Rural tourism as a response to COVID-19
Rural destinations have emerged as the most attractive choice after the outbreak of the pandemic. Rural areas were a great alternative in the summer for those tourists wanting to travel whilst still maintaining a social distance. As a result, the loss of tourism business in the less urban regions of Spain has been much lower than in more traditional coastal destinations and cities. This article has applied big data techniques to analyse the trends in card payments made by both domestic and international tourists according to the characteristics of the destinations they visited. The results confirm the increased resilience of rural tourism destinations in 2020, suggesting a positive outlook for rural tourism in 2021.
Rural tourism has emerged as one of the alternatives for both domestic and international tourists during 2020. During the summer months, those regions with a relatively large share of rural tourism, such as Asturias, Cantabria and Navarra, recorded a smaller decline in the number of overnight stays by domestic tourists, while the region that suffered the most was the Community of Madrid, Spain's main urban destination along with Barcelona. In fact, overnight stays in rural tourist accommodation barely decreased in the months of July and August, specifically by 12% year-on-year, while total tourist accommodation recorded a drop of 60% year-on-year.
However, the overnight stay data provided by the National Statistics Institute only allows us to analyse tourist movements and we cannot assess the likely changes in tourist consumption habits in 2020. For a broader analysis, we have used data on card payments and cash withdrawals via CaixaBank POS terminals and ATMs. Specifically, we have focused on the payments made with tourists' cards, eliminating all spending by local consumers from the sample.1 We have also classified all the municipalities in Spain as urban, rural or coastal2 in order to analyse the tourist expenditure in the different types of destinations.
- 1. Payments and cash withdrawals via cards issued by foreign companies are used to identi-fy expenditure by international tourists. In the case of domestic tourists, payments and cash withdrawals via cards issued by Spanish companies and made outside the holder's usual place of residence are used. The result has been adjusted using a CaixaBank POS penetration metric to balance the sample across regions with a disparate CaixaBank presence.
- 2. All municipalities, urban and rural, that have a coastline have been classified as coastal destinations. All non-coastal municipalities with fewer than 30,000 inhabitants or 100 inhabitants per km2 have been classified as rural. The remaining non-coastal municipalities have been classified as urban.
methodology to analyse the data from card payments made by tourists in rural destinations.
According to this analysis, rural tourism accounted for about 10% of total tourism expenditure in 2019, of which only 3 pp was due to spending by international tourists. In 2020, on the other hand, the better performance of rural tourism compared with the rest of the sector increased this share to 14%. This is an appreciable portion of total expenditure, in line with the percentage of the population residing in rural municipalities, which is also 14%. As can be seen in the chart, tourism in coastal municipalities, which could be classified as the most traditional destinations for the tourism industry, accounted for 58% of total expenditure in 2020. In addition to being the most important, this was also the type of destination that attracted the highest proportion of foreigners last year, with 55% of expenditure in coastal destinations made via foreign cards. Finally, urban destinations accounted for 28% of total tourist expenditure in 2020.
Tourist expenditure by type of municipality
% of total tourist expenditure
Tourist expenditure by type of municipality (2019)
Tourist expenditure by type of municipality (2020)
In 2020 rural tourism performed better than the rest of the sector, increasing its share to 14%.
If we look at the trends in tourist expenditure in 2020, spending by all tourists (domestic and international) identified via their card payments and cash withdrawals at CaixaBank POS terminals and ATMs fell by 51% in 2020.3 By type of destination, tourist spending fell by 46% annually in cities and by 56% in coastal destinations. In contrast, tourism expenditure in rural destinations fell considerably less (31% year on year) thanks to a much faster recovery in the period when the lockdown restrictions were eased and also because it remained more attractive in terms of social distancing during the months of the summer and early autumn.
As can be seen in the chart, in January this year, the latest month for which we have a detailed breakdown at the time of going to press, the decrease in tourist expenditure was very similar across all destination types: between 51% and 58% year-on-year. This is due to the fact that restrictions on movements have affected the autonomous regions to a similar extent during the second and third waves, in many cases prohibiting travel between regions (and even within the same region), thereby preventing tourists from crossing regional borders.
- 3. The decrease in tourist expenditure reflected by CaixaBank POS terminals is lower than the figure published by the National Statistics Institute. The total tourism expenditure figures published by the National Statistics Institute between January and September 2020 (domestic tourism data for Q4 were not available at the time of going to press) fell by 67.0% year-on-year, while CaixaBank's total fell by 50.5% year-on-year. It should be noted that our metric is affected by the increasing use of cards as a means of payment following the outbreak of the pandemic. There may also be differences due to the fact that CaixaBank POS terminals do not capture spending at origin or payments via cash not withdrawn from ATMs at the destination, while the National Statistics Institute does re-flect this in its Egatur and Familitur surveys.
Tourist expenditure by type of municipality
The greater resilience shown by rural destinations during 2020 was not enough to cushion the huge impact of COVID-19 on Spain's tourism sector, due to their small share within the tourism industry overall and because tourist numbers also declined appreciably for rural destinations. Nevertheless, this has played a very important role in terms of the geographical scope of the impact. Although rural tourism accounted for 14% of the total in 2020, 15 Spanish provinces recorded more than 40% of their tourism expenditure in rural municipalities. In these provinces that are more dependent on rural tourism, total expenditure fell by 33% annually, 17 pp less than the average for Spain. In comparison, the predominantly urban and coastal regions have been harder hit by the COVID-19 pandemic. In the 9 provinces with less than 5% of rural tourism, tourist expenditure fell by 60% (9 pp more than the average for Spain).
In these provinces that are more dependent on rural tourism, total expenditure fell by 33% annually, 17 pp less than the average for Spain.
Share of rural tourism in Spain
Tourism expenditure in non-urban municipalities as a percentage of total tourism expenditure
If we look at the trends in tourist expenditure by type of destination and business, we can see that all types of businesses located in rural municipalities recorded smaller decreases in turnover from international and domestic tourists. Firstly, the tourist accommodation establishments (hotels and non-hotels) located in rural municipalities were much less affected by the crisis in 2020. As shown in the table, rural tourism expenditure fell by 44% annually while the decrease was 76% and 79% for urban and coastal destinations, respectively. A similar situation can be seen in spending on food and drink, one of the sectors that has been hardest hit by the consequences of COVID-19 in major tourist destinations, with tourist expenditure falling by more than 55% annually in urban and coastal destinations but falling by 27% in rural destinations. However, it is worth noting that the decrease in tourist expenditure in rural destinations was also considerable, albeit not as severe as in the rest of the destinations.
we can see that all types of businesses located in rural municipalities have recorded smaller decreases
Trends of tourist expenditure in 2020, by type of destination and business
- CaixaBank's internal data show that the impact of COVID-19 on rural and inland tourism has been notable but more moderate than in other tourism destinations. Tourists have largely opted for less crowded and relatively tranquil destinations, with rural tourism reigning supreme.
- In 2021, rural tourism will also be one of the driving forces of the recovery as its growth will not be so restricted by the social distancing requirements in place during the first few months of returning to normal, while the population's immunisation will still be incomplete.
- In the medium term, the two major destinations for post-COVID tourism will still be coastal and urban locations. However, COVID-19 may notably speed up changes in the economy, with rural tourism gaining in importance.
- The initiatives supported by the European Recovery Plan (NGEU) to digitalise and modernise Spain's tourism supply could particularly boost destinations that are currently less wellestablished, including rural ones, helping Spain's tourism supply to diversify and thereby maintain its competitive edge over the rest of the international markets.