Despite positive macroeconomic performance in 2024, the Confederation of Canary Islands Entrepreneurs (CCE) in Las Palmas has cautioned against complacency, warning of an economic slowdown in 2025.
Pedro Ortega, the president of the CCE, stressed the need for preparedness as growth indicators show signs of deceleration.
Speaking at the CCE’s Christmas lunch, Ortega pointed to revised economic forecasts, noting that the regional GDP growth projection has been adjusted downward from 3.4% to 1.9%. Additionally, tax revenues in the second half of 2024 have been weaker compared to the first, while investment has declined, and consumer spending has levelled out.
Although the tourism sector has contributed significantly to the region’s prosperity, high unemployment (currently at 14%) and issues such as inadequate housing and infrastructure persist. Ortega emphasized the importance of a diversified economic model, urging policymakers to ensure that tourism coexists harmoniously with other sectors and societal needs.
“The Canary Islands today are far better than they were in the 1970s,” Ortega said, highlighting the region’s status as a premier global tourist destination, adding that tourism-generated revenue has been instrumental in funding social policies essential for vulnerable populations.
Government Optimism and Debate Over Tourism Tax
Ángel Víctor Torres, Spain’s Minister of Territorial Policy and Democratic Memory, echoed the positive assessment of 2024 during the CCE event. He attributed the region’s strong performance to a resurgence in tourism and robust consumer spending.
However, he acknowledged the rejection of the PSOE party’s proposal for a tourist tax, which was intended to channel revenue into improving wages and public infrastructures.
Looking ahead to 2025, Torres expressed concerns about global uncertainties, including the geopolitical implications of Donald Trump’s presidency in the United States, ongoing conflicts in Ukraine, and unrest in the Middle East. These factors, he warned, could influence the Canary Islands’ economic trajectory.
The Road Ahead
While 2024 concludes on a high note for the Canary Islands, the warning signs of economic cooling underline the need for vigilance and strategic planning.
Business leaders and government officials alike agree that the islands must address longstanding structural issues and continue evolving their economic model to safeguard future prosperity.
