Mexico: revenue losses in the tourism sector due to COVID-19 by scenario 2020

If the COVID-19 outbreak in Mexico reduces domestic tourism by half and the arrival of international travelers by 80 percent, the Mexican tourism sector could lose up to 172.9 billion Mexican pesos in 2020. At the exchange rate of April 7, 2020, this amounts to 7.2 billion U.S. dollars. In a more pessimistic scenario of a 75 percent drop in domestic travel and an 80 percent decrease of foreign visits to Mexico, the Latin American country could register losses in tourism revenue of 239.2 billion Mexican pesos (nearly 10 billion U.S. dollars).

Tourism contribution to GDP in Mexico

From 2010 to 2018, the tourism sector was responsible for approximately 8.5 percent of Mexico’s gross domestic product (GDP), which amounted to more than 2.6 trillion international dollars in 2019, based on current prices. After the outbreak of the novel coronavirus, the country’s economic growth forecasts were adjusted. By the end of 2020, Mexico’s real GDP is expected to face a contraction of more than six percent. This downward trend could still worsen if worldwide restrictions imposed on tourism are prolonged through the second half of the year.

International tourism in Mexico

Mexico is by far the leading tourism destination in Latin America. Its combination of beautiful beaches, authentic cuisine and indigenous history attracts millions of tourists every year. In 2018, this country welcomed nearly six times more international visitors than Argentina, which was the second most popular Latin American tourism destination among foreign travelers that year. In terms of tourism expenditures, Mexico is also the country where international travelers spend the most in the whole Latin American and Caribbean region.