Runaway fuel prices could hit tourism

On the day that 95 per cent of Majorca's resort hotels closed for the winter, the Bank of Spain published a report which concluded that the prolonged hike in fuel prices could hit some of Spain's main tourism feeder markets in Europe which, in turn, will hit holiday sales to Spain as Europeans opt for cheaper destinations.

The report also claims that, despite a relatively positive third quarter, tourism has had a poor year and that Spain's principal Mediterranean competitors, especially those not in the Euro have been the big winners, at Spain's expense. Tourism figures have risen, but spending has fallen and the down turn in revenue from tourism has had a negative effect on Spain's economy. Only in Palma, Cala Mayor, Playa de Palma and in certain parts of Calvia are some hotels staying open over the winter while some resorts are closing up completely with many souvenir shops and even the restaurants deciding to cut their losses if local hotels are going to be closed until the Spring.

The President of the Majorcan Hotel Federation, Pere Cañellas, says that if there is not the demand during the winter, then it is only normal that hotels are going to close, although he has admitted that this year some are closing earlier than usual.