The fall in tourism demand has affected business in general. | Gemma Andreu

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According to a survey carried out by consultants KPMG and the CEOE Spanish Confederation of Business Organisations, 54% of businesses in the Balearics expect to increase their turnover in 2021.

While 94% of businesses surveyed consider the current economic situation in the Balearics to be bad or very bad - 20% higher than the national average - three-quarters of them believe that they will overcome the crisis. This leads to 54% anticipating increased turnover; 32% expect a decrease.

A majority of businesses believe that it will take at least two years for there to be a full recovery, with 72% not expecting their pre-crisis sales levels to recover until the end of 2022. The 54% expectation of increased turnover this year is by and large linked to falls in turnover in 2020.

Thirty-seven per cent of businesses feel that they will have to co-exist with Covid for more than a year, with 27% saying one year and 13% six months. One in five businesses expect that the virus will end up being endemic.

Of economic measures adopted by the Spanish government, the highest valuation, 81%, is for the ERTE furlough scheme. The fall in tourism demand, which has affected businesses in the Balearics more than in other regions, has led to three-quarters of companies having carried out operational restructuring or debt refinancing. Seventy-nine per cent have had to make adjustments to their workforces.