaking years, it will continue to be the main driver of activity. Moreover, geopolitical uncertainty and armed conflicts like the one in the Middle East may increase the positive perception of Spain as a whole, and the Canary Islands in particular, as safer destinations than other competitors. Conversely, as an island region, its dependence on air transport poses a risk in the event of potential disruptions to the fuel supply. In turn, the faster roll-out of EU funds could boost productive investment.

The Canary Islands’ labour market is among the best-performing in the country, with the number of registered workers affiliated to Social Security increasing by 3.2% on average in 2025 (2.3% on average in Spain) and 2.8% year-on-year in May this year (vs. 2.5%). On a less positive note, the unemployment rate sits above the Spanish average, at 11.4% in Q1 2026 (vs. 10.8%).

Following the shock triggered by the pandemic, tourism has recovered strongly and remains at an all-time high, especially in terms of foreign tourist arrivals and spending, which in 2023 were well above 2019 levels. Meanwhile, total overnight stays recovered the following year. This year has started with somewhat sluggish growth: up to April, the number of foreign tourists rose by just 0.2% year-on-year (3.4% in Spain), reaching almost 5.7 million, whilst spending fell by 0.4% (vs. 6.7%), to just over 8.7 billion euros.

Tourism and strong-performing employment are boosting consumption. Thus, the volume of retail trade sales grew by 4.2% in 2025 (4.0% across Spain as a whole), although growth slowed in the early months of 2026 to 2.5% year-on-year in January–April, below the national average (2.9%). Meanwhile, passenger car registrations are performing marginally less well: after experiencing below-average growth in 2025 (9.3% vs. 12.9%), it is one of the few regions to see a decline in January-May 2026 (–8.1% year-on-year vs. 5.8%).

As far as the industrial sector is concerned, it has continued to perform strongly in recent years thanks to the upturn in tourism and consumer spending, which have boosted the food and manufacturing sectors and hotel and restaurant supplies. After remarkable figures in 2022-2024 (cumulative growth of 12.8% vs. 1.4% in Spain), industrial production returned to normal levels in 2025, growing at a rate similar to the average (1.2% vs. 1.3%). In 2026, it recorded a year-on-year decline of 1.0% up to March (–0.7% for the country as a whole).