The Impact of the Economic Crisis and the Pandemic on the Portuguese Tourism Industry: An Econometric Approach

Tourism is one of the sectors with the highest weight in Portugals Gross Domestic Product (GDP) and is expected to account for 56.4 billion euros (21.1%) of Portugals GDP in 2033. In the case of the pandemic crisis (COVID-19), the impact on the sector was greater due to the restrictions imposed on international travel and the booking of holidays, resulting in unemployment in the sector and the closure of establishments. Faced with such restrictions, international tourists, especially domestic tourists, have discovered new, more remote, and less explored destinations. Using data provided by National Statistics Institute Portugal (2004 – 2024), we use robust econometric methods (particularly due to the presence of seasonality and autocorrelation), models autoregressive integrated moving average, to assess the impact of the pandemic and economic crises (2008 and Brexit) on the Portuguese tourism industry, namely by region (NUTS II – Nomenclature of Territorial Units for statistical purposes), to make a valid contribution to planning in future crises. The results allowed the impact of external effects on the behaviour of the number of overnight stays series to be identified. In addition to studying this behaviour, forecasts were made and the errors calculated based on indicators such as Mean percentage absolute error (MAPE) and U-Theils statistical for periods after the historical series.